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1、Promoting Active Ageing in Southeast AsiaPromoting Active Ageing in Southeast AsiaThis work is published under the responsibility of the Secretary-General of the OECD and the President of ERIA.Theopinions expressed and arguments employed herein do not necessarily reflect the official views of the Me

2、mbercountries of the OECD or the views from the members countries of ERIA.This document,as well as any data and map included herein are without prejudice to the status of or sovereignty overany territory,to the delimitation of international frontiers and boundaries and to the name of any territory,c

3、ity or area.The names and representation of countries and territories used in this joint publication follow the practice of the OECD.Please cite this publication as:OECD/ERIA(2025),Promoting Active Ageing in Southeast Asia,OECD Publishing,Paris,https:/doi.org/10.1787/22849f38-en.ISBN 978-92-64-67181

4、-2(print)ISBN 978-92-64-58128-9(PDF)ISBN 978-92-64-57619-3(HTML)Photo credits:Cover hxyume/Getty Images.Corrigenda to OECD publications may be found at:https:/www.oecd.org/en/publications/support/corrigenda.html.OECD/ERIA 2025.Attribution 4.0 International(CC BY 4.0)This work is made available under

5、 the Creative Commons Attribution 4.0 International licence.By using this work,you accept to be bound by the terms of this licence (https:/creativecommons.org/licenses/by/4.0/).Attribution you must cite the work.Translations you must cite the original work,identify changes to the original and add th

6、e following text:In the event of any discrepancy between the original work and the translation,only the text of original work should be considered valid.Adaptations you must cite the original work and add the following text:This is an adaptation of an original work by the OECD and ERIA.The opinions

7、expressed and arguments employed in this adaptation should not be reported as representing the official views of the OECD or of its Member countries or ERIA and its member countries.Third-party material the licence does not apply to third-party material in the work.If using such material,you are res

8、ponsible for obtaining permission from the third party and for any claims of infringement.You must not use the OECDs or ERIAs respective logo,visual identity or cover image without express permission or suggest the OECD or ERIA endorses your use of the work.Any dispute arising under this licence sha

9、ll be settled by arbitration in accordance with the Permanent Court of Arbitration(PCA)Arbitration Rules 2012.The seat of arbitration shall be Paris(France).The number of arbitrators shall be one.3 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Foreword The OECD/ERIA project Promoting Acti

10、ve Ageing in Southeast Asia results in two reports.This OECD Report analyses the active ageing policies that can help older people in ASEAN Member countries age healthily and independently and avoid feeling insecure,particularly in terms of income.Chapter 1 discusses the key background demographic,e

11、conomic and employment characteristics that are relevant for the promotion of active ageing in ASEAN Member States.Chapter 2 analyses the main areas potentially limiting work capacity at older ages,while Chapter 3 emphasises the need to strengthen health and social policies in order to drastically i

12、mprove the prospects of active and healthy ageing in ASEAN countries.Finally,Chapter 4 builds on the analyses in the previous chapters to identify the policy implications to promote active ageing among ASEAN countries.The second report produced by the Economic Research Institute for ASEAN and East A

13、sia(ERIA)is scheduled to be published later in 2025.It will consist of country case studies based on longitudinal data documenting the disease structure and disability of older people based on various aspects,such as gender,formal-informal economy,and urban-rural,in each country.Herv Boulhol led the

14、 OECD team and coordinated the OECD part of the project and the publication of the OECD Report.Chapter 1 was written by Herv Boulhol,Maciej Lis and Andrew Reilly.Chapter 2 was written by Benthe Geerdink and Maciej Lis,while Wouter De Tavernier,Risako Ninomiya and Andrew Reilly wrote Chapter 3.Chapte

15、r 4 was a collective effort of the above authors.We are very grateful to Monika Queisser,Head of the Social Policy Division,for having provided in-depth comments on all chapters.We would like to deeply thank ERIA colleagues in particular Uswa Alhamid,Narihiro Hirai,Takuma Kato,Mustika Marwah,Yasuyuk

16、i Mitsuhashi,Mirrah Nabighah,Asuka Nagatani,Liem Nguyen,Rashesh Shrestha,Nanda Sucitra Putri,Antonio Fredelindo Dela Resma Villanueva and Chang Wan Seok-as well as Yasuhiko Saito from Nihon University and Yuki Ryogo and Tomo Sato,both from the Japanese Delegation at the OECD for their constant suppo

17、rt throughout the project in coordinating the answers to the questionnaire sent at the early stage,for organising the OECD June 2024 mission to Jakarta and for providing very helpful comments on draft chapters.The project greatly benefited from the interactions with participants in the April 2024 Pa

18、ris Workshop“Promoting Active Ageing in Southeast Asia”in Paris organised by ERIA/OECD/IUSSP and with participants in the June 2024 Jakarta Regional Consultative Meeting on“Promoting Active Ageing in Southeast Asia”organised by ERIA.We are very thankful to colleagues we met during the Jakarta missio

19、n who provided great insights into the project,including from ASEAN Member States,ILO,the Indonesian Ministry of Finance,SMERU and the World Bank.The Report benefited from very helpful comments by ELSAC Delegates during the October 2024 meeting and by numerous OECD colleagues,including:Bert Brys,Sab

20、ine Laudage Teles and Michael Sicsic(Centre for Tax Policy and Administration),Jonathan Chaloff and Luca Lorenzoni(Directorate for Employment,Labour and Social Affairs),Carolin Beck,Pierre De Boissson,Alexandre Kolev,Hyeshin Park and Pablo Suarez Robles(Development Centre),Pablo Antolin(Directorate

21、for Financial and Enterprise Affairs),Jens Arnold and Charles Dennery(Economics Department),while Andrea Goldstein and Julien Jarrige(Economics Department)and Massimo Geloso Grosso(Global Relations and 4 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Cooperation Directorate)helped with org

22、anising the mission to Jakarta.Thanks also go to Sandra Celso,Marie-Aurlie Elkurd,Lucy Hulett and Hanna Varkki for their administrative support and help in preparing the manuscript for publication.We also thank Stefano Scarpetta and Mark Pearson,Director and Deputy Director of Employment,Labour and

23、Social Affairs at the OECD for their key comments at various stages of the project.The project benefited from financial support by ERIA.5 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Table of contents Foreword 3 Executive summary 8 1 Demographic,economic and employment trends 11 1.1.Key

24、findings 12 1.2.Demographic changes among ASEAN countries 13 1.3.Overall economy 24 1.4.Formal and informal employment 30 1.5.Does ageing lower income and productivity growth?36 References 41 Notes 44 2 Main areas potentially limiting work capacity at older ages 46 2.1.Key findings 47 2.2.Employment

25、 at older ages and working conditions 48 2.3.Wage setting and mandatory retirement ages 52 2.4.Health-related ability to work at older ages 57 References 69 Notes 71 3 Strengthening health and social policies to ensure active and healthy ageing 72 3.1.Key findings 73 3.2.Improving access to good-qua

26、lity healthcare and preventing bad health 75 3.3.Improving pension systems 86 3.4.Facilitating ageing in place and the mobility of older people 98 3.5.Reducing gender inequalities and formalising care 103 References 107 Notes 115 4 Policy implications 118 4.1.Introduction 119 4.2.Tackling labour mar

27、ket informality 120 4.3.Reducing gender inequalities in old age and improving care provision 124 4.4.Providing an inclusive access to healthcare 131 4.5.Enhancing social protection in old age 136 4.6.Promoting the social participation of older people 146 4.7.Recommendations 150 6 PROMOTING ACTIVE AG

28、EING IN SOUTHEAST ASIA OECD/ERIA 2025 References 153 Notes 162 FIGURES Figure 1.1.Sharp projected fall in the size of the working-age population in Singapore and Thailand 14 Figure 1.2.The rate of growth of the working-age population is falling 14 Figure 1.3.Total Fertility Rate projections from dif

29、ferent UN datasets 16 Figure 1.4.Life-expectancy gains are not projected to slow in most ASEAN countries 17 Figure 1.5.The pace of ageing is much faster in ASEAN than in OECD countries 18 Figure 1.6.The old-age to working-age ratio is accelerating 20 Figure 1.7.Large increases in the number of older

30、-age people in the coming decades 21 Figure 1.8.Migration has a large impact on the pace of ageing in Malaysia,Singapore and Thailand 22 Figure 1.9.Smaller household sizes over time 23 Figure 1.10.The proportion of women at older ages has been fairly stable 24 Figure 1.11.GDP-per-capita among ASEAN

31、countries,2023,US$PPP 24 Figure 1.12.GDP-per-capita in ASEAN and OECD countries,2023,US$PPP(Log)25 Figure 1.13.Higher economic growth for low-income countries among ASEAN Member States 26 Figure 1.14.Public expenditure,percentage GDP,2023 27 Figure 1.15.Age-related public expenditures to increase sh

32、arply in some ASEAN countries 28 Figure 1.16.General government debt as a percentage of GDP 29 Figure 1.17.Current account balance,percentage GDP,annual average 2014-23 29 Figure 1.18.Employment rate has been stable in ASEAN countries over the last decade 30 Figure 1.19.Many workers in ASEAN countri

33、es still work in agriculture 31 Figure 1.20.Informal employment is widespread but declining in some ASEAN countries 33 Figure 1.21 Demographics to weigh on the growth of GDP-per-capita as the increase in the number of older people is no longer more than offset by fewer children 36 Figure 1.22.There

34、is no relationship between speed of ageing and productivity growth 40 Figure 1.23.ASEAN countries are less prepared for technology and innovation than OECD countries 41 Figure 2.1.Many older people work in ASEAN countries 48 Figure 2.2.ASEAN countries are expected to record large improvements in edu

35、cational attainment 49 Figure 2.3.Many workers in ASEAN countries work very long hours 50 Figure 2.4 Many workers are exposed to physical risks in ASEAN countries 51 Figure 2.5.Male workers in their 40s have the highest wages 53 Figure 2.6.Gender pay gap is relatively low in most ASEAN countries 54

36、Figure 2.7.Views on the division of labour are strongly gendered in some ASEAN countries 55 Figure 2.8.In most ASEAN countries old-age life expectancy is much lower than in the OECD 57 Figure 2.9.Healthy life expectancy is about three-quarters of remaining life expectancy at age 60 58 Figure 2.10.Di

37、sability increases strongly with age 59 Figure 2.11.Labour market participation decreases with age 60 Figure 2.12.Labour market participation rate and remaining life expectancy 62 Figure 2.13.Most ASEAN countries have substantial unused work potential at the aggregate level 64 Figure 2.14.Large unus

38、ed health-related work potential for older women in ASEAN countries 65 Figure 2.15.Women and older people contribute most to the unused health-related work potential 66 Figure 2.16.Health and labour market participation become less related with age 68 Figure 3.1.Low levels of healthcare expenditure

39、76 Figure 3.2.Low government expenditure on health 77 Figure 3.3.Access to“essential”health services has drastically improved across ASEAN countries 79 Figure 3.4.ASEAN countries have limited healthcare capacities 81 Figure 3.5.Households with older people are more likely to have high health expendi

40、tures 82 Figure 3.6.Spending on preventive care is similar in ASEAN and OECD countries on average 83 Figure 3.7.Lower tobacco use but higher alcohol consumption,obesity and hypertension 85 Figure 3.8.Pre-tax income inequality(GINI)is high,but falling,in ASEAN countries 86 Figure 3.9.Current and futu

41、re normal retirement ages for male private sector workers 93 Figure 3.10.Net pension replacement rates by earnings,in percentage 94 Figure 3.11.Difference in net replacement rates for average earners by gender 95 Figure 3.12.Implicit vs.internal rates of return across earnings levels 97 Figure 3.13.

