EMPLOYMENT BEHAVIOUR OF THE ELDERLY IN THAILAND Thuttai Keeratipongpaiboon Department of Economics School of Oriental and African Studies (SOAS), University

EMPLOYMENT BEHAVIOUR OF THE ELDERLY

IN THAILAND

Thuttai KeeratipongpaiboonDepartment of Economics

School of Oriental and African Studies (SOAS), University of London

The 11th IFA Global Conference on Ageing

28 May – 1 June 2012. Prague, the Czech Republic

International Federation on Ageing (IFA)

A part of the CSEAS Project

Structure12 34

22

11

33

IntroductionIntroduction

Old-Age Employment Situation in ThailandOld-Age Employment Situation in Thailand

Determinant of Employment Decisions of the ElderlyDeterminant of Employment Decisions of the Elderly

44 ConclusionConclusion

2

Introduction12 34

• Increasing longevity: longer period of retirement

•Thai elderly people cannot rely on their own savings and invisible pensions: need family supports

•Urbanisation has deteriorated strength of family relationship: what happen to Thai elderly people?

•Possibility: a number of Thai elderly people have to be economically active for their own survival.

•Research aim: to study dynamic of employment behaviour of the elderly in Thailand

Significance of the Research

Methodology

• Data

• Socio-Economic Survey (SES) Data, 1990-2007 (National Statistical Office)

• Survey of the Older Persons in Thailand (SOP), 2007 (National Statistical Office)

• Secondary data from reliable sources

• Methodology

• Descriptive Analysis • Econometric Analysis – using a Probit regression model

3

Situation of Population Ageing in Thailand

Source: United Nations, Department of Economic and Social Affairs, Population Division (2011). World Population Prospects: The 2010 Revision, CD-ROM Edition.

4

Old-age Dependency Ratio is on an upward trend: Thailand has the highest rate in the SEA region12 34

Remark: an old-age dependency ratio is defined as a ratio of population 65+ per 100 population 15-64.

In 2007, the majority are:

• Attaining primary education or less

(91.78%)

• Female (56.27%)

• Household heads (59.87%)

• Married (60.68%)

• Able to go out without assistance

(healthy, 87.08%)

• Not working (58.09%)

• Not living in a household with

pension incomes (94.60%)

• Living in the Northeast (35.39%)

• Living with their children (60.39%)

• Living in three-generational

households (36.92%)

Average age of Thai elderly

increased from 69.15 (1990) to

69.72 years.

Summary of the Elderly in Thailand

Source: author’s own calculation from the 1990-2007 SES data 5

Share of the Elderly by Living Arrangements, Thailand, 1990-2007

Remark: *excluding skipped generation households

12 34

Share of the Elderly by employment situation, Thailand, 1990-2007

• The labour-force participation rates of Thai elderly persons are quite high; higher than the world average.

• Almost one-fifth of Thai females aged 65 and over were found in the workforce in 2005.

• The LFP rates of females are quite high comparatively to Asia, LAC, Economies in Transition and the World.

• The share of elderly in Thailand’s labour force is on an upward trend; increasing from 3.7% to 7.0% during 1986-2006.

Old-Age Employment Situation12 34

6

Labour Force Participation Rates, the World Regions, 2005

Source: United Nations (2007, p.61, Table IV.2), Development in an Ageing World; Author’s own calculation from the ILO’s data, http://laborsta.ilo.org/ accessed on 12 march 2012.

Region/Country1

Age Group

25-54 55-64 65+

Men Women Men Women Men Women

World 95.1 66.7 73.5 38.7 30.2 11.3

Developed Countries 91.9 75.3 63.9 44.9 13.4 6.3

Economies in Transition 90.7 81.3 52.6 31.2 14.2 7.8

Africa 96.2 61.0 86.5 48.3 57.4 25.8

Asia 96.3 64.2 77.6 35.4 38.0 13.2

Latin America and the Caribbean 94.3 64.3 76.1 37.2 37.2 13.7

Oceania 87.4 73.3 76.0 60.6 51.4 33.4

Thailand 95.9 82.2 81.8 65.7 41.0 21.7

Source: summarised from the Ministry of Labour (2007), The Situation of Old-Age Employment in Thailand.

Old-Age Employment Situation12 34Situations of Old-Age Labour Force, Thailand, 1986-2006

Sourc

e:

sum

mari

sed

fro

m t

he M

inis

try o

f La

bour

(20

07

), T

he S

ituati

on o

f O

ld-A

ge E

mp

loym

ent

in T

haila

nd

.

•Trends: more females, more older elderly (65+), better educated.•The majority are self-employed (60.97% in 2006). More elderly people are recently found in the private sector.


