August 26, 2016 11:16 am JST

As Thailand and Singapore go gray, their companies must adapt quickly

KENTARO IWAMOTO and TOMOMI KIKUCHI, Nikkei staff writers

A jogging course on the rooftop of a shopping mall in Bangkok attracts many people, including the elderly. (Photo by Keiichiro Asahara)

BANGKOK/SINGAPORE -- Around 5:30 p.m., when the sun starts to set and the temperature begins to go down, people start gathering on the rooftop jogging course at the CentralFestival EastVille mall in a suburb of Bangkok. One unusual aspect of the 200-meter course, apart from its location, is the people who use it.

Many are seniors, like Puangthong Indrachak, 65, who had come to walk the course with her granddaughter. "I like this place because I can come here with my family and exercise while [the granddaughter's] mother is shopping in the mall," Puangthong said, adding that she comes here two or three times a week.

The course has three lanes -- one for runners, another for joggers and another for walkers -- and is one of the main features of the mall, which opened in November 2015.

The mall's operator is Central Pattana, the developer arm of Thai retail giant Central Group. The company has 30 malls nationwide, but this is its first equipped with a jogging course.

Though it did not build the jogging course with elderly people in mind, the company is now considering products and services that are tailored to older customers. "In the near future, we will market to this segment specifically," said Nattakit Tangpoonsinthana, executive vice president for marketing. "For example, we [plan to] organize a dancing club."

It is a timely strategy, considering Thailand is one of the two most rapidly aging countries in Southeast Asia -- the other being Singapore. According to official data, there were 9.4 million people age 60 or older as of the end of 2015, a nearly 50% increase from the 6.3 million in 2005.

Other traditional Thai companies are already dipping their toes into the silver market. This year, building materials giant Siam Cement Group started marketing a line of housing products for the elderly. One of the main offerings is a toilet the same height as a typical wheelchair, 45 centimeters, so that elderly people can move easily between the two.

For now, Siam Cement is focusing on seniors in Thailand, but it eventually aims to market elderly-friendly products in other Southeast Asian countries. "First, we have to educate the [domestic] market," Chalermdet Likitmanchai, an SCG marketing employee for the elderly care business, said. So far, most customers are younger people buying the products for their parents.

Consumer products conglomerate Saha Group, meanwhile, unveiled a new brand for the 50-and-over set at its yearly product exhibition in July. There were 18 million or so people aged 50 or older in Thailand as of the end of 2015.

Dubbed GoodAge, the new brand includes an easy-to-hold toothbrush and toothpaste that promotes saliva and helps with swallowing.

Saha Group is putting a positive spin on GoodAge. "We promote the brand by using the word 'longevity,' not 'aging,'" said Maneerat Wongratanavichit, who is in charge of marketing the brand.

Targeting the domestic silver market could help Thai companies tap opportunities in neighboring countries, where similar population shifts are on the horizon.

More than windows

For older Singaporeans, morning starts before sunrise. By 6:30, common spaces between the blocks of high-rise public housing are full of middle-aged and elderly people practicing tai chi and other exercises. By 7:30, they pack up and head off for breakfast at a local coffee shop.

Older folks come out later in the morning, often accompanied by young women either helping them walk or pushing their wheelchairs.

These women are domestic helpers hired from nearby countries to take care of household chores. For years, they have played a key role in middle- and upper-income households, as most Singaporean women choose to continue working after having children. As the city-state grapples with one of Asia's most rapidly graying populations, however, more of these workers are starting to double as elderly caretakers.

While most of them learn caretaking skills on the job, some are seeking out training to better equip themselves for these new duties. The Foreign Domestic Worker Association for Social Support and Training, or FAST, recently launched a 45-week training program covering various aspects of elderly care, including fall prevention, cooking and visits to nursing homes.

For domestic helpers, acquiring new skills can help them land a better-paying job or ask for a pay rise from their current employers. Maria, a 37-year-old from the Philippines, currently works for a couple who are both over 65. "I am happy with my family, and I want to take care of them when they get older," she said. "I also want to learn to enhance and develop my skills for the future."

At the same time, pressures on young Singaporeans to provide care for the elderly are rising as the birthrate declines. The competitive nature of the education system coupled with the rising cost of living has made it hard for many families to have more than one or two children. The percentage of citizens age 65 or older was 13.1% in 2015, up from 8.8% in 2005. The old-age support ratio -- the ratio of citizens age 20-64 to those 65 or older -- was 4.9 last year, a significant decline from the 10.4 in 1990.

Some elderly Singaporeans are choosing nursing homes in Malaysia, where the costs are significantly lower.

Spring Valley Homecare is located in Johor Bahru, a 30-minute drive from the Malaysian border. About 60 of its 200 residents are Singaporean. The monthly fee, which includes meals and caretaking, is between 600 and 700 Singapore dollars ($450-$520). Frankie Ker, the home's director, says a similar facility in Singapore would cost at least S$1,500.

Labor pains

Singapore's demographic changes are also causing headaches in the labor market. The city-state has just over 3.3 million citizens, and many jobs, particularly in construction and the service industry, are filled by foreign workers.

But the government has begun tightening foreign labor intake in response to pressure from citizens. During the year ending in June 2015, Singapore accepted only 23,000 new foreign workers, just under a third of the 77,000 admitted in the year through June 2012.

With the country expected to face an increasingly serious labor shortage, the government has been trying to utilize more elderly workers. In 2012, it called on companies to rehire employees who had reached the retirement age of 62 until they turned 65. In July 2017, the retirement age will be raised to 67.

The employment rate of 65- to 69-year-olds is 42%, up from 25% in 2006. In early July, Deputy Prime Minister Tharman Shanmugaratnam said the country will have no retirement age in the future. For now, elderly workers are helping solve Singapore's labor shortage, but it is not a long-term solution.

Some businesses are tackling this issue with technology. At Rong Heng Seafood Restaurant in eastern Singapore, robot waiters work alongside their human counterparts, carrying trays of piping-hot food to hungry customers.

The robots travel on magnetic strips running between the tables and a window that opens to the kitchen. Chefs place the food on the robot's tray, key in the table number, and off the robot goes, stopping automatically whenever someone or something passes in front of it.

The restaurant currently utilizes three robot waiters. Each one costs around S$8,000, but given their lifespan of around 10 years and the hassle of replacing human employees when they quit, they are a good investment, according to Richard Zheng, the restaurant's owner. "Labor turnover is a common problem among food and beverage businesses in Singapore," he said. "We are two staff members short of our usual number, but we can cope because we have the robots."

Okagi Service Robotics, the Singapore-based company that provides the robots, says that while Rong Heng is so far the only local business that has purchased and deployed the robots on a permanent basis, interest in them is rising as labor-intensive industries face worker shortages.

Nikkei staff writer Wataru Yoshida in Singapore contributed to this report.

Asia300

Central Pattana Public Co. Ltd.

Thailand

Market(Ticker): BKK(CPN)
Sector:
Industry:
Finance
Real Estate Development
Market cap(USD): 10,843.07M
Shares: 4,488M
Asia300

The Siam Cement Public Co. Ltd.

Thailand

Market(Ticker): BKK(SCC)
Sector:
Industry:
Process Industries
Chemicals: Specialty
Market cap(USD): 17,597.79M
Shares: 1,200M

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