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SINGAPORE: Amid the rising unemployment rate, middle-aged workers have been hit harder than other groups. In addition to being at higher risk of being laid off, they may also have a harder time landing new jobs, economists said.
According to the Ministry of Labor’s (MOM) Third Quarter Labor Market Report released on Thursday (December 17), the unemployment rate among residents (Singaporean and permanent residents) aged 40-59 was higher and increased more abruptly compared to those in their 60s and 60s. above, as well as those aged 30 to 39.
READ: Non-residents account for 9 out of 10 of total employment decline from January to September: MOM labor market report
The unemployment rate for residents ages 40-49 increased 1.3 percentage points from 3.0% in June to 4.3% in September. Among those aged 50 to 59, the rate increased by 0.9 percentage points to 4.6%.
In comparison, the number of people between 30 and 39 years old increased 0.7 percentage points in the three months to 3.5% in September. The rate fell 0.3 percentage points to 4.1% for those aged 60 and over.
Only residents under 30 had a higher unemployment rate, from 7.2% in June to 7.9% in September.
Mid-career residents also suffered the highest number of layoffs among the five age groups in the third quarter: 4.1 residents laid off (40-49 years) and 5.0 (50-59 years) per 1,000 employed residents .
This contrasts with a rate of 2.7 (under 30 years old), 3.7 (30 to 39 years old) and 3.7 (60 and over).
The unemployment rate in September 2020 by age, from the Labor Market Report of the Ministry of Labor Third Quarter of 2020.
Economists said that middle-aged workers are often more at risk of being laid off during a recession, as they have higher wages than those older and younger than themselves, making them more likely targets for job reduction measures. costs.
The unemployment rate is also higher because it usually takes longer to find a suitable job. They would need one that meets their level of experience and salary expectations, especially since they bear the burden of household obligations such as mortgages, their parents’ healthcare costs and children’s education expenses, the observers added.
READ: IN FOCUS: After COVID-19, where is Singapore’s workforce and economy headed?
“And it’s not easy in such a challenging economic climate to find a job that pays as much as your previous job,” said DBS economist Irvin Seah, who called this group a “vulnerable segment” of workers whom policy makers they should change their focus. to.
“It’s not just about finding a job again. It’s about whether the job is about to cover your monthly expenses … especially if you have a family to feed. “
They may also be more likely to fill jobs at risk of technological or business disruptions, or have more financial resources to spend more time searching for jobs, said labor economist Walter Theseira, associate professor at Singapore University of Social Sciences. .
Seah said the unemployment rate among middle-aged workers will likely show an increase in the fourth-quarter figures and will remain high until the middle of next year after the company’s profits improve, which then encourages hiring managers. to expand your staff.
Observers said these numbers need to be closely watched. If the employment situation does not change, it could result in long-term unemployment and difficulties for households.
“It will definitely be a worrying trend,” Seah said. “Workers who have been unemployed for too long will eventually lose heart.”
It becomes more difficult for these workers to be hired the longer they have been out of work, he said. “(Their) mindset will deteriorate (and) employers will also view them in a less positive light.”
Dr. Theseira said the concern is not whether these middle-aged workers can find a job, but whether they can get one with decent prospects.
“The problem will be that if middle-aged workers cannot find good career options, their families are likely to suffer significant drops in their standard of living or face significant damage to their financial security for retirement,” he said.
“If they cannot return to a career with good income and prospects for progression, we could hope that social support for their dependents should improve,” he added.
The COVID-19 pandemic and its impact on the faster pace of digitization could lead to fewer job opportunities in the new normal, as software and robots take over jobs previously done by humans, Song Seng Wun said, CIMB private banking economist. Companies would also want a tech-savvy workforce that can handle these tools.
Then there’s the bias against older workers, who are “dinosaurs” not open to change, which could make some business owners prefer younger job seekers to older ones, he added, making it difficult for them to middle-aged workers recover. hired.
READ: As COVID-19 accelerates automation, what does the future hold for job seekers without technology?
There are schemes designed to help this segment of workers, analysts said. These include mid-career conversion programs, subsidized training initiatives, career counseling services, and anti-age discrimination regulations.
Other recently implemented measures to encourage companies to hire local and older workers include wage subsidies and curbing the influx of foreign workers.
“It’s always about whether (companies) can continue to be incentivized and (from) the other side, to what extent (the worker) they are looking for is willing to change,” Song said.
The question is how to sharpen these measures, the economists added.
Noting the Incentive for Job Growth, a wage subsidy scheme in which the government co-pays the salary of a local employee: 25 percent for those under 40; 50 percent for those 40 and older: Mr. Seah said the government should fund up to 75 percent for low-wage workers 40 and older for employers to turn to instead of resorting to foreign labor.
READ: Singapore’s labor market could bottom out by late 2020, but uneven recovery may widen income gap: analysts
As Singapore reopens its economy further, observers said the government should now focus on identifying the segments of the population that are struggling to find a new job.
MOM said on Thursday it will pay attention to the long-term unemployment rate, residents unemployed for at least 25 weeks, which rose 0.1 percentage point to 0.9 percent in September.
“We cannot wait for the problem to manifest itself before working on it. Now is the time to start, ”Seah said.
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