8

Old-Age Employment Situations Thailand by Living Arrangements, 2007

Source: author’s own calculation from the 2007 SOP data


9

The Situation of Old-Age Employment in Thailand, by Living Arrangements and Age Group, 2007


5.1

13.8

20.7

35.6

47.3

22.4

29.6

6.7

15.1

21.623.4

35.6

52.1

33.0

6.4

14.1

32.4

55.0

34.0

42.6

45.6

13.7

23.3

31.1

45.0

61.7

33.4

43.0

7.6

16.8

25.1

39.5

53.6

35.6

26.8

0

10

20

30

40

50

60

70

Total Elderly (60+) Total Elderly (65+) 60-64 65-69 70-74 75-79 80 and over

Age Groups (Year)

Per

cent

age

of E

cono

mic

ally

Act

ive

Eld

erly

Per

sons

in

Eac

h A

ge G

roup

(%)

Three-or-More-Generational Households Two-Generational Households (excl. Skipped) Skipped Generation Households

One-Generational Households All Living Arrangements


10

Reasons for Remaining in the Labour Force of the Elderly, by living arrangements, 2007


36.3541.49

34.83 34.60 33.20

51.72 43.86 54.88 57.4154.83

0%

20%

40%

60%

80%

100%

All Living Arrangements Three-or-More-Generational Households

Two-GenerationalHouseholds (exc Skipped)

Skipped GenerationHouseholds

One-GenerationalHouseholds

Still Healthy Looking after themselves/family Looking after their children

Noone can replace the job Not retire yet Having debt

Spend time Help child(ren)/ family members Others


11

Reasons for Leaving the Labour Force of the Elderly, by living arrangements, 2007


9.13 8.59 8.15

19.12

7.03

72.61 77.8071.10

61.12

69.94

0%

20%

40%

60%

80%

100%

All Living Arrangements Three-or-More-GenerationalHouseholds

Two-GenerationalHouseholds (exc Skipped)

Skipped GenerationHouseholds

O ne-GenerationalHouseholds

Household working/ looking after family members Spouse/Child(ren) do not allow to work Waiting for next season

Too old Incapable for work with disability Illness

Voluntary idle Looking or waiting for a job Pension official

To rest Others

Determinant of Old-Age Employment

12

VariablesYear

1990 1994 1998 2004 2007

I. Demographic Factors

- Age -0.027*** -0.028*** -0.029*** -0.029*** -0.028***

(-11.14) (-14.41) (-18.38) (-17.17) (-22.15)

- Secondary Education -0.207*** -0.018 -0.012 -0.014 -0.037

(-3.31) (-0.30) (-0.19) (-0.35) (-1.21)

- Bachelor’s Degree 0.011 -0.107 0.050 -0.038 -0.117***

(0.10) (-1.16) (0.43) (-0.73) (-2.64)

- Master’s Degree or Higher 0.187 -0.024 -0.204**

(1.40) (-0.16) (-2.45)

- Male 0.118*** 0.056* 0.113*** 0.075*** 0.165***

(2.67) (1.72) (4.19) (3.32) (8.83)

- Household Head 0.177*** 0.262*** 0.188*** 0.273*** 0.228***

(3.37) (6.90) (7.11) (12.40) (12.23)

- Married 0.191*** 0.220*** 0.173*** 0.177*** 0.156***

(4.81) (6.87) (7.13) (7.73) (8.42)

- Able to go out by Themselves

without Assistance

0.269***

(10.98)

- Access to Medical Welfare -0.014 0.004

(-0.40) (0.11)

II. Economic Factors

- Pensions (Yes) -0.086 -0.145** -0.066 -0.145*** -0.114***

(-1.23) (-1.99) (-1.27) (-3.05) (-3.09)

- Transfer Payments (Yes) 0.024 -0.026 0.012 -0.026

(0.61) (-0.88) (0.58) (-1.31)

- Poverty (Yes) 0.055 0.093** 0.036 0.080*** 0.024

(1.27) (2.50) (1.01) (2.67) (0.90)

- Savings (Yes) 0.007 -0.017 0.014 -0.003 -0.012

(0.22) (-0.67) (0.60) (-0.21) (-0.73)

VariablesYear

1990 1994 1998 2004 2007

III. Household Characteristics

- Central 0.049 0.050 0.073 0.048 0.126***

(0.61) (0.84) (1.19) (1.40) (3.78)

- North 0.032 -0.022 0.050 0.040 0.122***

(0.39) (-0.38) (0.81) (1.14) (3.53)

- Northeast -0.013 0.055 -0.020 0.058 0.112***

(-0.16) (0.90) (-0.36) (1.62) (3.25)

- South 0.170* 0.081 0.125** 0.127*** 0.187***

(1.84) (1.25) (1.97) (3.21) (4.91)

- Rural -0.073* 0.000 0.013 -0.060*** -0.035**

(-1.65) (0.02) (0.39) (-3.72) (-2.46)