42、Home-ownership rates are high in most ASEAN countries 99 7 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Figure 3.14.Older people often live in the same household as their grandchildren 100 Figure 3.15.Gender discrimination in family and inheritance laws is highly prevalent in most ASEAN

43、countries 103 Figure 3.16.The large majority of unpaid care and domestic work is done by women 106 Figure 4.1.Old-age safety-net benefits compared to GDP per capita,2022 138 Figure 4.2.Projected remaining life expectancy at normal retirement age 144 TABLES Table 1.1.Total fertility rate,1964-2064 15

44、 Table 1.2.Demographic old-age to working-age ratio:Historical and projected values,1964-2084 19 Table 1.3.Young-age and old-age to working-age ratios in ASEAN countries 37 Table 3.1.Structure of retirement-income provision through mandatory schemes 88 Table 3.2.Pension plan assets,at the end of 202

45、3 or latest year available 88 Table 3.3.Coverage of old-age pensions 89 Table 3.4.Current level and recipients of first-tier benefits 90 Table 3.5.Mandatory contribution rates in 2022 92 Table 4.1.Ratio of effective accrual to contribution rates 145 8 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/E

46、RIA 2025 Executive summary Ageing will be very fast in Southeast Asia with the added challenge that most ASEAN countries have a very large share of informal employment.Promoting active ageing aims to ensure that older people can age healthily and independently and avoid feeling insecure,particularly

47、 in terms of income.Key active ageing policies in the ten ASEAN countries should focus on:tackling labour market informality;reducing gender inequalities in old age and improving care provision;providing inclusive access to health care;enhancing social protection in old age;and,promoting the social

48、participation of older people.This Executive Summary summarises key measures to address these challenges.Key recommendations to reduce labour market informality to promote active ageing Lower the cost of formalisation for low-income workers by limiting general labour taxes on their earnings.This can

49、 be done,for example,by applying mandatory pension contributions only beyond an earnings threshold and by financing flat-rate basic benefits through other taxes.Enhance compliance with labour and social security regulations through an effective judiciary,well-equipped labour and tax inspectorates,la

50、rge enough penalties for non-compliance,strong involvement of social partners and strict requirements for contractors of public procurement to employ workers formally.Ease administrative processes of business registration and reporting,remove legal obstacles to firms growth,fight corruption and enco

51、urage a responsible business conduct to promote a business-friendly environment.Ensure that product market regulations are not too strict,employment protection legislation is flexible enough and the minimum wage is adequate but at a level that does not create substantial barriers to formalisation.Ke

52、y recommendations to reduce gender inequalities in old age Follow up with concrete action on the commitment in principle to gender equality in old age by ASEAN countries.Systematically include a gender perspective in designing policies for all stages of life to mitigate compounding inequalities.This

53、 can be achieved by:appointing key leaders within government structures responsible for integrating gender considerations into planning,budgeting and implementing policies;strengthening independent institutions and advisory bodies that monitor and report on gender equality;and,improving data collect

54、ion to monitor and report on gender equality efforts.Raise awareness about gender inequalities in education and training and how to address them.Public information campaigns highlighting the benefits of gender equality and of programmes that help women plan financially for retirement would improve w

55、omens income security in old age.The 9 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 public sector can lead the way by implementing training on gender inequalities in career development and talent management.Reform legal frameworks to reduce gender discrimination in public and private lif

56、e and in the workplace.Brunei Darussalam,Indonesia,Malaysia and Myanmar have laws,often personal status laws,that currently still cement gender inequalities in the family as these laws grant men and women different entitlements to marriage,divorce and inheritance.Brunei Darussalam,Lao PDR,Malaysia a

57、nd Thailand need to step up efforts to tackle gender discrimination and harassment in the workplace.Key recommendations to provide inclusive access to healthcare Allocate more public financial resources to the healthcare sector,particularly in Brunei Darussalam,Lao PDR,Malaysia and Singapore.Improve

58、 efficiency in the way healthcare resources are spent by:cutting ineffective spending,for instance through increasing penetration of generic drugs,regulating both pricing and prescribing medicines;strengthening preventive health policies;and,investing in new technologies.Establish in law that the fu

59、ll population is covered by health insurance for basic healthcare and use contributory health insurance to provide access to a wider set of healthcare services.In order to improve access to healthcare in rural areas,Cambodia,Lao PDR and Myanmar should increase the total number of healthcare personne

60、l through increasing efforts to recruit students into medical programmes.This could be done through scholarships conditional on working in underserved areas after graduating to recruit students willing to work in rural areas.In countries where there is no overall shortage of healthcare personnel,pro

61、viding financial incentives to work in underserved areas or granting limited licenses for establishing a practice in overserved areas could improve their geographic distribution.Access in rural areas can also be improved by changing healthcare service delivery,for instance through telemedicine or th

62、rough delegating some tasks typically performed by doctors to other providers.Promote the incorporation of physical exercise and active lifestyles in older peoples daily routines.Key recommendations to enhance social protection in old age Increase first-tier benefit levels in all ASEAN countries,sig

63、nificantly so in many,to ensure adequate support for current pensioners.This particularly applies to Brunei Darussalam,Singapore and Thailand.Clearly highlight the benefits of contributing to pensions and develop communication campaigns.The latter should be part of an overall national strategy for f

64、inancial education related to pensions.Raise the retirement age in Malaysia and Thailand.Once this discretionary adjustment is legislated,introduce an automatic link between the retirement age and life expectancy in both countries,as well as in other ASEAN countries.Significantly reform pay-as-you-g

65、o pension schemes so that contributions are sufficient to finance current promises by either increasing contributions or reducing accrual rates or a combination of both.More precisely,at the minimum,accrual rates should be lowered in Lao PDR and the Philippines and PAYG contribution rates increased

66、in Indonesia,Lao PDR and Thailand.Regularly index all earnings-related pensions paid during retirement based on a clear rule.10 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Key recommendations to promote the social participation of older people Redesign neighbourhoods to make it easier a

67、nd safer for older people to go outside.This includes removing obstacles such as high pavements,improving traffic safety,particularly close to crossings,and installing benches for older people to rest.Create social opportunities for older people to meet on a regular basis.11 PROMOTING ACTIVE AGEING

68、IN SOUTHEAST ASIA OECD/ERIA 2025 This first chapter sets the scene by examining the key background demographic,economic and employment characteristics in ASEAN Member States that are relevant for the promotion of active ageing.It first documents the specific features behind fast ageing prospects amo

69、ng ASEAN countries.The chapter then turns to the overall economy by highlighting the fast pace of economic growth in low-income ASEAN countries with a focus on broad macroeconomic issues related to public finance and current account balances.The third section discusses formal and informal employment

70、,emphasising the challenges of a high degree of informality in most ASEAN countries.The last section discusses the interactions between population ageing and productivity growth.1 Demographic,economic and employment trends 12 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 1.1.Key findings

71、This first chapter sets the scene by examining the key background demographic,economic and employment characteristics in ASEAN Member States that are relevant for the promotion of active ageing.It first documents the specific features behind fast ageing prospects among ASEAN countries.The chapter th

72、en turns to the overall economy by highlighting the fast pace of economic growth in low-income ASEAN countries with a focus on broad macroeconomic issues related to public finance and current account balances.The third section discusses formal and informal employment,emphasising the challenges of a

73、high degree of informality in most ASEAN countries.The last section discusses the interactions between population ageing and productivity growth.The key findings are the following.Demographic changes All ASEAN countries have seen considerable growth in their working-age population over the last 40 y

74、ears.While the size of the working-age population is projected to continue increasing in Cambodia,Lao PDR and the Philippines by 25%or more over the next 40 years,it is projected to fall by about 30%in both Singapore and Thailand.Fertility rates have fallen sharply from high levels in ASEAN countrie

75、s.The total fertility rate averaged 6.0 across ASEAN countries in the early 1960s,3.3 in the early 1990s and now averages 1.8,below the population replacement rate of about 2.1.Life-expectancy gains are not projected to slow on average.Between 1984 and 2024 remaining life expectancy at age 65 increa

76、sed by 3.1 years on average across the ASEAN countries to 16.3 years.It is projected to further increase by another 3.1 years over the next 40 years.Given falling fertility rates and continued gains in life expectancy gains,ageing is set to accelerate.Over the next 30 years the ASEAN old-age to work

77、ing-age ratio is projected to increase by 19 percentage points(p.p.)compared to an increase of less than 6 percentage points for the previous 30 years.ASEAN populations will be ageing twice as fast as in the OECD on average.It will take only 36 years for ASEAN countries on average to go from 15 to 4

78、0 people aged 65+per 100 people aged 20-64 compared to 74 years for the OECD.Household sizes have been shrinking over recent decades,which will increase womens vulnerability risks in old age.Household sizes have fallen by around 0.8 people on average across ASEAN countries over the last 20 years,wit

79、h Lao PDR recording the largest fall from 6.0 people on average in 2000 to 4.7 in 2017.Demographics have been favourable for the growth of GDP-per-capita in ASEAN countries until now,but this positive mechanical effect is expected to disappear in the near future,except in Cambodia,Lao PDR and the Ph

80、ilippines.The drag will be large at about 0.5 percentage points annually in Brunei Darussalam,Singapore and Thailand.Formal and informal employment On average across ASEAN countries the employment rate among those aged 15-64 is similar to the OECD average,at about 70%in 2022.While the total employme

