Aging Workforce in Singapore Essay

Populations in many developed countries are ageing, and Singapore is no exception. The first batch of post-war baby boomers will reach 65 years of age by 2012. The number of seniors will increase from 8.4% in 2005 to 18.7% in 2030 (refer to Table 1). According to the 2010 Population Report,  The proportion of residents (i.e. citizens and PRs) aged 65 and above increased from 7.0% of the resident population in 1999 to 8.8% in 2009. Correspondingly, the number of younger residents aged 15-64 for every resident aged 65 and above (i.e. the old-age support ratio) fell from 10.1 in 1999 to 8.3 in 2009 (refer to Table 2). (Singapore Department of Statistics, 2010, p. 4) Today, one out of every 12 Singaporeans is aged 65 or above. By 2030, this ratio will become one out of five. On January 2011, the parliament has passed down the new employment law of changing to retirement age from 62 to the age of 65 from January 2012. This is a good news to many Singaporeans who felt that they are still capable of working beyond the retirement age of 62 (Nayak, 2011, para. 3). An ageing population brings both challenges and opportunities, having tremendous effect on all parts of our society – individuals, families, communities, businesses and government. Therefore, we ought to prepare early for the challenges of an ageing population to ensure the well-being of our seniors and their families to provide the first line of support. At the same time, we must be ready to seize the economic opportunities that will emerge from the demographic shift. Aging Workforce in the Hotel Industry With relevance to the major demographic trends, aging population, this revolution will change the face of our labour market. Correspondingly, the workforce is not only ageing, but also growing at a much slower pace. Increasingly, companies are facing problems in recruiting replacements for retiring employees. This is a reality that companies have to grapple with and adapt to. Nevertheless, not all companies are being affected equally nor are they moving at the same rate to identify and address how the ageing trend will be impacting their businesses. Impacts In the hospitality industry, service is the factor that differentiates hotels from its competitors. Therefore with a large amount of aging workforce in the frontline, it will bring down the image of the hotel in terms of appearance; a younger worker would look fresher and have a better appeal to guests. As a guest of a hotel overseas, he or she would be preferred to be served by younger workers than people of an old age. As older employees are naturally more prone to illnesses, they would tend to take more medical leaves thus decreasing the manpower. When one gets sick, it affects the employees’ mood to work and thus less concentration when working. This in turn reduces the efficiency of the operations of hotels. In addition, the needs and interest changes with aging workforce. According to the study by Tripartite Alliance for Fair Employment Practices (TAFEP) (2010), â€Å"rising health and insurance costs, concern about physical abilities, and adaptability/willingness were ranked as the top three challenges† (p. 3). With the ever changing preferences and needs of the society, hotels have to constantly upgrade their standard of services. However, older employees may not be equipped with latest skills and knowledge needed to achieve the hotel’s competitive advantage. Thus, there is a need to constantly upgrade the skills of their older employees. Older employees are more resistant to changes and improvements. This may be mainly due to their thinking of already having the appropriate experience and knowledge and there is no need for further training, especially in the situation of â€Å"leapfrogging†, where a younger worker is put in charge of a more experienced worker. Many hotels will have an advantage by having a large pool of elderly employees. It is mainly because there are many job positions which young employees would be unwilling to take up. Most time, foreigners would be hired to fill up the rest of the job vacancies that do not appeal to the young employees; however, hotels can have another avenue of recruitment – the elderly workforce. This will give hotels a great advantage to handpick the best candidates out of the pool of elderly workforce. In hotels, there are certain positions that elderly employees occupy, for example managerial positions. Being loyal to the company, they would not want to leave their positions easily as compared to the younger workforce who usually job hops for a better pay. This relieves the hotel’s need to constantly recruit and train new workers, thus helping to cut the costs during the process of recruitment and training. Challenges A) The Human Resource (HR) unit has a challenge to allocate the older employees in suitable positions that is beneficial for both the hotel and the aging workforce. The HR unit also has to ensure that the hotel would maintain a good image and increases their productivity. There is also a need for the HR unit to create a supportive culture for the older workers in order to manage such diverse workforce. B) Keeping older employees motivated at work along with the right attitude is important when serving their customers. In addition, with the older employees being more prone to illnesses, hotels have to struggle with ways to keep their costs low and at the same time provide adequate medical benefits for them. During such periods it is more crucial for managers and supervisors to show them care and patience. C) Values tend to change from one generation to another as well as during different life stages. The thinking of the older generation is more conservative than those of the younger generation. It would thus be a challenge for the hotels wanting the older employees to improve their values in their job scope. With a more conservative mindset and thinking, they would be afraid to try new things and be more innovative. In turn, the hotel will lose its competitiveness if new changes are adopted. Hence, the HR unit in a hotel has to place their older employees in the most relevant training to help them prepare for changes in their current jobs. Besides that, older employees would normally take a longer time to adapt to changes, thus the management has to work out appropriate schedules to help their employees to have a proper balance with their job and trainings. D) Older employees tend to have more skills and knowledge in the industry due to the experiences they have gone through. Retaining this skills and knowledge is critical for hotels to ensure that the younger generation will also have these basic skills and knowledge as a platform for them to