- Live in Three-or-More-

Generational Household

-0.040 -0.017 -0.125*** -0.056*

(-0.69) (-0.41) (-3.07) (-1.84)

- Live in Two-Generational

Household

-0.085 -0.208*** -0.154*** -0.230*** -0.198***

(-1.65) (-5.72) (-5.51) (-9.10) (-9.35)

- Live in Skipped Generation

Household

0.288*** 0.280*** 0.309*** 0.254*** 0.295***

(4.39) (5.92) (7.46) (7.63) (10.00)

- Household Size -0.210*** -0.205*** -0.186*** -0.213*** -0.256***

(-10.76) (-9.73) (-13.61) (-15.37) (-22.38)

- Household In the Agricultural

Sector

0.086** 0.114*** 0.102*** 0.430*** 0.386***

(2.25) (3.57) (4.15) (20.47) (20.59)

- Number of Recipients in

Household

-0.119*** -0.133*** -0.129*** 0.001

(-4.96) (-7.05) (-7.50) (0.12)

- Number of Earners in Household 0.431*** 0.493*** 0.465*** 0.438*** 0.494***

(15.17) (19.82) (23.57) (27.01) (34.02)

Number of Observations 2,279 5,861 6,913 15,478 20,120

Wald Chi-Squared 474.66 894.06 1085.73 1883.94 2785.62

Probability > Chi-Squared 0.0000*** 0.0000*** 0.0000*** 0.0000*** 0.0000***

Pseudo R-Squared 0.4974 0.5670 0.5660 0.6041 0.6240

Log Pseudo-Likelihood -796.59 -1724.72 -1986.62 -4175.35 -5144.71

12 34

Source: author’s own calculation from the 1990-2007 SES data

Determinant of Old-Age Employment

13

Significant Factors:

•Demographic Factors: age(-), male(+), household head(+), married(+),

healthy(+)

•Economic Factors: pensions(-), poverty(+)

•Household Characteristics: rural(-), agricultural(+), household size(-),

one-generational households(+)

Key Findings:

•The elderly living in one-generational households are more likely to be

economically active than those staying in other living arrangements.

•Implying: the presence of adult children is one of the key factors in the older

persons’ decision to continue or to quit working.

12 34

Conclusions12 34

Conclusions

Policy Implications

• Although working could contribute to the country’s economic development, elderly employment should be also considered in its social aspects.

• Ideally, older persons should continue working as long as they wish and as long as their ability and competency allow them to do.

• The labour-force participation rates of the elderly have been increasing over these two decades.

• The majority of employed older persons are male, aged between 60-69, low-educated, married and self-employed.

• Elderly persons living in one-generational households are more likely to be economically active than those staying in other living arrangements.

• The main reason for remaining in the workforce is financial i.e. poverty and low family support. Another reason is that they are too healthy to retire.

• The key factor of labour-force withdrawal is health problems; they are too old to work.

14

Thank You

15

Thuttai KeeratipongpaiboonDepartment of EconomicsSOAS, University of London

Email: [email protected]

Supporting Documents

16

Living Arrangements of the Elderly

1990 2007

• The majority of elderly people in Bangkok live in two-generational households. Meanwhile, the majority of older persons in the Northeast and Central regions live in three-generational households.

• Trend: more elderly people are found in one-generational households in every region.

• Skipped generational households are mostly found in the Northeast and North regions; an upward trend.

• The average size of household is decreasing in every region. This is because of a delay of marriage and changing value towards having children.

17

Share of the Elderly, by Living Arrangements and Regions of Residence, 1990 & 2007

Source: author’s own calculation from the 1990 and 2007 SES data

Factors affecting Family Relationship

Source: Mason (1992), Figure 118

Key factors to decrease the importance of family: Industrialisation, Urbanisation and Migration

Industrialisation

Urbanisation

Migration

Family Productive Enterprise

Wage Employment of Individuals

Cost of Home-produced Goods

Demand for Female Labour

Universal Primary and Secondary Schooling

Per Capita IncomeFertility

Child Survival

Filial Piety

Parental Power

Female Labour Force Participations

Joint/Stem Family

Ability to Purchase Privacy/Care

Availability of Caregivers

Housing Availability

Separation of the Generations

Care of the Elderly

+

++

-

+

++

+

+-

-

++

+-

+

+

+

-+

-

+

+

+

+

--

-

-

-

Remarks: - Straight and single-headed arrows show casual relationships that run from the cause to the effect; meanwhile, curved and double-headed arrows represent correlated factors,- A sign shown next to the arrow demonstrates a relation between factors. The net impact of factors can be calculated by multiplying the signs. For example, if there is a negative sign between factor A and B, and also a negative sign between factor B and C, the relationship of factors A and C is positive.

