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Trends and Characteristics of Labor Force Participation Among Older Persons in Developing Asia: Literature Review and Cross-Country Assessment

Abstract

This paper examines the pattern and prospects of labor force participation of older persons in developing Asia. We review relevant literature and conduct a detailed analysis of descriptive statistics drawn from the labor force survey micro data of selected countries in the region. Evidence suggests that the structure of social security and pensions, education and health status of workers, household structures and gender norms, and technological change and adoption at the workplace explain the observed patterns of labor supply among older persons in advanced economies. Some of these factors are equally relevant in developing Asia, while others seem to pose divergent impacts. The restricted coverage and depth of social security and pension schemes likely have limited effect in many countries of developing Asia to date, except in selected areas and among educated older workers. The lack of career options upon the first retirement can also explain the early exit from the labor market among the skilled group. This paper recommends public and private actions that could promote longer working lives in the region.

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Fig. 1

Source: Data on labor force participation rates by age from ILOSTAT for Asian countries and OECD.Stat for the OECD average

Fig. 2

Source: Authors’ illustration using data from labor force surveys of respective countries

Fig. 3
Fig. 4

Source: Authors’ illustration using data from labor force surveys of respective countries

Fig. 5
Fig. 6

Source: Authors’ illustration using data on activity rates by age from Eurostat database

Fig. 7

Source: Authors’ illustration using data from labor force surveys of respective countries

Fig. 8

Source: Authors’ illustration using data from labor force surveys of respective countries

Fig. 9

Source: Authors’ illustration using data from labor force surveys of respective countries

Fig. 10

Source: Authors’ illustration using data from labor force surveys of respective countries

Notes

  1. Developing Asia refers to the 46 member countries of the Asian Development Bank. These are Afghanistan; Armenia; Azerbaijan; Bangladesh; Bhutan; Brunei Darussalam; Cambodia; Cook Islands; Federated States of Micronesia; Fiji; Georgia; Hong Kong, China; India; Indonesia; Kazakhstan; Kiribati; the Kyrgyz Republic; Lao People’s Democratic Republic; Malaysia; Maldives; the Marshall Islands; Mongolia; Myanmar; Nauru; Nepal; Niue; Pakistan; Palau; Papua New Guinea; the People’s Republic of China; the Philippines, the Republic of Korea; Samoa; Singapore; Solomon Islands; Sri Lanka; Taipei,China; Tajikistan; Thailand; Timor-Leste; Tonga; Turkmenistan; Tuvalu; Uzbekistan; Vanuatu; and Viet Nam.

  2. Their study revealed that, among men aged 40–44 in 2007 who are employed in the informal sector, around 76% of them stayed by 2014 while only 7% successfully moved to the formal sector.

  3. Housing wealth plays a significant role in the early retirement among older persons in Germany while non-property wealth is seen driving early retirement in Switzerland (Kuhn et al., 2021).

  4. Due to changes in occupation classifications, many of the skilled agricultural, forestry, and fishery workers have been classified under the elementary occupations.

  5. Examples include the Malaysia Aging and Retirement Survey (MARS), Indonesia Family Life Survey (IFLS), Health, Aging, and Retirement in Thailand (HART), and Survey on Older Persons and Social Health Insurance (OP&SHI) in Vietnam.

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Acknowledgements

The authors would like to thank Rana Hassan, John Piggott, and Paul Vandenburg for their valuable comments to the earlier version of the paper. This paper was presented during the APRU Population Aging Conference 2021 on 07–08 April 2021 and at the ADB-ADBI-JICA Regional Conference on Health and Socioeconomic Well-Being of Older Persons in Developing Asia: Role of Individual and Household Data on 07–09 September 2021 and greatly benefited from the comments of the participants.

Funding

This project has received funding from the Asian Development Bank-administered Japan Fund for Poverty Reduction through the Knowledge and Support Technical Assistance 6556-REG Challenges and Opportunities of Population Aging in Asia: Improving Data and Analysis for Healthy and Productive Aging.

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The lead author (Kikkawa) contributed to the study conception and design, data analysis, and provided overall guidance toward the completion of the manuscript. The second author (Gaspar) was responsible for the data acquisition and analysis. All authors contributed to the previous versions and read and approved the final manuscript.

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Correspondence to Aiko Kikkawa or Raymond Gaspar.

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Kikkawa, A., Gaspar, R. Trends and Characteristics of Labor Force Participation Among Older Persons in Developing Asia: Literature Review and Cross-Country Assessment. Population Ageing (2022). https://doi.org/10.1007/s12062-022-09377-3

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Keywords

  • Developing Asia
  • Labor force participation
  • Older workers
  • Retirement
  • Population aging
  • Pensions