The Change in Singapore Retirement Age Policy: Key Insights and Implications

Singapore will raise the minimum retirement age to 64 and the re-employment age to 69 by July 2026.  Explore how this will impact workers, employers, workforce planning, and the economy.

Retirement is inevitable for most employees; however, a new study by Sun Life Asia reveals that younger generations are opting to retire later and save more. The survey, which gathered responses from over 3,500 participants across Asia Pacific, found that the top reasons for delaying retirement include the need to save more (61%),  the desire to remain active (49%), enjoyment of work (46%), and the rising costs of living (43%).

In Singapore, where the elderly population is steadily increasing, a similar concern is evident. According to a 2023 Statista survey, the labor force participation rate among Singaporeans aged 65 and above has increased over the last decade. When asked about the reasons, 55% of the respondents said they were not financially prepared for old age, and 49% felt unprepared in terms of health and well-being. 

This data is important for understanding Singapore’s labor market and socio-economic landscape, particularly in light of a 2021 Statista survey report that while Singapore has one the highest life expectancies in the world, it also has one of the lowest fertility rates, at 1.15 children per woman. Without intervention, it is estimated that by 2035, around one-third of Singapore's population will be aged 65 and older. 

Following up on this issue, earlier this year, the Ministry of Manpower Singapore announced a change in the retirement age. This policy sparks an interesting discussion in the Singapore business industry.

Retirement Age Policy in Singapore

Initially, from 2022, the minimum retirement age in Singapore stands at 63, and the re-employment age is set at 68. On March 4, 2024, during the Ministry of Manpower’s Committee of Supply 2024, a policy change was announced by Minister of Manpower, Tan See Leng. He stated that the retirement age will increase to 64, and the re-employment age will be raised to 69, with these changes taking effect on July 1, 2026. 

The change in this policy was announced on March 4, 2024, at the Ministry of Manpower Committee of Supply 2024. Minister of Manpower Singapore, Tan See Leng, announced that the Singapore retirement age will rise to 64, and the re-employment age rise to 69. This regulation will be effective starting July 1, 2026. 

The Straits Times reported that with this early announcement, Minister State of Manpower Singapore, Gan Siow Huang, encouraged employers to begin planning for this shift by adjusting workforce structures and prioritizing the upskilling of senior employees. Additionally, The Ministry of Manpower (MOM) will assist companies in the recruitment of older workers and facilitate their skill enhancement.

Public Responses on the Singapore Retirement Age Change

In some other parts of the world, the policy of raising the retirement age elicits a range of responses, with some negative reactions stemming from concerns regarding delayed access to pension funds. However, in Singapore, the upcoming retirement age policy gets a lot of positive feedback.

Gan Siow Huang highlighted that in 2023 only, 90% of senior workers eligible for re-employment expressed a desire to continue working. In Singapore, employment is considered vital for promoting well-being and improving the quality of life for older adults. Because it provides them with financial stability, as well as a sense of purpose and community involvement.  

From a socio-economic perspective, this strategy is also seen as logical. Allowing older individuals to remain in the workforce can positively impact the overall economy. It helps alleviate potential labor shortages that may result from a declining workforce and ensures that the economy continues to benefit from the knowledge and expertise of experienced professionals. 

Therefore, raising the retirement and re-employment age in Singapore can bring a lot of benefits. Furthermore, Seow Hui Goh, partner and head of Bird & Bird’s Singapore Employment Group, told SBR that the opportunity for seniors to work longer, maintain financial independence, and contribute to the economy is seen as culturally and socially positive and advantageous in Singapore.

Concerns About the Policy

Despite the largely positive reception, the new retirement age policy in Singapore is not without concerns. For instance, Ang Tze Phern, partner for the Employment Group at Rajah & Tann, mentioned to SBR that the new policy could exacerbate issues within an inter-generational workforce. Differences in mindset, work ethics, and the growing technology skills gap between younger and older employees may lead to friction. For example, younger workers may view older colleagues as less adaptable, while older employees might feel uncomfortable reporting to younger authorities. 

Age bias also remains a notable issue and concern regarding Singapore's retirement age change. According to the Straits Times, 24% of the 315 discrimination complaints filed to the Tripartite Alliance for Fair and Progressive Employment Practice and MOM between 2018 and 2022 are related to age. 

To address this, one of the Ministry of Manpower’s goals for this year is to create fairer and more inclusive workplaces, including protecting workers from age-related dismissals before reaching the statutory retirement age.

Final Thoughts

In summary, the statistics clearly indicate that Singapore must adapt to its changing demographic, particularly regarding the aging population and slowing workforce growth. As the number of elderly citizens rises, the government recognizes the importance of implementing policies that address this demographic shift. 

By increasing the minimum retirement and re-employment ages, the Singapore government seeks to empower older workers, enabling them to continue contributing professionally for as long as they wish. This initiative not only honors the desires of seniors who want to stay active in the workforce but also acknowledges the valuable experience and skills they offer. 

By providing senior citizens with more secure and diverse employment opportunities and promoting an inclusive labor market that values the contributions of older workers, Singapore can enhance both individual well-being and economic resilience in the face of demographic changes.

Next Read: Work-Life Balance in Singapore: Redefining Work Structure for Modern Workforce