81、nt rate has been stable ion average n ASEAN countries over the last decade,employment has shifted from agriculture towards services.Informal employment is large albeit shrinking in most ASEAN countries.On average,two-thirds of workers work informally in ASEAN countries compared to one in nine in OEC

82、D countries on average.In Cambodia and Lao PDR,informal workers make around 90%of total employment,13 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 around 80%in Indonesia,Myanmar and Philippines and slightly less than 70%in Viet Nam and Thailand.In Brunei Darussalam,Malaysia and Singapore

83、 most workers are formal.Informal employment is much more widespread in ASEAN countries than what could be expected based on its association with the level of economic development proxied by GDP-per-capita.This suggests that the reasons behind such a large informality are deeply engrained in societi

84、es,and that,contrary to the view that prevailed decades ago,economic development alone will not suffice to seriously tackle the issue.Informality in ASEAN countries is driven by multiple factors:high share of agriculture;exemptions provided by labour codes,social-security regulations and tax laws gr

85、anted to some firms or workers;poor law enforcement;tedious and inefficient administrative business procedures;substantial costs of formalisation;and,unclear benefits brought by formal employment as perceived by workers.Large informality generates huge social challenges as the vast majority of infor

86、mal workers suffer from very limited protection against the risks of income losses related to illness,disability and old age.These issues are becoming bigger as populations age.Informality also limits public financial resources and distorts competition.Macroeconomics Population ageing will put heavy

87、 strain on public finance and,in particular,on financing pensions,health and long-term care.Public debt as a share of GDP is currently large in Lao PDR and Singapore.Indonesia has an effective fiscal framework based on the parameters of the Maastricht treaty and Malaysia is also taking important ste

88、ps to strengthen fiscal sustainability.Large current account deficits generate risks of macroeconomic imbalances in Cambodia and Lao PDR.1.2.Demographic changes among ASEAN countries Population structures are changing fast among ASEAN countries,with rapid decline in fertility rates and continued imp

89、rovements in life expectancy at older ages.This section first highlights the large cross-country variations in projections of the growth of the working-age populations.It then focuses on the recent declining fertility rates and increases in old-age life expectancy,resulting in an acceleration of pop

90、ulation ageing prospects.Finally,it shows that household sizes are shrinking but that multigenerational families are still commonplace in many ASEAN countries.1.2.1.Contrasted trends in the working-age population among ASEAN countries There are huge differences across countries in the projected chan

91、ge in the size of the working-age population(aged 20-64).Projections based on UN data show it increasing by about 25%or more in Cambodia,Lao PDR and the Philippines and by about 20%in Malaysia by 2064,meaning that these countries still experience a positive demographic dividend(Figure 1.1).By contra

92、st,the size of the working-age population would fall by about 30%in both Singapore and Thailand and remain about stable in the other ASEAN countries.A fall of 30%over 40 years,for example,means that the working-age population would decline by 0.9%annually on average,lowering potential GDP proportion

93、ally in the absence of offsetting measures.By comparison,the projected working-age population is projected to decrease by 13%in the OECD on average by 2064,i.e.by 0.3%per year.It would fall by nearly 50%in Korea in total and also by more than 30%in Estonia,Greece,Italy,Japan,Latvia,Lithuania,Poland,

94、the Slovak Republic and Spain as well as in non-OECD China.Only Australia,Israel and Mexico,as well as India would record an increase of over 10%.14 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Figure 1.1.Sharp projected fall in the size of the working-age population in Singapore and Tha

95、iland Change in the working-age population(20-64),2024-64,percentage Source:United Nations World Population Prospects:The 2024 Revision.All ASEAN countries have seen considerable growth in their working-age population over the last 40 years with an average annual increase of 2.1%(Figure 1.2),from a

96、low of 1.6%in Thailand and a high of 3.5%in Cambodia.However,over the next 40 years the annual projected growth is under 0.2%across the ASEAN region.In all countries the growth rate will be much lower than in the past.Large declines in the growth of the working-age population are projected in Brunei

97、 Darussalam,Cambodia,Malaysia and Thailand,and especially in Singapore from an annual increase of 2.2%on average between 1984 and 2024 to a shrinkage of 0.9%between 2024 and 2064.The working-age population is also projected to shrink in the next 40 years in Thailand(-1.0%annually on average),Brunei

98、Darussalam(-0.2%)and Viet Nam(-0.1%).Only Cambodia(0.8%),Lao PDR(0.8%)and the Philippines(0.5%)are projected to record an average annual growth of the working-age population above 0.5%between 2024 and 2064.Figure 1.2.The rate of growth of the working-age population is falling Average annual change i

99、n working-age(20-64)population by time period Source:United Nations World Population Prospects:The 2024 Revision.-50-40-30-20-100102030405060-3%-2%-1%0%1%2%3%4%2024-20641984-2024 15 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 1.2.2.Sharp fall in fertility rates and continued gains in li

100、fe expectancy Fertility rates fell sharply from high levels in ASEAN countries and have kept decreasing in recent years.The total fertility rate(TFR)averaged 6.0 across ASEAN countries in the early 1960s,but this average fell to 2.4 around the start of the millennium and is now at 1.8,below the popu

101、lation replacement rate of 2.1(Table 1.1).This downward trend is projected to continue,though at a much slower rate,with the TFR across ASEAN countries projected to be 1.7 in 40 years compared to 1.5 in the OECD on average.Some ASEAN countries still have TFRs above replacement level.In the early 196

102、0s the TFR was above 5.0 in nine of the ten countries.By 2004,the TFR had virtually halved in all countries,and in Singapore and Thailand to even lower at 1.1 and 1.6,respectively.By contrast,Cambodia,Lao PDR and the Philippines still had a rate above 3.2.Currently only Cambodia and Lao PDR are abov

103、e the replacement level,with Indonesia and Myanmar at 2.1.All the others are below 2.0 with a recent very large fall in the Philippines from 3.5 to 1.9 over the last two decades and Singapore at a level that is one of the lowest in the world at 1.0.Declining fertility is a global phenomenon,but the

104、speed of the decline is more profound in ASEAN countries than in the OECD,although from a much higher level.Table 1.1.Total fertility rate,1964-2064 1964 1984 2004 2024 2044 2064 1964 1984 2004 2024 2044 2064 Brunei Darussalam 6.56 3.59 2.01 1.74 1.62 1.62 Australia 2.94 1.89 1.84 1.64 1.64 1.63 Cam

105、bodia 6.27 6.31 3.24 2.55 2.12 1.92 China 6.58 2.59 1.62 1.01 1.16 1.24 Indonesia 5.53 3.69 2.45 2.11 1.88 1.80 EU27 2.53 1.84 1.48 1.42 1.49 1.52 Lao PDR 6.28 6.28 3.67 2.39 1.94 1.80 India 5.87 4.38 2.95 1.96 1.78 1.73 Malaysia 5.83 3.81 2.38 1.54 1.52 1.54 Japan 2.11 1.72 1.26 1.21 1.33 1.40 Myan

106、mar 5.89 4.31 2.52 2.10 1.86 1.78 Korea 4.92 1.73 1.12 0.73 0.98 1.13 Philippines 6.82 4.69 3.46 1.90 1.76 1.71 New Zealand 3.51 1.93 1.94 1.66 1.62 1.62 Singapore 4.65 1.57 1.06 0.96 1.10 1.24 United States 2.96 1.85 2.02 1.62 1.64 1.64 Thailand 6.24 2.45 1.64 1.20 1.27 1.35 Viet Nam 6.14 4.23 1.89

107、 1.88 1.77 1.72 OECD 3.20 2.03 1.66 1.46 1.51 1.53 ASEAN average 6.02 4.09 2.43 1.84 1.68 1.65 Note:The data refers to 5-year periods whose endpoint is indicated in the first row of the table.Source:United Nations,Department of Economic and Social Affairs,(2024).World Population Prospects 2024,Onlin

108、e Edition(for future periods:medium-variant projection).Changes in future fertility rates may have significant implications for future economic growth and pension finances in particular.For example,pay-as-you-go pensions are financed by current contributions,which means shrinking working-age populat

109、ions will result in a shortfall in pension revenues unless contribution rates are increased or pension benefits are cut.However,there is large uncertainty about future fertility rates.Indeed,projecting fertility is notoriously difficult and past estimates of fertility levels for today have proved to

110、 be wide of the mark.For example,the 2002 UN populations prospects data projected that the TFR in Thailand in 2020-25 would be 1.85,much higher than 1.20 currently.Similarly,the estimates for Cambodia,Lao PDR,Malaysia and Singapore were all at least 0.4 higher than the levels reached currently.Likew

111、ise,over the last two decades,UN projections of fertility levels in 2040-45 have been considerably revised downwards.The average fertility rate across all ASEAN countries was projected to be 1.91 in 2045 based on the 2002 revision of the World Population Prospects dataset.This average for the year 2

112、045 declined to 1.81 based on the 2012 revision and to 1.68 for the 2024 revision(Figure 1.3).The sharpest downward 16 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 revisions,by around 0.6-0.7 overall between the 2002 and 2024 revisions,were found in Singapore and Thailand.The fall of 0.5

113、 percentage points in the Philippines between the 2012 and 2024 revisions reflects the huge recent fall in current levels as discussed above.Figure 1.3.Total Fertility Rate projections from different UN datasets Total Fertility Rate projections for 2040-45 under medium fertility scenario Note:For 20

114、24 the data correspond to 2044 as shown in Table 1.1.Projections for a number of countries including the Philippines converged to 1.85 for the 2040-45 estimate in 2002,which was much lower than the estimate in 2012 that does not have such a convergence.Source:United Nations,Department of Economic an

115、d Social Affairs,World Population Prospects various years.Life-expectancy gains are not projected to slow on average.Over the last 40 years remaining life expectancy at age 65 has increased from 13.2 years on average across the ASEAN countries to 16.3 years in 2024,an increase of 3.1 years.1 It is p

116、rojected to further increase by 3.1 years over the next 40 years reaching 19.4 years in 2064(Figure 1.4).The pace of improvements is projected to slow in Singapore and Thailand,but these two countries recorded the fastest increases in old-age life-expectancy over the last 40 years at 7.1 and 5.3 yea

117、rs,respectively.In Cambodia,life expectancy at age 65 is also projected to increase more slowly,by 2.3 years over the next 40 years compared to 3.3 years over the last 40 years.All the other ASEAN countries show a projected acceleration.By contrast,across the OECD on average there was an increase of

