Embracing an ageing population

As an ageing nation, a country will normally experience an increase in life expectancy due to better healthcare services and living standards, as well as a decline in the fertility rate.

The patterns of declining fertility rate and expansion in life expectancy have started to become more obvious in Malaysia.

In 2020, Malaysia’s fertility rate declined to 1.7% compared to 2.1% in 2010.

The total population aged 65 years and over is higher at 6.8% of 32.4 million total population, compared to 5% of 27.5 million during the same period.

Based on the Housing and Population Census 2020, Malaysia was not categorised as an ageing nation then.

However, the Statistics Department projected that 7.3% of the total population would reach the age of 65 and over by 2022.

The ageing population in Malaysia is growing at a faster rate than initially expected in 2030.

It is also anticipated that by 2050, Malaysia’s population aged above 65 will be more than 15%, qualifying Malaysia as an aged nation.

Population ageing is a demographic trend that will significantly influence various public policies.

As the proportion of the old age population becomes larger, the public expenditure will be higher to cover the expected increase in spending on healthcare, pension and long-term care.

In addition, a larger old-age population will cause labour shortages and create potential risk of old-age income security.

In coping with the challenges arising from population ageing, the government, businesses and society at large should be prepared to adapt to the changing needs and structural demographics in the economy.

This is to ensure that no one is left behind while improving the wellbeing of all Malaysians, particularly senior citizens, in line with the Shared Prosperity Vision 2030 and the Sustainable Development Goals.

Malaysia has experienced a rapid demographic change for the past 50 years. The young-age (zero to 14 years) shows a declining trend while the working-age (15 to 64 years) and old-age (65 years and over) indicate the opposite.

Generally, the increase in the working-age population positively implies potential employment supply in the country.

However, a contrasting trend between the young and old-age population suggests that the size of the working-age population will shrink in the long run.

Moreover, further aggravated by the falling birth rates, the country could face difficulties in providing adequate workforce for the labour market, thus impacting the economy.

The increasing dependency of the young-age and old-age population on the working age group is also a concern for Malaysia.

The age dependency ratio is often used to measure the financial pressure of the actively working population of a community.

For the purpose of the analysis pertaining to an ageing nation, the old age dependency ratio (OADR) measures the number of old age per 100 persons of the working age.

A ratio of 10.5 in 2022, higher than 7.5 in 2010, signifies a greater dependency on the working age group.

The reducing workforce composition will increase the burden of the working age in supporting the needs of the young and elderly groups.

Cognisant of Malaysia becoming an ageing nation, the government will continue to enhance the ecosystem for senior citizens.

Society and family also need to play a role in ensuring that the welfare of senior citizens is not neglected.

Under the 12th Malaysia Plan, the government will build more care centres for the elderly, as well as enhance cities to become more senior citizen-friendly in the future.

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age , life expectancy , fertility , population , economy


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