Vietnam's aging workforce on the road to retirement

By    September 7, 2016 | 12:00 pm GMT+7
Vietnam's aging workforce on the road to retirement
A woman wearing traditional conical hat pushes her bicycle past a restaurant. Photo by Reuters

The country is scrambling to turn its aging population into an advantage.

Vietnam's working-age population will shrink so quickly that by 2030 one in six Vietnamese will be over 60 years old, and one in four of the population will be 60 or older by 2060, a top leader has warned.

“It is commonly believed that Vietnam is a young and dynamic country as its golden population is standing at its peak," Deputy Prime Minister Vu Duc Dam said on Tuesday at a workshop on the impacts of an aging population. "But the truth is we are on the threshold of a rapidly aging population.”

People aged 60 or older currently represent about 10.5 percent of the country’s population of over 90 million, said Labor Minister Dao Ngoc Dung.

It is estimated that in the next 50 years Vietnam will have 10 million more in that age group, Dung added.

Demographic transition, which is characterized by a shrinking workforce and aging population, is taking place in Asia-Pacific countries at an unprecedented rate, according to the United Nations Development Program (UNDP).

Countries in Asia and the Pacific are home to more than half of the population aged 60 or older in the world, numbering up to 533 million people, said Lubna Baqi, the deputy director for the Asia and the Pacific Regional Office of the United Nations Population Fund (UNFPA).

The number of older people in the region is expected to jump to nearly 2.5 billion by 2050, representing two thirds of the world’s population aged over 60.

Vietnam is aging faster than expected.

“What took between 60 and 100 years in Europe and North America is set to take only two or three decades in many Asia-Pacific countries, including in Vietnam,” said Bakhodir Burkhanov, UNDP Deputy Country Director in Vietnam, stressing that “the window for action before aging sets in is very limited”.

Vietnam’s golden population is estimated to last about 30 years from 2010 to 2040. But due to a lower birthrate and longer life expectancy, Vietnam is aging rapidly and the working-age population is shrinking.

According to the UNDP, if Vietnam fails to create jobs, develop social security and improve quality of life before the working age population peaks, it will risk instability in the future including a lack of workers and an increased need for health care for the elderly.

In the near term, UNDP suggests Vietnam should boost productivity by raising the mandatory retirement age, which means there will be more working seniors in the future.

It is a smart move to keep older workers in the workforce, said Lubna Baqi.

She advised the Vietnamese government to utilize more senior people in the workplace to boost productivity and make them more active throughout society.

Vietnam is faced with an aging population which requires the Southeast Asian country to optimize its human capital via skills training, improved education and technology transfer, as well as inclusive social protection such as pensions and universal basic healthcare, said Dung, the labor minister.

Aware of the population drift, Vietnam is making efforts to turn its aging population into an advantage, said Deputy Prime Minister Dam.

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>Vietnam may be missing out on “golden population”: UNDP

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