have an advantage over their competitors. E) Although there is a need to retain these skills and knowledge, there will definitely be a time when one has to retire. However, the aging workforce is usually reluctant to leave their positions as they are emotionally attached to the hotel. This would be a challenge for the hotel to find ways to recruit younger employees, without resulting in excess manpower and high costs, especially for positions in the higher management. If the hotel were to retain most of the older employees, they may miss opportunities on recruiting young employees who can be a more valuable asset to the hotels which helps to bring their standards to a higher level. Solutions It is time for employers to start responding to the potential consequences of the ageing workforce on their businesses. If not well-prepared, employers may find themselves suddenly faced with labour loss, experience and expertise that will be difficult to offset, given the relatively small pool of new employees. With many companies facing the same problem, competition for new talents is likely to surface. A) Hotels can have interviews to know which areas older employees would prefer to work in and the languages they can speak. With the information gathered, hotels will be able to know their strengths and weaknesses which help to determine where to allocate each individual. With the proper job assignment, hotels will be able to maintain a good image, by reassigning the older employees with language barriers to the backhouse such as room attendant. This allows them to be in their comfort zone and after getting used to their task, the productivity will be maximized in both the frontline and backhouse. B) In order to keep older employees engaged and motivated, it is vital for the HR department to maintain constant communication with the older employees and understand any problems, issues and concerns that they are encountering. By treating their employees like family members, it may be a major job happiness-driver for them and thus motivating them to do better for the hotel. Besides that, communication and treating each other with respect ensures that the spirit of their employees is always high. Through job empowerment, employees will have more decision making responsibilities and hence they will feel more respected as an employee as they are given a chance to handle more difficult situation on their own. As for medical benefits, hotels can pay a certain percentage of their medical fees. For example, the hotels will pay 50% of their employee’s medical fees while the other 50% is paid by the employees. C) Facing the challenge that older generation is more conservative, companies can focus on creating a positive work environment for older employees by allowing flexible hours, more communication and constantly motivating them. Some of the actions can be allowing the older employees to have an option to consider different jobs and different sets of responsibilities. Some older employees may wish to devote their later career years to jobs that allow them to develop new competencies. Others may want jobs that are less demanding, these older employees may be interested in making transitions to different jobs within the company or make lateral moves or even to lower positions with a pay reduction. Other than that, the hotel can allow them to have a choice over the number of hours worked and provide them with flexible schedule for trainings. For example, older employees work on reduced-hours such as part-time or job sharing, so as to schedule the rest of their time for trainings that are a rranged for them. D) To retain the skills and knowledge, the older employees can train and guide the younger employees before they retire to ensure that the skills and knowledge are passed down. After retirement, they can come back and help out by overlooking and having workshops to give further training that is needed. E) To attract the younger people, creative ways are needed. For example, the hotel can come up with a program like the popular show â€Å"The Apprentice† by Donald Trump to search for the best employee. However, we must ensure there is no excessive pool of manpower and costs are kept low. The hotels can allow their older employees to be on-call workers or have flexible work schedules. On-call workers are employees who are called to work only when needed, although they can be scheduled for work for several days or weeks in a row. In days when the hotels need a massive number of employees, the on-call workers will be called back. By providing flexible work schedules, older employees are allowed to plan their work schedules with the choice over the number of hours worked. This will prolong the retirement period for older employees by allowing them to work but at a lesser duration, so that younger employees have the chance to excel and there will not be a surplus or shortage in th e manpower. Case Study: Royal Plaza on Scott The Royal Plaza on Scott is a 5-star leading hotel in Singapore. 50% of the hotel 300 employees are classified under the mature and older category. The company recognized the importance of mature employees and has sets out strategy as Singapore faces human capital challenge of managing a mature and older workforce. According to Fiat (2010), The mature employees are valuable assets to the organization as they are able to share their wealth of experience with the younger employees. The hotel taps on their expertise by pairing the mature employees with the younger generation of new hires to provide guidance and encourage cohesiveness. The hotel also implemented a buddy system where a new mature employee is paired with a younger co-worker or vice versa to work together and learn from each other. For example, younger employees may learn from mature and older employees on how to handle difficult customers while guiding their older colleagues on the effective usage of technology at the workplace. (TAFEP, p. 45) Royal Plaza on Scott has developed recruitment strategies like implementing Flexible Working Arrangements (FWA), where there is a flexible work arrangement which includes flexi-time, part time, job shares and compressed workweeks. Health benefits and programmes will also be implemented including regular health screening, health talk, yoga courses, sushi-making classes and others. This is to encourage for a healthy work life balance. Another great strategy used is to set up a Recreational Committee that was assigned to take care of the well being of co-worker. This committee will be in charge of organizing health awareness events, initiatives to create awareness of healthy lifestyle as well as to bond employees of difference generations (TAFEP, 2010, p.46).