What SG’s ageing population means for the young

The total elderly population is expected to outnumber the young by 2025.

The old age dependency ratio per 100 residents in Singapore has risen to 23.4 in 2020 from only 13.5 in 2010, the Department of Statistics reported.

This comes as the proportion of aged 65 and above expanded to 15.2% of the total population from 9% in the previous decade.

Singapore’s population grew 1.1% between 2010 and 2020 to 5.69 million, its slowest since independence. Meanwhile, the fertility rate amongst females aged 40 dropped, registering an average of 1.76 births in 2020.

“Assuming 3-year average growth rate in the young (age 0 – 19) and elderly population (age above 65), Singapore’s total elderly population could potentially be on par with the young as early as 2024, and outnumber the young in 2025,” UOB’s Global Economics & Markets Research reported.

UOB added this suggests that the elder population will need to depend on the “shrinking pool of productive workers,” in terms of tax collections that shoulder their healthcare and other retirement benefits.

The bank noted that this increasing burden could be amongst the factors behind the falling fertility rate.

“Assuming the trend continues, there’s a need to increase government revenue to support spending required for Singapore’s ageing population,” UOB said.

On top of this, the increase in the ageing population could also shift demand patterns, particularly increasing demand for healthcare goods and services.

This could also lead to a rise in Singapore’s non-resident population in order to supplement the economically active group.