118、 4.6 years over the last 40 years,which would slow to 3.8 years over the next 40 years.11.21.41.61.822.22.4BruneiDarussalamCambodiaIndonesiaLao PDRMalaysiaMyanmarPhilippinesSingaporeThailandViet NamASEANUN-2002UN-2012UN-2024 17 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Figure 1.4.Life

119、-expectancy gains are not projected to slow in most ASEAN countries Remaining period life expectancy at age 65,years Source:United Nations World Population Prospects:The 2024 Revision.With continued trends of lower fertility rates and longer lives,the old-age to working-age ratio will increase sharp

120、ly placing additional burdens on the working-age population to finance pay-as-you-go pensions and healthcare for older people.Indeed,ASEAN populations will be ageing twice as faster as in the OECD on average.Today,ASEAN countries are still relatively young and ageing takes place at a later stage tha

121、n in OECD countries.However,based on current projections,it will take only 36 years for ASEAN countries on average to go from 15 to 40 people aged 65+per 100 people aged 20-64 compared to 74 years for the OECD(Figure 1.5).Ageing on this measure will be the fastest in Thailand and Brunei Darussalam a

122、t only 23 and 25 years,respectively,comparable to the fastest ageing country in the OECD,Korea,which is projected to take 23 years,and quicker than Japan where it actually took 30 years between 1980 and 2010;Cambodia,Indonesia and Myanmar are projected to take between 50 years and 62 years.Looking a

123、t OECD countries,Finland,France,Greece,Italy and Portugal more recently reached this 40-to-100 ratio.By contrast,the pace of ageing is particularly slow in Australia,New Zealand and the United States,all of which are projected to take about 90 years.This is due to relatively high fertility rates in

124、New Zealand and the United States and high levels of immigration of younger workers,particularly in Australia and the United States.This much faster pace of ageing for ASEAN countries highlights the challenges they face to establish both adequate social security systems for older people and an effec

125、tive institutional setting for long-term care facilities(Chapter 3).05101520253020241984206418 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Figure 1.5.The pace of ageing is much faster in ASEAN than in OECD countries Duration,in years,taken to move from 15 to 40 people aged 65+per 100 ag

126、ed 20-64 Note:On the bars,the earliest date refers to point at which the ratio is 15,with the latter date refers to a ratio of 40.For New Zealand the ratio of 15 was reached much earlier than 1950,but this is the earliest point for the UN data,at which point New Zealand already had a ratio of 16.5.R

127、eading Note:In Viet Nam for example there were 15 people aged 65+per 100 people aged 20-64 in 2025 and this ratio is projected to reach 40 in 2055,taking a total of 30 years whilst in the EU on average the same transition is projected to have taken 75 years from 1955 to 2030.Source:United Nations Wo

128、rld Population Prospects:The 2024 Revision.1.2.3.Ageing is set to accelerate ASEAN countries are currently much younger than OECD countries.There are currently 13.5 individuals aged 65 and over for every 100 persons of working age(20 to 64)across all ASEAN countries compared to 32.6 on average acros

129、s the OECD(Table 1.2).All ASEAN countries are within a narrow range between 8.4 and 12.4 except for Singapore(19.8),Thailand(24.0)and Viet Nam(15.0).Chile,Colombia,Costa Rica,Mexico and Trkiye are the only OECD countries below the level of Thailand with Japan being highest at 54.9.The pace of ageing

130、 is projected to be much faster in ASEAN countries compared to within the OECD over the next decades.Over the next 30 years the ASEAN old-age to working-age ratio is projected to increase by 19 percentage points(p.p.)compared to an increase of less than 6 percentage points for the previous 30 years.

131、The old-age to working-age ratio is projected to at least double in all ASEAN countries over the next 30 years with Brunei Darussalam increasing to over 3 times the current level.The acceleration of ageing will also take place in the OECD but a bit more slowly.In the OECD the increase in the old-age

132、 to working-age ratio is projected to be 23 percentage points compared to 12 percentage points over the previous 30 years.2094209320812089206320792063205520472057203720462039204220302034206920112030203720322036203120482027204420312025201920322014195519501955195519602033198120072015010203040506070809

133、0100 19 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Table 1.2.Demographic old-age to working-age ratio:Historical and projected values,1964-2084 Old-age to working-age ratio is the number of people aged 65+per 100 aged 20-64 1964 1994 2024 2054 2084 1964 1994 2024 2054 2084 Brunei Darus

134、salam 8.1 4.7 10.5 37.0 51.3 Australia 16.1 19.7 30.4 45.2 51.8 Cambodia 6.4 6.1 11.2 22.6 35.1 China 8.0 10.1 23.1 64.2 115.9 Indonesia 5.7 8.6 12.2 27.3 41.8 EU27 17.1 22.7 35.6 59.3 67.2 Lao PDR 6.3 8.1 8.4 18.7 37.1 India 7.7 8.6 12.0 27.1 51.4 Malaysia 6.6 7.2 12.4 31.6 57.0 Japan 10.8 22.6 54.

135、9 80.0 81.6 Myanmar 7.8 9.4 12.1 24.0 36.2 Korea 7.3 9.0 29.3 84.5 122.0 Philippines 5.6 6.3 9.7 19.9 45.1 New Zealand 16.7 19.8 29.5 45.4 58.1 Singapore 6.1 8.8 19.8 51.0 94.0 United States 17.8 21.0 30.8 42.9 52.7 Thailand 6.6 7.9 24.0 56.7 74.0 Viet Nam 11.4 11.7 15.0 39.4 56.6 OECD 15.9 20.8 32.

136、6 55.2 67.7 ASEAN average 7.1 7.9 13.5 32.8 52.8 Source:United Nations World Population Prospects:The 2024 Revision.Although ageing trends are largely common across countries,the range of old-age to working-age ratios among ASEAN countries is projected to widen rapidly during the first half of the 2

137、1st century.During the late 20th century,all ASEAN countries followed a similar pattern with an old-age to working-age between 5 and 15 people aged 65+for every 100 aged 20 to 64.The old-age to working-age ratio started to increase in ASEAN countries around the mid-2010s as the falls in fertility Le

138、vels 20-30 years earlier started to have an impact(Figure 1.6 Panel A).Moreover,by 2060,the range is projected to widen to a low of 24 in the Philippines and a high of 66 in Singapore and 61 in Thailand,indicating that the economic pressure from population ageing will differ considerably between cou

139、ntries.2 The range in the OECD is projected to be even larger with an upper rate of 95 in Korea in 2060(Figure 1.6 Panel B).Korea has gone from the youngest country in the OECD in 1950 to the oldest from 2050 onwards based on this metric.20 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Fi

140、gure 1.6.The old-age to working-age ratio is accelerating Number of people older than 65 years per 100 people of working age(2064),19502100 Note:The centre lines are the ASEAN and OECD average old-age to working-age ratios.The shaded area indicates the range between the country with the lowest old-a

141、ge to working-age ratio and the country with the highest old-age to working-age ratio.Source:United Nations World Population Prospects:The 2024 Revision.There has been a gradual shift in the nature of ageing from previous decades.To show the full change it is useful to compare the age distribution o

142、f the ASEAN countries today to those of the past(1994)and the future(2054)(Figure 1.7).Between 1994 and 2024 the most significant increases across age groups was concentrated amongst those of middle-ages(35-65).However,based on current projections over the next 30 years,there will be fewer individua

143、ls of any age until 35 years,as well as a much smaller increase among those aged 35-65.Ageing over the next 30 years will mean a significant increase amongst the 60+age group.These trends explain the acceleration in the old-age to working-age ratios shown above.Panel B.OECDPanel A.ASEAN0204060801001

144、20Max-min(ratio)OECD average(ratio)KoreaKoreaColombiaMexicoIsraelIrelandSwedenJapan020406080100120Max-min(ratio)ASEAN average(ratio)Viet NamThailandSingaporeIndonesiaLao PDRCambodia 21 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Figure 1.7.Large increases in the number of older-age peop

145、le in the coming decades Total population by year of age for all ASEAN countries Source:United Nations World Population Prospects:The 2024 Revision.Migration has helped alleviate the ageing pressure in many ASEAN countries.The projections of the old-age to working-age ratios presented above are base

146、d on a medium variant migration projection scenario.An alternative zero migration projection is also provided within the UN 2024 data.The importance of migration flows can be highlighted by comparing these two scenarios.Based on this comparison,the impact of migration on the extent of ageing is larg

147、e in Malaysia,Thailand and particularly Singapore,and in Brunei Darussalam to a lesser extent,but the impact is limited in the other ASEAN countries(Figure 1.8).By 2054,with zero net migration,the old-age to working-age ratio would be between 2 and 5 percentage points higher in these four highlighte

148、d countries.By 2084,the impact is much larger,7 percentage points higher in Brunei Darussalam,13 percentage points in Malaysia,16 percentage points in Thailand and 29 percentage points in Singapore,which already has a large migrant labour force.0246810121405101520253035404550556065707580859095100+Po

149、pulation(millions)Age19942024205422 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Figure 1.8.Migration has a large impact on the pace of ageing in Malaysia,Singapore and Thailand Change in the old-age to working-age ratio between the zero and medium variant migration scenarios,p.p Source:

150、United Nations World Population Prospects:The 2024 Revision.1.2.4.Declining household sizes Household sizes have been shrinking over recent decades in all ASEAN countries.Household sizes have fallen by around 0.8 people over the last 20 years within ASEAN countries,with Lao PDR recording the largest

151、 fall from 6.0 people on average in 2000 to 4.7 in 2017(Figure 1.9).Although there is no data available for China and Malaysia after 2000 both countries had seen falling sizes in the preceding 20 years,by 1.0 and 0.6,respectively.As populations age there will therefore be fewer immediate family memb

152、ers to provide the traditional familial support that has been common in ASEAN countries.Of all the countries shown in the below figure,Australia,New Zealand and the United States have had almost stable sizes although from initially low levels.-505101520253035PhilippinesLao PDRViet NamMyanmarCambodia

153、IndonesiaBruneiDarussalamMalaysiaThailandSingapore20842054 23 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Figure 1.9.Smaller household sizes over time Average number of people per household Note:Data beyond 2000 is not available for China or Malaysia and no data is available for Brunei

154、Darussalam.Source:United Nations,Department of Economic and Social Affairs,Household Size&Composition,2022.Multigenerational households are still common in ASEAN countries.In 2020,39%of all households contained at least two generations of related members aged 20 or over,whereas in most OECD countrie

