Singapore has a rapidly aging population. Next year we will be a “super aged” country with over one in five aged 65 years old or above. By 2030, one in four Singaporeans will be 65 or older.
The two main factors behind an aging population are longer life expectancy and fewer births.
An aging population heading for population decline
According to the latest data from World Factbook, Singapore has the third lowest total fertility rate (TFR) in the world after Taiwan and South Korea.
Even the 2024 dragon year failed to attract couples to have babies. Last year there were 30,800 resident births – just 300 more than the previous year’s 30,500 newborns. Both 2023 and 2024 have the same historical low TFR of 0.97. We need a minimum TFR of 2.1 for the population to replace itself. By the early 2030s, without immigration, we will face population decline when deaths outnumber births.
What will happen to the growing number of HDB flats left behind by residents passing on? If birth rate is lower by the year, do we still need to build more BTOs?
As an economist from the Singapore University of Social Sciences said, “If you have zero or negative population growth, we would have to radically restructure the way we deal with major policies. For example, some things we take for granted, like new Housing Board flats, may no longer be built because there is not enough people to live in them.”
– “Accept that Singapore has the world’s lowest fertility rate”, PropertySoul.com
“Our government is raising the bar for even higher home ownership in Singapore. Where is the increment coming from? Is it from low-income families, new households formed by the next generation, or approval of citizens, PRs and import of foreigners?
– Vina Ip, Behind The Scenes of The Property Market
Giving away money can’t raise birth rate
To encourage couples to have more children, Budget 2025 announced the new Large Families Scheme. Large families can receive up to $16,000 in additional support for each third and subsequent child born.
Honestly, how confident are we with the new Large Families Scheme to reverse TRF from a low of 0.97?
In fact, Singapore introduced the Baby Bonus Scheme since April 2001. Over the years, the government continued enhancing baby cash bonuses, child development grants and co-matching of parents’ savings.
Despite this, the number of resident births has shrunk over the years from 39,000 in 2001 to 30,500 in 2023. For the dragon year 2000, there were 44,700 babies. In contrast, the latest dragon year in 2024 only has 30,800 resident births.
Similarly, Taiwan tried to get its citizens to have more children by offering cash incentives, tax breaks, six months paid parental leave and 80 percent salary reimbursement. Yet after spending a whopping $3 billion, Taiwan still ends up with the lowest fertility rate in the world.
Obviously, the result shows giving away money to save falling birth rate is not an effective strategy. But when will governments learn the fact that you can’t pay people to have more babies?
Nonetheless, there is silver lining for an aging population. Among the developed countries, both France and Sweden have seen success in reversing declining birth rates. Last year the TRF is 1.9 in France and 1.67 in Sweden.
Alternatively, we can learn from China’s Shenzhen to allow families with two or more children to buy second or third homes. This is attractive to the Chinese who are often crazy about properties. (Read “Reporting from Shenzhen: How China stimulates the property market”)
Raising old-age support ratio for an aging population
A decade ago in 2014, Singapore’s old-age support ratio is 6. That means for every resident aged 65 and above, there are six residents aged 20 to 54. Fast track to 2024, our old-age support ratio has dropped to 3.5. By 2030, it is expected to fall further to 2.7.
To increase the size of the working-age population, Singapore has imported a significant number of foreign workers. By the end of 2024, Singapore has a total foreign workforce of 1.58 million (or 1.27 million excluding domestic workers).
This has successfully alleviated Singapore’s old-age support ratio from 3.5 to 5.2 amid an aging population. No wonder SM Lee said immigration is essential or even existential for Singapore’s survival.
But foreign workers are only giving us the extra workforce and consumption. What about filling up our school places and creating public housing demand?
Last year there were 25,171 resident deaths. In the same year, Singapore granted 23,472 citizenship and 34,391 PRs. At this rate we are going, we should well replace the resident population lost from higher deaths and lower birth rate.
Immigrants come and go
If the foreign workers receive their education and training in their own country, they are saving Singapore’s budget on baby bonuses, child development grants and education subsidies. During their stay in the country, they may not be entitled to citizen or resident benefits such as housing, education, healthcare, pension and tax reliefs.
Yet in their working years in Singapore, these foreigners go to work, pay taxes, spend money and stimulate the economy. In other words, they boost the workforce, improve productivity and contribute to our economy.
The foreign workers may leave one day due to end of employment, retirement or for personal reasons, such as taking care of aging parents back home. If that happens, they won’t be using any elderly care and subsidies which are considerable costs for the country.
According to the Ministry of Home Affairs, an average of 3,370 individuals renounced their PR status annually. Over the past three years, an average of 1,480 citizens renounced their Singapore citizenship every year.
I relocated to Singapore from Hong Kong twenty-seven years ago. Over the years, I have seen many Hong Kong people come and go. Most leave after a year or a few years. None of the singles and young couples I met are still here. Those who stay behind usually married a local or have children being raised here and now working in Singapore.
We look for different things in different stages of life. While we are young, we focus on career advancement and life betterment. When we are no longer young, we treasure precious time with aging parents, family members and old friends. We start missing the good old days. That is why once we reach our 50s, there are many reconnecting and reunions with folks from secondary school, JC, university and army days.
Our ancestors were immigrants too
As a matter of fact, Singapore is an immigrant country where most of our ancestors are immigrants.
According to the 2020 census, the Chinese constituted 74.3 percent of Singapore’s resident population. Chinese migrants were from southern China, particularly Fujian and Guangdong provinces. They left their hometown under economic hardship or political instability to seek a better life here. Many worked in the tin mines and rubber plantations. They worked hard and made sacrifices to create a better future for the next generation.
“The first message that your parents give you when you are immigrants is: This place owes you nothing. You are worth as much as the value you create for this place.” – Oskar Hartmann
Oskar Hartmann, an entrepreneur and investor, is the world’s top twenty angel investors. He is often considered as the pioneer of Russia’s e-commerce. He was born in Kazakhstan and grew up in a refugee camp in Germany.
In a recent interview, he explained why more immigrants succeed than locals.
“The country has an aging population. There is no drive and hunger to push. Because the place is doing well. Kids grow up in a very comfortable way. For example, in Scandinavia, people growing up will say: Why should I take a risk? We are living well. I already have enough.”
I look at my children. Frankly, they are smarter than me. Above all, they have a better family background and a better childhood. They are born with more resources. But there is something missing in them – the hunger and drive to build something from scratch with their own hands. They suffer from complacency and lack of resilience.
Food for thought
It was the first day my younger daughter went back to school after our trip to Hong Kong during the Chinese New Year.
“I felt so sad in school the whole day. I wanted to cry a few times. I miss Hong Kong. I miss the vibes. I don’t want to come back.”
I was taken aback by her words. Singapore is her birthplace. I thought she is comfortable here. No darling. Stay with mommy. You are not going anywhere.
“I know you went to a university built on a mountain. I watched all the online videos about it. One day I also want to study there.”
So you googled my alma mater.
The other day my friend said she wish her daughter would continue her education in Canada. Then find a job there. Don’t come back.
Not for me. I am a traditional Singapore parent. We went through hardships in life and don’t want to see our children suffer. I know how tough it is to be a new immigrant. And it is not until much later in life that you realize what you have really missed over the years.
My children should simply follow others to BTOgether. Then after the minimum occupation period, listen to some property agents to do “asset progression”. Be stuck with a bigger mortgage for the next 25 or 30 years and can’t go anywhere.
My book Behind The Scenes of The Property Market is available for preview and order online.
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