Asia-Pacific labour market insights

Getting older: Confronting Asia and the Pacific’s ageing labour force

Asia and the Pacific’s ageing population is a trend that is expected to steadily increase. Ageing societies means older labour forces and higher old-age dependency ratios, increasing the pressures on economies to close pension and social protection coverage gaps.

Analysis | 08 September 2021

The median age of all ASEAN +61 countries labour force is rising, with the pace expected to accelerate significantly over the next 10 years in countries such as Lao People’s Democratic Republic, Malaysia and Viet Nam. Ageing societies lead to increases in old-age dependency ratios, measured as the size of the older population (65+) as a share of the prime working-age population (15-64). Japan has the highest ratio, with almost half of the working population being elderly.

With ageing populations comes increased pressure on national pension systems. The consequences of a rapidly ageing society differ between high-income countries with sufficient capacity for universal pension and/or health care and middle-income countries with limited fiscal resources. The range of persons above the statutory pensionable age receiving an old-age pension among ASEAN +6 runs from above 90 per cent in Japan and New Zealand to less than 20 per cent in Cambodia, Indonesia and Malaysia.2  Despite some progress, pensions systems in the region are not yet up for the challenge of meeting a rising elderly population.3

1 ASEAN+6 comrpises of ASEAN’s 10 countries as well as China, Japan, South Korea, Australia, New Zealand and India.
2 ILO World Social Protection Database.
3 UNESCAP and ILO, The protection we want: Social Outlook for Asia and the Pacific, 2020, Chapter 5.