155、s for which data are available the share is below 20%(United Nations,20221).Overall,three-generation households three or more generations of related members,irrespective of age account for 22%of all ASEAN households.The proportion of women within older age groups has been fairly steady over the last

156、 40 years,accounting for more than 50%of the population in all older age groups(Figure 1.10).The share of women has increased by 2 percentage points on average for the 75-89 age group between 1984 and 2024,increasing from 58%to 60%and by 1 percentage point for the 90+age group,while remaining fairly

157、 constant at 53%for the age group 60-74.Cambodia,Lao PDR,Malaysia and Singapore have all had a declining share of women across all age groups between 1984 and 2024 while the share has been growing in Indonesia,Myanmar and Viet Nam among all three age groups.Female heads of households are becoming mo

158、re common.Between 2000 and 2020 the proportion of households with a female head increased from 19.4%to 24.3%across ASEAN countries,compared to an increase from 33.8%to 39.0%across the OECD(United Nations,20221).Whilst these women are often single mothers many will be elderly single as a result of ha

159、ving outlived their spouses.These elderly single will be more vulnerable to poverty having been less likely to have their own pension entitlements and will be reliant on both state and family support.23456LatestAround 200024 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Figure 1.10.The pr

160、oportion of women at older ages has been fairly stable Percentage of women within the age group Source:United Nations World Population Prospects:The 2024 Revision.1.3.Overall economy 1.3.1.Low-income ASEAN countries have been catching up ASEAN countries represent a very heterogeneous group economica

161、lly.Measured by GDP-per-capita,even in Purchasing Power Parity(PPP)terms,economic development is 26 times greater in Singapore than in Myanmar(Figure 1.11).Figure 1.11.GDP-per-capita among ASEAN countries,2023,US$PPP Source:2023 IMF World Economic Outlook.40%50%60%70%80%90%MalaysiaSingaporeBrunei Da

162、russalamLaosIndonesiaASEANThailandPhilippinesMyanmarViet NamCambodiaMalaysiaBrunei DarussalamSingaporeLaosThailandASEANMyanmarIndonesiaCambodiaPhilippinesViet NamBrunei DarussalamMalaysiaThailandLaosASEANSingaporeCambodiaMyanmarIndonesiaPhilippinesViet Nam60-7475-8990+202419844 0008 00016 00032 0006

163、4 000128 000MyanmarCambodiaLao PDRPhilippinesViet NamIndonesiaThailandMalaysiaBruneiDarussalamSingapore 25 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 In terms of GDP-per-capita,Brunei Darussalam and Singapore compare with the richest OECD countries,while for all the other ASEAN countri

164、es except Malaysia and Thailand,GDP-per-capita is lower than in Colombia,which has the lowest level among OECD countries(Figure 1.12).Thailands standard of living(measured by GDP-per-capita in PPP terms)compares with that in Latin American OECD countries while Malaysias is close to that in Greece,La

165、tvia,the Slovak Republic or Trkiye.Figure 1.12.GDP-per-capita in ASEAN and OECD countries,2023,US$PPP(Log)Source:2023 IMF World Economic Outlook.Such differences are due to huge variation in economic performance and to a much smaller extent in demographics.Indeed,while Brunei Darussalam and Singapor

166、e have the highest share of the working population(aged 20-64)in total population,the range across countries is relatively small:from 55-56%in Cambodia,Lao PDR and the Philippines to 64%in Brunei Darussalam and 68%in Singapore.Adjusting for the share of the working-age population reduces cross-count

167、ry differences to some extent:there is still a very large 1-to-21 range in terms of GDP per working-age population between Singapore and Myanmar compared with the aforementioned 1-to-26 range in GDP-per-capita.Economic catch-up over the past 25 years has,however,substantially reduced these overall i

168、ncome gaps.For example,in 1998,GDP-per-capita in Brunei Darussalam and Singapore were 87 and 50 times that of Myanmar compared to 14 and 26,respectively,in 2023.Average annual growth in real GDP-per-capita over that period was 7.4%or higher in Cambodia,Lao PDR,Myanmar and Viet Nam(Figure 1.13)it was

169、 9.5%in China.Among ASEAN and selected OECD countries,there has been a clear negative relationship between initial(1998)real-GDP levels and growth over the last 25 years,consistent with the notion of economic convergence.The strong correlation between economic growth and initial income levels transl

170、ates into an annual speed of convergence of 1.4%,which implies,if maintained over the long term,that half of the initial gap in GDP-per-capita between two countries is eliminated after 41 years.3 Since 2010,however,the catch-up process has stalled in Indonesia and the Philippines(OECD,20242).4 0008

171、00016 00032 00064 000128 00026 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Figure 1.13.Higher economic growth for low-income countries among ASEAN Member States Average annual real growth in GDP-per-capita over 1998-2023(y-axis)vs.initial(in 1998)GDP-per-capita level(in log,x-axis)Sourc

172、e:OECD calculations based on 2023 IMF World Economic Outlook.1.3.2.Public expenditure is low but ageing will put heavy pressure in some countries Public spending is low in ASEAN countries,which limits the scope of social protection.Public expenditure was equal to 21.5%of GDP on average across ASEAN

173、Member States in 2023,about half the ratio in the OECD on average(42.0%)(Figure 1.14).Differences in economic development may explain part of this pattern,but even the richest ASEAN countries spend a small share of GDP.While lags in economic development limit the capacity to raise tax revenues,there

174、 is no correlation across countries between the levels of GDP-per-capita and public expenditure as a share of GDP,neither among ASEAN countries alone nor among OECD countries alone.For example,Singapore is both the richest ASEAN country and the one with the lowest public expenditure ratio.Cambodia s

175、pends 27.1%of GDP,the second highest after Brunei Darussalam,while it is the second poorest based on GDP-per-capita.In the OECD,the four countries with the lowest level of GDP-per-capita(Chile,Colombia,Costa Rica and Mexico)do tend to have lower spending,at 35%of GDP or less,but among the other coun

176、tries there is no negative correlation between the levels of economic development and public expenditure.BRNKHMIDNLAOMYSMMRPHLSGPTHAVNMAUSCHNEU27JPNKORUSAINDNZLASEANy=-0.0138x+0.1768R=0.75280.0%1.0%2.0%3.0%4.0%5.0%6.0%7.0%8.0%9.0%10.0%6789101112 27 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA

177、 2025 Figure 1.14.Public expenditure,percentage GDP,2023 Source:OECD calculations based on 2023 IMF World Economic Outlook.Population ageing will put heavy strain on public finance and,in particular,on financing pensions,health and long-term care.Public spending as a share of GDP is projected to sig

178、nificantly increase in most countries,driven by the acceleration in old-age to working-age ratios which raises spending levels(numerator)and may put downward pressure on GDP in some countries(denominator).Under unchanged pension policies,ageing directly increases the GDP share of spending from defin

179、ed benefit PAYG pensions while it reduces monthly benefits in defined contribution schemes.However,most studies find only a limited effect of demographics on the past growth of health expenditure compared to non-demographic effects(Rouzet et al.,20193),as what matters most for healthcare expenditure

180、s are the death-related costs,and therefore the share of a countrys population being close to death(Marino et al.,20174).Changes in incomes and the associated demand for higher quality services have been the main reason behind increases in health spending in the past decades.The share of pension and

181、 healthcare expenditure in GDP will raise sharply in some ASEAN countries.The projected increase will exceed 10 percentage points between 2022 and 2060 in Malaysia,Thailand and Viet Nam,as well as in China and Korea(Figure 1.15).It would be much smaller,although still significant,in Indonesia,the Ph

182、ilippines and Singapore,as well as in Japan,reflecting differences in the pace of ageing,the scope of healthcare and pension systems and measures already taken to deal with ageing challenges.Under an unchanged policy scenario,the tax burden would have to rise sharply to keep debt-to-GDP ratios const

183、ant in many countries(Guillemette and Turner,20185).010203040506028 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Figure 1.15.Age-related public expenditures to increase sharply in some ASEAN countries Pension and healthcare spending as a percentage of GDP Source:S&P Global:Global Aging 2

184、023:The Clock Ticks.1.3.3.General government debt and current account balances over the past decades Public debt levels paint a contrasted picture across ASEAN countries.Brunei Darussalam is an outlier with basically no debt.The two most indebted countries are Lao PDR and Singapore,with strong incre

185、ases in the size of debt as a share of GDP over the last two decades(Figure 1.16)despite low spending as shown above.Given its low development level,the high debt level in Lao PDR(larger than 120%of GDP)raises some concerns in terms of its fiscal space to expand social protection.The size of public

186、debt in Indonesia was strongly reduced from 87%of GDP in 2000 in the wake of the Asian crisis of the late 1990s to below 60%in 2003 and 39%in 2023.Indonesia applies the parameters from the Maastricht Treaty(3%of GDP for the fiscal deficit and 60%of GDP for the total government debt).Those rules rela

187、xed during COVID-19 have been very effective in maintaining general government debt at sustainable levels and pushing down government bond yields(Pulugan and Listiyanto,20216).Malaysia is also taking important steps to strengthen fiscal sustainability.The new fiscal framework established by the Publ

188、ic Finance and Fiscal Responsibility Act may be instrumental to face fiscal challenges driven by population ageing(OECD,20247).05101520253020602022 29 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Figure 1.16.General government debt as a percentage of GDP Source:OECD calculations based on

189、 2023 IMF World Economic Outlook.Large current account deficits generate risks of macroeconomic imbalances in Cambodia and Lao PDR.Over the past decade,the current account deficit has exceeded 10%of GDP in both countries(Figure 1.17).In the case of Lao PDR,this adds to the large mounting public debt

190、 highlighted above.In addition,over the last decade on average,the annual general government net lending was close to a deficit of 4%of GDP in Lao PDR,pointing at twin-deficit weaknesses.4 By contrast,Malaysia and Thailand have recorded persistently large current-account surpluses,and even significa

191、ntly more for Brunei Darussalam and Singapore where the average annual surplus over the last decade has exceeded 13%of GDP.Figure 1.17.Current account balance,percentage GDP,annual average 2014-23 Source:OECD calculations based on 2023 IMF World Economic Outlook.05010015020025030020232000-20-15-10-5

192、0510152030 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 1.4.Formal and informal employment 1.4.1.Stable total employment rates with shifts from agriculture to services On average across ASEAN countries the share of people working,both formally and informally,among those aged 15-64 was 70

193、%in 2022,similar to the OECD average at 69%.However,while total employment rates increased substantially in the OECD from 64%in 2010,they were broadly stable among ASEAN countries on average(Figure 1.18).5 In 2022,employment rates stood at 70%or more in Cambodia,Singapore,Thailand and Viet Nam while