Regional Population Ageing in Thailand

RegionShare of the Elderly (%) Old-Age Dependency Ratio (%)

2000 2010 2020 2025 2000 2010 2020 2025

Whole Kingdom 9.43 11.90 17.51 21.22 14.30 17.61 26.58 33.28

Bangkok 7.88 11.28 20.40 26.97 10.61 16.06 30.68 42.50

Central (excl.BKK)

9.84 11.63 16.98 20.80 14.54 16.87 25.18 31.83

North 11.09 13.43 20.16 24.21 17.02 19.65 31.02 39.08

North-East 8.71 11.93 16.95 20.12 13.62 17.99 25.92 31.67

South 9.41 10.76 14.61 17.45 15.06 16.42 22.45 27.28

Source: Author’s own calculation from the Thailand’s Population Projection 2000-2030 provided by NESDB19

Shares of the Elderly and Old-Age Dependency Rations, Thailand, 2000-2025

Age Profiles of Household Savings

Age Profiles of Savings (Whole Kingdom), by ages of household heads, 2007

100

exp x

incomecapitaperhousehold

enditurenconsumptiocapitaperhouseholdincomecapitaperhouseholdratiosavinghousehold

Source: Author’s own calculation from the 2007 SES data provided by NSO20

• Poor if household per capita income is below the poverty line

• The majority of poor elderly people are in the Northeast region.

• Rich households have positive savings; meanwhile, poor households are likely to face the problem of insufficient income.

Old-Age Poverty

21

Regions

Total Elderly People

(%)

Share of Poor Elderly People to Total Elderly People (%)

1990 1994 1998 2004 2007

Whole Kingdom

100.0025.61 20.96 18.14 13.55 12.82

Bangkok 100.00 7.14 2.34 1.79 1.79 1.55Central (excl.BKK)

100.0021.93 10.97 13.25 7.95 5.26

North 100.00 26.85 19.77 15.97 19.77 14.18North-East 100.00 30.61 32.18 27.10 17.65 20.40South 100.00 31.29 18.63 15.36 10.36 9.55

Share of the Poor Elderly 60( +), by Region, Thailand, 1990-2007

Source: Author’s own calculation from the 2007 SES data

Age Profiles of Household Savings, by Income Groups, Thailand, 2007

Source: Author’s own calculation from the 1990-2007 SES data

Source: Author’s own calculation from the 1990-2007 SES data

Share of Poor Elderly People, by Region, Thailand, 1990-2007

100

exp x

incomecapitaperhousehold

enditurenconsumptiocapitaperhouseholdincomecapitaperhouseholdratesavinghousehold

-200

-150

-100

-50

0

50

100

Hou

seho

ld S

avin

g R

ate

(%)

Age of Household Head

1st Decile 2nd Decile 3rd Decile 4th Decile 5th Decile6th Decile 7th Decile 8th Decile 9th Decile 10th Decile

Fertility in Thailand

Remarks: 1 Bangkok was included in the Central region during 1960-1969;2 1970 Census with Own Children Estimate, National Statistic Office;3 1980 Census with Own Children Estimate, National Statistic Office;4 1990 Census with Own Children Estimate, National Statistic Office;5 2000 Census with Indirect Method Estimate, National Statistic Office;6 The United Nations (2009a), World Population Prospects: The 2008 Revision; 7 Survey of Population Change, National Statistical Office.

Source: adapted from Table 1 in Prachuabmoh and Mithranon (2003). 22

Alternative Old-Age Dependency Ratios

23


Source: Author’s calculation, using the data of the International Labour Organization, http://laborsta.ilo.org/, accessed on 1 March 2010. 24

Standard and Alternative Old-age Dependency Ratios, the World, 1980-2020

Estimates Projections


Source: Author’s calculation, using the data of the International Labour Organization, http://laborsta.ilo.org/, accessed on 1 March 2010. 25

Standard and Alternative Old-age Dependency Ratios, Thailand, 1980-2020

Estimates Projections

Natural Increases and Net Migration

Remark: Natural Increase = Births – DeathsSource: Population Division of the Department of Economic and Social Affairs of the United Nations Secretariat,

World Population Prospects: The 2010 Revision, http://esa.un.org/unpd/wpp/index.htm accessed 8 March 2012. 26

Estimates (1950-2010) and Projections (2010-2050), Thailand

Thailand

-400-200

0200400

600800

1,0001,200

1950

-55

1955

-60

1960

-65

1965

-70

1970

-75

1975

-80

1980

-85

1985

-90

1990

-95

1995

-00

2000

-05

2005

-10

2010

-15

2015

-20

2020

-25

2025

-30

2030

-35

2035

-40

2040

-45

2045

-50

('000

) per

sons

Natural Increase Net Migration