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6 November 2023
In recent years, the labor market in Thailand has experienced a major “demographic disruption” that has affected the employment dynamics among the senior population (we will focus on individuals aged 55 and above in this article as this reflects the typical “early retirement age” in the country). Data from the National Statistical Office (NSO) spanning from 2011 to 2021 reveals a significant increase in the senior population, a rise from 12 million to 18 million people.1 This shift is not only significant in numerical terms but also has far-reaching implications for various aspects of the country’s social and economic structure.
1. However, it is important to note that the data from the National Statistical Office (NSO) that we used does not cover informal workers and sectors and this omission highlights the complexity of the situation, as many seniors might engage in informal work that is not reflected in these statistics. Moreover, it’s worth noting that the NSO data is collected during the fourth quarter of each year, mirroring the data collection practice of the Department of Employment. As such, the analysis may not comprehensively capture seasonal fluctuations or shifts that transpire over the course of the year, which could conceivably impact the employment statistics concerning senior citizens.
Despite these limitations, the employment rate within the senior age group has not shown a corresponding upward trend. According to the data from the National Statistical Office, from 2011 to 2021, the number of senior employment (individuals aged 55 and above that have a job) had increased by only 600,000 while the number of senior populations in this age range had increased by 6 million people. In other words, only 10 percent of the senior population had participated in the labor market. This disparity between the growth of the senior population and the employment of senior individuals indicates a substantial “untapped” potential within this demographic group that demands attention from policymakers, businesses, and society as a whole.
Furthermore, our analysis also reveals that the impact of demographic disruption on the labor market was unevenly distributed across various occupations. Some occupations such as sales workers and agricultural workers experienced a significant drop in the employment of senior individuals (decrease by 20 percent and 30 percent respectively). Potentially these are occupations in which senior individuals have lost their attractiveness (or being perceived to have lost their attractiveness) as productive workers when competing against younger individuals.
Still, some occupations saw a significant increase in senior workers. For example, senior refuse workers (i.e., people who collect garbage for work) increased by 230 percent while senior cleaners and helpers increased by 120 percent. Why did we see an increase in senior employment in these occupations? A potential hypothesis is that these are occupations that younger individuals are not interested and thus lead to reduced competition for senior individuals.
Another interesting insight is that our research highlights a significant difference in employment growth between senior individuals working in routine jobs and those in non-routine jobs. Senior individuals engaged in routine jobs, such as machine operators and laborers, experienced slower employment growth than those in non-routine jobs, like healthcare professionals and legal experts. Potentially, routine jobs often require physical abilities that deteriorate with age. Additionally, these jobs are more susceptible to replacement by automation technologies. This illustrates another potential channel through which technological disruption can impact senior employment.
Over the past three years (2018-2021), there were approximately 1 million individuals who became senior citizens per year. If we use the above information that we can absorb only 10 percent of senior citizens into the labor market, this implies that we are losing an “untapped” potential of at least 900,000 individuals per year. Five years from now, we will lose around 4.5 million individuals cumulatively. Ten years from now, we could lose up to 9 million individuals cumulatively. And the longer these senior individuals have left the labor market, the harder it is to bring them back into the labor market.
So, what should we do? We think it is critical to rethink how we value the so-called “silver workforce”. Commonly, many people and organizations do not recognize the great potential from this group of people. This suggests the enormous opportunity to leverage the potential of this expanding group. Policymakers and businesses should respond proactively by implementing strategies such as offering incentives for hiring older workers, investing in customized skill development programs, and recognizing the substantial economic contributions these individuals can bring. These actions can be crucial for unlocking the benefits of this demographic shift and boosting the performance of Thai economy.
With the substantial increase in the senior population and the relatively modest growth in the number of seniors employed, it becomes evident that a reservoir of untapped potential exists. This potential, if strategically harnessed, holds the promise of bolstering the nation’s economic growth, amplifying productivity, and ensuring the continued engagement of older individuals in meaningful and fulfilling roles. Moreover, by nurturing the well-being of senior workers and providing opportunities for skill enhancement, they can excel in specific vocations such as teaching, legal practice, and managerial roles that people become more productive by age. Furthermore, with the assistance of technology, senior workers can be augmented through innovative tools like virtual reality (VR) and augmented reality (AR) or even physical augmentation, enabling them to perform tasks with enhanced efficiency and adaptability.
To unlock this untapped potential, a multi-faceted approach is essential. This approach should encompass tailored skill development programs that align with emerging technologies and allow for flexible work arrangements that cater to the unique needs and preferences of senior workers. Furthermore, fostering an age-inclusive work environment and championing age-diverse teams can further optimize the utilization of this underutilized labor force. In addition to their contributions to the workforce, senior workers can play a pivotal role in addressing various social issues, including environmental concerns or volunteering to help in various areas. Their wealth of experience and expertise can be valuable in tackling complex challenges and finding sustainable solutions for the betterment of society as a whole.
In summary, by embracing this untapped potential, Thailand can better position itself to navigate the evolving dynamics of its labor market, creating a win-win scenario that benefits individuals, businesses, and society at large.
This article is written by
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Chula’s encouragement and support for research is excellent for teachers, students, and the public. Associate Professor Dr. Suchana Chavanich Faculty of Science, Chulalongkorn University
Chula’s encouragement and support for research is excellent for teachers, students, and the public.
Associate Professor Dr. Suchana Chavanich Faculty of Science, Chulalongkorn University
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