194、 they were 65%or less in Brunei Darussalam,Myanmar and the Philippines.Figure 1.18.Employment rate has been stable in ASEAN countries over the last decade Employment to population ratio,aged 15-64 Note:Data for 2023 in Singapore,2017 in Malaysia,2015 in Myanmar and 2014 in Brunei Darussalam.Source:O

195、ECD database,ILO database,Malaysia Institute of Labour Market Information and Analysis,Singapore Manpower Research and Statistics Department.Many workers at all ages work in agriculture in most ASEAN countries,but overall employment is shifting strongly towards services.In all ASEAN countries except

196、 Brunei Darussalam,Malaysia and Singapore more than 20%of workers still work in agriculture,with as much as 70%in Lao PDR and 46%Myanmar in 2022(Figure 1.19).On average,agriculture employs 28%of workers in ASEAN countries compared to less than 5%in the OECD,43%in India and 23%in China.In other parts

197、 of the world,Eastern and Southern Africa show even a higher share of agriculture at 56%,followed by Western and Central Africa at 45%.With similar average shares of industry in ASEAN and OECD countries at 21%and 22%,respectively the higher share of agriculture in ASEAN countries means a lower share

198、 of services.The employment share of agriculture in ASEAN countries has been declining fast.In 2022,at 28%it was substantially lower than its 2010 level of 35%on average(World Bank,20248).As an example,there has been a striking shift in Malaysia in recent decades,from agriculture to manufacturing an

199、d services.In the 1960s,agriculture contributed to more than 30%of GDP.The 1980s saw the beginning of a massive industrialisation process,driven by substantial foreign direct investment in manufacturing,mainly from Japan and the United States.In the following decades the services sector expanded rap

200、idly,and it accounted for 58%of GDP in 2022,compared to 24%for manufacturing.40%45%50%55%60%65%70%75%80%85%90%2022 or latest2010 or around 31 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Figure 1.19.Many workers in ASEAN countries still work in agriculture Formal and informal workers by

201、sectors,2022 Note:Averages for Middle East and North Africa,and Latin America and the Caribbean exclude high income countries from these regions.Source:World Development Indicators,World Bank,https:/databank.worldbank.org.1.4.2.Informal employment is large but shrinking The definition and measuremen

202、t of informal work is not straightforward.The informal sector includes all enterprises and self-entrepreneurs that produce legal good and services but are not compliant with labour,fiscal and administrative laws and regulations(OECD/ERIA,20189).There are different degrees of informality,from unregis

203、tered enterprises and self-entrepreneurs with no relations with the public administration(total informality)to enterprises that are registered and acknowledged by the public administration but that are not fully compliant(partial informality).Measuring informal economic activity is inherently diffic

204、ult because informality,by definition,cannot be tracked by official registers,and often takes place in diffused small businesses that might evade formalisation.Small-scale operations often remain below employment or turnover thresholds required for registration,paying taxes or social security contri

205、butions,and many businesses can legally be informal.Moreover,some businesses choose to remain unregistered to avoid paying taxes and social security contributions.Both the ILO and the OECD similarly apply different criteria to classify employees and non-employees as informal(OECD/ILO,201910).Employe

206、es are informal when they do not benefit from paid annual leave and paid sick leave and when their employer does not contribute to a pension scheme.Hence,informal employees may work also in formal companies that is,formally registered e.g.with tax authorities,especially when they do not benefit from

207、 relevant insurance schemes.The self-employed are informal when they do not belong to the formal sector(that is,their economic unit is not registered with the competent authorities).People who assist another household member to operate a family business or a farm,or to perform a job as employees or

208、dependent contractors,the so-called“contributing family workers”,are always considered informal(Kolev,La and Manfredi,202311;Frosch and Gardner,202312).Informal employment is larger in ASEAN countries than what would be expected based on its simple association with economic development level measure

209、d by GDP-per-capita,with the exception of Malaysia(Figure 1.20,Panel A).Indeed,the observed relation between informality and GDP-per-capita is strong across countries,even though causality may run both ways,with GDP growth reducing informal employment and vice versa(Duarte,201613).In principle,natio

210、nal statistical offices account for the informal activities when measuring GDP,but countries differ in how they adjust GDP and some informal activities elude measurement(Andrews,Caldera Snchez and Johansson,201114).As informality is 0102030405060708090100AgricultureIndustryServices32 PROMOTING ACTIV

211、E AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 larger in low-income countries,the failure to correct for informality in estimating GDP may mechanically contribute to the correlation between the share of informal employment and GDP-per-capita.Based on cross-country estimates,the levels of GDP-per-capita i

212、n Indonesia and Thailand would imply a share of informal in total employment of 51%and 40%,respectively,while it is much higher at 80%and 64%.On average,two-thirds of workers work informally in ASEAN countries compared to one in nine in OECD countries on average(Figure 1.20,Panel B).6 In Cambodia an

213、d Lao PDR,informal workers make around 90%of total employment,while they make around 80%in Indonesia,Myanmar and Philippines and slightly less than 70%in Viet Nam and Thailand.By contrast,in Brunei Darussalam and Malaysia,only one-third and one-quarter of workers are informal,respectively and also i

214、n Singapore most workers are formal(Sciortino,202115).In Brunei Darussalam and Singapore,informal employment concerns mainly migrant workers,who account for about one-third of all workers in each country and are not mandatorily covered by social security(Ministry of Finance and Economy,202416;Minist

215、ry of Manpower,202417).Since 2015,the situation has improved substantially in Indonesia,Malaysia,Thailand and Viet Nam,where the share of informal employment declined by 4,8,10 and 7 percentage points,respectively.In Thailand,the National Statistical Office(202318)confirms a substantial decline of i

216、nformal employment from 63%to 51%of total employment between 2012 and 2022,even though the absolute levels suggest a lower incidence of informal employment,than based on ILO data at 65%in 2018.The share of the informal economy in total output,of 25%on average across ASEAN countries,is much smaller t

217、han its share in employment(Figure 1.20,Panel C).This is because informal employment often takes place in formal enterprises and informal work is often less productive than formal work.However,this remains higher than the OECD average at 18%.Among OECD countries in Asia-Pacific,the share of the info

218、rmal economy in total output is at 12%or less in Australia,Japan and New Zealand,while it is 23%in Korea,which is higher than in Indonesia,Lao PDR Myanmar,Singapore and Viet Nam.Between 1990 and 2020,the share of the informal economy has fallen substantially in all ASEAN countries,from 40%to 25%of o

219、utput on average.The largest decreases are recorded in Cambodia,Lao PDR and Myanmar by 19,21 and 49 percentage points,respectively.The declining trend of the shadow economy has taken place more generally around the world(Quiros-Romero,Alexander and Ribarsky,202119).33 PROMOTING ACTIVE AGEING IN SOUT

220、HEAST ASIA OECD/ERIA 2025 Figure 1.20.Informal employment is widespread but declining in some ASEAN countries Note:Panel B:Data for Philippines based on Nguyen and Cunha(201920),while Malaysia on World Bank(202421).For calculating the ASEAN average in 2015 or around values the 2022 or latest data we

221、re used for the Philippines.Panel C:World Bank estimates on the share of informal output in GDP are based multiple indicators multiple causes model.Due to data availability,the OECD-33 average does not include Canda,Israel,Japan,New Zealand and the United States.Source:ILO(202422),Elgin et al.(20212

222、3),data on GDP-per-capita from 2019,IMF(see Section 1.2).Informality differs by sector,urbanisation level,age and education(Nguyen and Cunha,201920).First,more than 84%of informal workers are employed by informal firms,10%by formal enterprises and 6%by households.Second,informal work is common in al

223、l sectors,while being more prevalent still in agriculture:across ASEAN countries,96%of workers in agriculture are informal against 73%and 71%in industry and services,respectively.In total,44%of informal workers work in agriculture in ASEAN countries,against 19%in industry and 37%in services.Third,in

224、formal employment is more prevalent in rural areas than in non-rural areas:the share of informal workers in rural areas is higher by 28 percentage points than in non-rural areas in Viet Nam and between 10 and 20 points in Cambodia,Indonesia,Lao PDR,Myanmar,Philippines and Thailand.Fourth,on average

225、across ASEAN countries,the incidence of informal work is similar among men and women.7 Fifth,informal employment is slightly more common among people younger than 25 and older than 55.8 Sixth,in ASEAN countries,89%of workers with primary education Panel B:Share of informal employment in total employ

226、mentPanel C:Share of informal output in GDPPanel A:Share of informal employment vs GDP-per-capita(PPP)BRNIDNKHMLAOMMRTHAVNMPHLMYS0102030405060708090100-10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000Informal employment(%of total)GDP pc PPP01020304050607080901002022 or latest2015 or around010

227、20304050607080901002020199034 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 work informal,while this is the case for 43%of workers with tertiary education.Additionally,Quiros-Romero,Alexander and Ribarsky(202119)point out that most studies show that wages in the informal sector are lower

228、than in the formal sector,but this is largely related to lower education levels of informal workers.Arnold et al.(202424)show that informal workers rarely belong to households including formal workers resulting in limited social protection for whole households of informal workers.The very large scop

229、e of informality complicates the measurement of unemployment.For example,many job-seekers in low-income countries often undertake some informal work for few hours a week,such as selling vegetables from their own garden,and they thereby are counted as workers(Dewan and Pee,200725).This can partly exp

230、lain why unemployment rates are low in ASEAN countries.In 2022,it stood at below 3%on average across countries,which was twice lower than the OECD average.The low unemployment rate varied from less than 1%in Cambodia and Thailand to 5.2%in Brunei Darussalam.Indeed,unemployment rates do not capture u

231、nderemployment,which is likely to be an important driver of poverty.When in 2021 Nigeria stopped including within unemployment both people working fewer than 20 hours a week and agriculture workers producing goods only for their own consumption,the unemployment rate declined from 33%to 5%(Lain and P

232、ape,202326).1.4.3.Causes and consequences of informal work Labour codes,social-security and tax laws do not mandatorily cover all workers in ASEAN countries.Exceptions are provided,in particular to those working in small companies,the self-employed,migrants as well as part-time,temporary or seasonal

233、 workers.Nguyen and Cunha(201920)provide a few examples of such exemptions.The mandatory social insurance scheme in Viet Nam covers only employees with at least a one-month contract.In Myanmar,in the private sector,social security only covers mandatorily the companies with more than five employees.I

234、n Cambodia,social protection coverage was,until recently,only applied to enterprises with more than eight employees.Domestic workers are typically not protected by national labour legislation and do not work under the same conditions as other workers in terms of employment conditions and wages,which

235、 affects their access to social security.Even when registration is mandatory for firms or workers,the enforcement of the rules is often weak.Nguyen and Cunha(201920)assess that the labour and social protection inspection mechanisms in some ASEAN Member States are relatively weak,particularly so in L

236、ao PDR;moreover,some countries do not ensure regular labour or tax inspections and do not apply regular penalties on companies for employing workers informally.Labour inspectors often lack sufficient resources in ASEAN countries and do not have the right to control enterprises for which the registra

237、tion obligation does not apply,even if they employ workers informally.Many firms are small and short-lived,which makes it difficult to track them,at least in Indonesia(UN,202227).Tedious administrative processes of registration and reporting create a barrier for the formalisation of work.For example

238、,in Myanmar,the system for business registration is considered complicated and fragmented by employers,which leads to inefficiencies and disincentives for firms to enter the formal economy(Nguyen and Cunha,201920).Also in Myanmar,the difficulties in registering an activity in the business register,i

239、n turn,often blocks the registration of workers in social security.On top,rigid formal rules might be difficult to be respected by the self-employed,seasonal workers and agriculture workers whose income fluctuates substantially during the year.When the system is perceived as corrupt,inefficient or i

240、neffective,workers and companies are less inclined to formalise.For example,many workers did not join the social insurance scheme in Viet Nam because they perceived it as financially depleted(Nguyen and Cunha,201920).More generally,informal businesses are often not well informed about the benefits o

241、f formalisation(OECD,202028).Informal enterprises often favour the advantages brought by informality while workers might underestimate the benefits of formalisation and have limited opportunities for formal employment.Workers and employers 35 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025

242、easily see the costs of formalising while the benefits are often diluted,in particular when social services are under-developed and social security is perceived as not providing value for money.Additionally,low-productive firms may not break even if they were to pay full social contributions and tax

243、es and obey minimum-wage regulations(Arnold et al.,202424).Similarly,substantial taxes and social contributions can be difficult to pay by low-income individuals working informally.This is particularly the case in the agriculture,where both low pay and informality are widespread.If the costs of form

244、alisation push workers disposable income to very low levels,then the benefits of formalisation are unlikely to be accepted.In Lao PDR and Myanmar,the lack of employment opportunities in the manufacturing and services sectors keep workers in agriculture,in small farms in particular(Nguyen and Cunha,2

245、01920).Benefits of formalisation are even less compelling to workers as formal employment rarely provides any protection against unemployment or access to active labour market policies in ASEAN countries.Unemployment insurance is not well developed:it does not exist in Brunei Darussalam,Cambodia,Ind

246、onesia,Myanmar,Philippines and Singapore,and covers only a few percent of workers in Lao PDR and Malaysia.9 By contrast,around two-thirds of workers are covered in Thailand and Viet Nam where unemployment insurance was introduced before 2010(ILO,202429).Cambodia,Indonesia,Malaysia and Philippines in

247、troduced unemployment insurance over the last six years,while Singapore has only announced plans,in 2024,to introduce it.Only about half of countries worldwide offer unemployment insurance(Obinger and Schmitt,202130).By contrast,OECD countries spend 0.6%of GDP on unemployment benefits on average.Mor

248、eover,active labour market policies which provide support to jobseekers to increase employment opportunities and improve matching them to available jobs are also underdeveloped among ASEAN countries.The average expenditure on active labour market policies stood at 0.05%of the GDP in 2019,more than 1

249、0 times less than among OECD countries.Proper instruments to help workers find new jobs and improve their employability are becoming even more instrumental to prolong working lives as technological progress is rapidly changing the skill requirements of jobs.Platform work,which has expanded recently

250、around the world,reinforces informality,although platforms by themselves are registered and precisely record work.In ASEAN countries,platform workers are not considered employees and,therefore,they largely work informally,without being covered by social protection schemes(ASEAN,202231).However,inter

251、net platforms may facilitate insurance coverage.For examples,Indonesia introduced a digital mechanism to improve access to accident insurance for taxi rides.When using the application,a small part of the tariff includes fees for accident insurance(ILO and OECD,201832).The vast majority of informal w

252、orkers suffers from very limited protection against the risks of income losses related to illness,disability and old age.This is because most of them are not covered by contribution-based social protection while safety nets are often underdeveloped.For example,the share of active contributors to the

253、 pension system as a percentage of the labour force varies from around 60%in Brunei Darussalam,Malaysia,Singapore and Thailand to less than 20%in Indonesia and Myanmar(Chapter 3).The low social protection coverage of informal workers became even more severe during the COVID-19 pandemic.10 This is a

254、vicious circle because,at the aggregate level,informality limits the financial capacity to provide social protection by narrowing the tax base.Informality also limits access to both training and skill development and protection by labour regulations including the minimum wage.Informal workers report

255、 being frequently exposed to long hours and hazardous working conditions(Fleischer et al.,201833).The challenges posed by informal employment are becoming even more pressing in the population-ageing context as discussed in Chapter 4.Informality distorts competition.Informal enterprises or those outs

256、ourcing part of the production to informal entities have lower operating costs.This competitive advantage tends to hinder the expansion of formal enterprises.Lower labour costs and limited access to external financing of informal enterprises skew production towards more labour-intensive processes an

257、d have a negative impact on capital accumulation,36 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 innovation and technological progress(OECD/ERIA,20189).By accentuating competitive advantages in labour-intensive products,informality hinders moving up the product ladder.1.5.Does ageing low

258、er income and productivity growth?1.5.1.Channels through which ageing affects GDP-per-capita Ageing is expected to substantially lower the growth rates of GDP-per-capita.The direct channel through which long-term income prospects are negatively affected by population ageing is through the lower shar

259、e of the working-age population in total population.This is the flip side in countries who benefited from large demographic dividends when that share was increasing.While pension systems are strained by ageing through the increase in the old-age to working-age ratios,the demographic indicator that m

260、atters more to capture the impact of demographic shifts on ageing is the young-age and old-age to working-age ratio this is often referred to as the“total(demographic)dependency ratio”,which is the complement of the share of the working-age in total population.The old-age to working-age ratio has gr

261、adually increased over the past decades and is now accelerating.However,the young-age to working-age ratio has decreased sharply and the fall is now slowing down substantially as fertility rates are already“relatively”low.The total effect for ASEAN countries on average has been a decline of the youn

262、g-age and old-age to working-age ratio(“growth demographic dividend”)to reach a trough in the mid-2030s,from which it will gradually increase(Figure 1.21).Figure 1.21 Demographics to weigh on the growth of GDP-per-capita as the increase in the number of older people is no longer more than offset by

263、fewer children Young-age(0-19)and old-age(65+)to working-age(20-64)ratios on average among ASEAN countries,percentage Note:The demographic young-age and old-age to working-age ratio is defined as the number of individuals aged 0-19 and 65 and over per 100 people aged between 20 and 64.Source:United

264、Nations,Department of Economic and Social Affairs(2022),World Population Prospects 2022,Online Edition(for future periods:medium-variant forecast).This means that the mechanical effect of demographics on the growth of GDP-per-capita has been positive,but this positive effect is expected to disappear

265、 in the near future,except in Cambodia,Lao PDR and the 020406080100120140Old-age to working-age ratioYoung-age to working-age ratioYoung-&old-age to working-age ratio 37 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Philippines.More precisely,the mechanical effect has contributed to the a

266、nnual growth in real GDP-per-capita of 0.6 percentage point among ASEAN countries on average over the last three decades and will be a drag of 0.1 percentage points over the next three decades based on current demographic projections.The drag will be large at about 0.5 percentage points in Brunei Da

267、russalam,Singapore and Thailand.The increase in the“total dependency ratio”until 2070 is smaller than that in the old-age to working-age ratio as the continued decline in the young-age ratio is projected to offset half of the latter in ASEAN countries on average(Table 1.3).The slowing down in the yo

268、ung-age ratio is less abrupt in Lao PDR and the Philippines,and Cambodia to a lesser extent.The fall in the“total dependency ratio”was similar across countries since 1980,between 52 and 72 points,except in Singapore where it was 30 points.The increase until 2070 will be very strong in Singapore and

269、Thailand,and relatively large in Brunei Darussalam,Malaysia and Viet Nam(Table 1.3).Table 1.3.Young-age and old-age to working-age ratios in ASEAN countries Demographic ratios over the past 45 years and projected over the next 45 years Young-age to working-age ratio Old-age to working-age ratio Youn

270、g-age and old-age to working-age ratio 1980 2025 2070 1980 2025 2070 1980 2025 2070 Brunei Darussalam 106.3 41.9 36.2 5.9 11.1 47.8 112.1 53.0 84.0 Cambodia 136.4 70.5 44.6 7.8 11.6 28.0 144.2 82.2 72.7 Indonesia 113.8 54.2 39.2 8.1 12.6 33.6 121.9 66.8 72.8 Lao PDR 128.4 70.2 40.3 8.0 8.6 28.9 136.

271、5 78.8 69.2 Malaysia 110.1 46.2 34.3 7.4 12.8 47.0 117.5 58.9 81.4 Myanmar 108.1 53.0 39.5 8.9 12.4 30.9 117.1 65.5 70.4 Philippines 139.8 64.4 36.2 6.5 10.0 31.8 146.3 74.3 68.0 Singapore 67.1 24.5 28.6 8.3 20.6 99.0 75.4 45.1 127.6 Thailand 108.5 32.0 29.4 7.1 25.2 66.0 115.5 57.1 95.4 Viet Nam 11

272、8.2 50.1 35.5 12.3 15.7 45.7 130.5 65.8 81.2 ASEAN 113.7 50.7 36.4 8.0 14.1 45.9 121.7 64.7 82.3 Note:The demographic young-age and old-age to working-age ratio is defined as the number of individuals aged 0-19 and 65 and over per 100 people aged between 20 and 64.Source:United Nations,Department of

273、 Economic and Social Affairs(2022),World Population Prospects 2022,Online Edition(for future periods:medium-variant forecast).This direct negative effect of ageing on GDP-per-capita can be offset or magnified depending on the evolution of the total employment rate,average hours worked and hourly lab

274、our productivity.Indeed,GDP-per-capita(GDP pc)is the product of hourly labour productivity(LP),the aggregate employment rate(ER),average hours worked per worker(H)and the share of the working-age in total population():=.=where POP,L and WA denote,respectively,total population,total employment and th

275、e working-age population.One key policy response to longevity trends is to boost total employment,and in particular at older ages where there remains large potential in many countries.In some,there is also some wide margins to raise female or youth employment.Beyond more employment,the impact of age

276、ing on GDP-per-capita will depend on how labour productivity is affected.If ageing lowers labour-productivity growth,this will add to the negative effect from the lower share of the working-age population.By contrast,if ageing were to raise productivity growth,this would at least partially offset th

277、e direct demographic effect.38 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Measuring labour productivity at the individual level is notoriously difficult.The standard view is that productivity increases with age until the early 50s and then decreases at older ages.This is the result of

278、better experience with age and,at some points in the second part of the career,deteriorating health,the obsolescence of skills and a lower capacity to innovate and adapt to innovations.Hence,shifts in the age structure of the working-age population are likely to affect aggregate labour productivity.

279、However,even based on this standard age profile of productivity,the total impact is not straightforward as that profile is non-monotonous,combined with unprecise levels e.g.beyond age 60.Moreover,labour productivity has two main components:one is total factor productivity(TFP)and the other is captur

280、ed by the capital-labour ratio and influenced by the substitution between capital and labour.Even if ageing were to lower TFP growth,it may be associated with labour shortages and lower interest rates,which would raise the capital-labour ratio through labour-saving investments,with the total effect

281、being undetermined.The substitution of capital to labour may be especially relevant for automatable tasks or jobs.1.5.2.Mixed evidence of the impact of ageing on income and productivity growth The evidence on the overall effect of the shift in the age structure of the working-age population on aggre

282、gate productivity is mixed.Aiyar,Ebeke and Shao(201634)find that the ageing of the workforce,measured by the increase in the share of workers aged 55-64 in the total workforce,has significantly reduced labour productivity growth in the European Union since the mid-1990s through its effect on TFP gro

283、wth.Gagnon,Johannsen and Lopez-Salido(202135)find that the impact of demographic factors on GDP growth in the United States between 1960 and 2015 was positive in the 1960s and 1970s,negative from the 1980s,and basically accounts for the total slowdown in the GDP-growth trend since the 1980s.Their es

284、timated large impact comes directly,almost one-to-one,from the lower growth in the size of the working-age populations,with very limited effect from lower TFP growth and capital-labour substitution.By contrast,Acemoglu and Rastrepo(201736)show,across both OECD and non-OECD countries,that ageing is n

285、ot associated with lower growth in GDP-per-capita.This implies that the declining share of the working-age population has been offset by higher labour productivity and/or higher employment rates.These authors highlight that countries where ageing has been faster are characterised by a higher rate of

286、 technology adoption,which can therefore be considered the market response to increasing labour shortages and upward pressure on wages.There is evidence that countries(e.g.Germany,Korea)undergoing a more rapid ageing of their workforces have experienced a faster development and adoption of automatio

287、n technologies since the 1990s(Rouzet et al.,20193).Acemoglu and Rastrepo(202237)show that rapidly ageing countries have invested significantly more in new robotic and automation technologies,and provide evidence suggesting that this is due to the implied scarcity of middle-aged workers and that ind

288、ustrial automation is indeed most substitutable with middle-aged workers.Among OECD countries,Japan and Korea stand out as examples of rapidly ageing societies with a significant reliance on robotics(Andr,Gal and Schief,202438).Alongside Singapore,they are the top three adopters of robots in manufac

289、turing,and Japan alone accounts for 47%of global robot production.Brsch-Supan,Hunkler and Weiss(202139)find no decline in average productivity in the age range 20-60.However,some inefficiencies may lead to ageing still exerting downward pressure on GDP.The adoption of labour-saving technologies(capi

290、tal deepening)driven by ageing has operated through lower interest rates,resulting from a possible combination of labour shortages and excess saving.This mechanism breaks down when the adjustment of interest rates is constrained by a lower bound on nominal rates,limiting investment and the possibili

291、ty to absorb excess savings.Eggertsson,Lancastre and Summers(201940)find that this happened during the decade of the Great Financial Crisis,consistent with the secular stagnation hypothesis.So,if ageing pushes interest rates down structurally such that the zero lower bound becomes effective,lower gr

292、owth of output-per-capita would result.Additionally,wealth may become more concentrated among older people,who tend to have larger savings.As older people are more risk averse 39 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 and more likely to invest in real estate or government bonds ins

293、tead of financial investments that are more productive,less risk-taking overall may slow down growth and innovation(Andr,Gal and Schief,202438).Moreover,in some Asian countries in particular,seniority-based wage settings,which remains the norm e.g.in Japan and Korea,leads to the decoupling of wage a

294、nd productivity at older ages.As ageing increases the share of older workers,this inefficient channel is poised to play a larger role,impeding GDP growth.Another channel through which ageing may affect aggregate productivity is through the demand side,i.e.shifts in the aggregate consumption basket(A

295、ndr,Gal and Schief,202438).In particular,it is expected that ageing increases the shares of some services with low-productivity growth in total demand,such as housing and long-term care,which would tend to lower aggregate productivity.Ultimately,the impact of ageing on income growth will depend on t

296、he relative magnitudes of:declining employment-to-population ratios;rising capital per worker;and,productivity growth,which in turn depends on the pace of innovation,technology adoption and human capital investments induced by ageing(Rouzet et al.,20193).As ageing has started to accelerate in many O

297、ECD countries over the last decade and will continue at a fast pace in the forthcoming decades,the respective weights of these three factors will change.Hence,evidence about the aggregate effect of ageing in the past may provide little guidance about the aggregate effect in the future.Also,ASEAN cou

298、ntries are following their own ageing patterns,with very fast ageing in some of them.Overall,ASEAN and OECD countries that have aged faster over the last two decades have not faced lower productivity growth.There is indeed no significant relationship between the pace of ageing and labour productivit

299、y growth since 2005(Figure 1.22).This is despite the fact that Singapore and Thailand,as well as Japan within the OECD,have been ageing fast and recorded low productivity growth.40 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Figure 1.22.There is no relationship between speed of ageing a

300、nd productivity growth Annual growth rate of GDP per hour worked and pace of ageing,2005-24 Note:In these charts,the old-age to working-age ratio is defined as those aged 65 or above as a percentage of the population between 20 and 64.Source:ILO modelled estimates and United Nations World Population

301、 Prospects.The 2024 revision.1.5.3.Future challenges for ASEAN countries Ageing fast and at an early stage of economic development means that ASEAN countries have less time and resources to adopt the technological innovations that could raise productivity in an ageing society.Overall,ASEAN countries

302、 are much less technology-ready than OECD countries.The World Economic Forums(WEF)indices on technological readiness and innovation are part of the WEFs database on key determinants of productivity and competitiveness.These indices give a score between 1(worst)and 7(best)on technological readiness a

303、nd innovation based on a range of variables.While OECD countries score 5.7 on technological readiness and 4.5 on innovation on average,ASEAN countries only score 4.0 and 3.6,respectively,on average(Figure 1.23).Singapore is above the OECD average while Cambodia,Lao PDR and Myanmar have the lowest sc

304、ores.Lagging behind is partially due to lower levels of economic development.Fast ageing may make it harder for ASEAN countries to catch up on technology and innovation.DEUAUSITAUSAFRAKORJPN-2%0%2%4%6%8%10%0510152025Panel B:OECDBRNKHMIDNLAOMYSMMRPHLSGPTHAVNM-2%0%2%4%6%8%10%0510152025Panel A:ASEANCha

305、nge in old-age to working-age ratio(p.p.)Change in old-age to working-age ratio(p.p.)41 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 Figure 1.23.ASEAN countries are less prepared for technology and innovation than OECD countries Technology Readiness Index and Innovation Index,1(worst)-7(

306、best),2017 or latest available Note:The technological readiness index measures the agility with which an economy adopts existing technologies to enhance the productivity of its industries,while the innovation index measures the extent to which an economy is conducive to innovative activity.Index sco

307、res are calculated based on a weighted average of several relevant indicators.Data is 2017 for all countries except Myanmar(2015).Source:World Economic Forums Global Competitiveness Index(2017).Moreover,some ASEAN countries seem to be unprepared to innovate fast enough to sustain productivity growth

308、 given ageing prospects in the forthcoming decades.Based on Chomik and Piggotts(202141)comparison of countries speed of ageing by 2050 and their current score on the WEFs Innovation Index,OECD countries are generally above world average in both ageing speed and innovation,as are Malaysia and Singapo

309、re.However,Thailand and Viet Nam are significantly above world average on ageing speed but not on innovation.Most other ASEAN countries are still below the world average for both dimensions.References Acemoglu,D.and P.Rastrepo(2022),Demographics and Automation.37 Acemoglu,D.and P.Rastrepo(2017),Secu

310、lar Stagnation?The Effect of Aging on Economic Growth in the Age of Automation.36 Aiyar,S.,C.Ebeke and X.Shao(2016),The Impact of Workforce Aging on European Productivity.34 Andr,C.,P.Gal and M.Schief(2024),Enhancing Productivity and Growth in an Ageing Society:Key Mechanisms and Policy Options.38 A

311、ndrews,D.,A.Caldera Snchez and.Johansson(2011),“Towards a Better Understanding of the Informal Economy”,OECD Economics Department Working Papers,No.873,OECD Publishing,Paris,https:/doi.org/10.1787/5kgb1mf88x28-en.14 Arnold,J.et al.(2024),“Towards better social protection for more workers in Latin Am

312、erica:Challenges and policy considerations”,OECD Economics Department Working Papers,No.1804,OECD Publishing,Paris,https:/doi.org/10.1787/76a04c6f-en.24 01234567Technological Readiness IndexInnovation Index42 PROMOTING ACTIVE AGEING IN SOUTHEAST ASIA OECD/ERIA 2025 ASEAN(2022),The Asean.Promoting De

313、cent Work and Protecting Informal Workers.,https:/asean.org/wp-content/uploads/2022/05/The-ASEAN-Magazine-Issue-21-2022-Informal-Economy.pdf.31 Brsch-Supan,A.,C.Hunkler and M.Weiss(2021),Big data at work:Age and labor productivity in the service sector.39 Chomik,R.and J.Piggott(2021),“Population Age

314、ing,Productivity and Technological Change in Asia”,China:An International Journal,Vol.19/3,pp.33-52,https:/doi.org/10.1353/chn.2021.0027.41 Dewan,S.and P.Pee(2007),Beyond the Employment/Unemployment Dichotomy:Measuring the Quality of Employment in Low Income Countries,https:/www.ilo.org/wcmsp5/group

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