Friday, February 27, 2015

Singapore: Budget Announcement Includes Increased Subsidies to, and Payments by, Employers for Older Workers

According the Ministry of Manpower, the Budget Statement delivered by Deputy Prime Minister and Minister for Finance, Mr Tharman Shanmugaratnam, contains two measures related to the hiring of older workers. First, starting January 2016, there will be an increase in the Central Provident Fund (CPF) salary ceiling and an increase in CPF contribution rates for older worker, with an additional 1% Extra Interest on the first $30,000 of CPF balances from the age of 55 also being introduced. See "Factsheet on CPF changes to help Singaporeans save more for retirement."

Second, support will be provided to businesses as they continue to restructure. The Temporary Employment Credit (TEC) will be raised to 1% of wages in 2015, or an additional 0.5 percentage points on top of the original TEC. The TEC will also be extended by 2 years, to help employers adjust to cost increases associated with the increase in CPF salary ceiling and the employer CPF contribution rates for older workers. In addition, employers who re-employ older workers aged 65 and above will receive an additional offset of up to 3% of an employee’s monthly wages through the Special Employment Credit (SEC). The SEC enhancement would help manage employers’ overall costs and encourage employers to voluntarily re-employ older workers aged 65 and above. See "Factsheet on the Extension and Enhancement of the TEC and Enhancement of the SEC."

Source: Ministry of Manpower MOM Announcements in Budget Statement 2015 (February 23, 2015)

In the Press: The Straits Times "Older staff may have to forgo pay rise for more retirement savings" (February 27, 2015); "Tight labour market means firms need older workers despite cost hike" (February 27, 2015)

Thursday, February 26, 2015

AARP Public Policy Institute Issues Report on Skills Training and Education for Older Workers

The AARP Public Policy Institute has issued a report written by Carl Van Horn, Kathy Krepcio and Maria Heidkamp of the John J. Heldrich Center for Workforce Development, Rutgers, the State University of New Jersey, which explores a range of issues relating to skills training and education for older workers, including the challenges older workers face when deciding whether to enroll in education and training programs, and, if so, how to choose a program and pay for it. "Improving Education and Training for Older Workers" make several recommendations based on its findings related to the vast array of education and training options available to older workers, as well as education and training financing options available to them.

Among other things, the report found that:
  • Many older unemployed workers lack the skills that are currently in demand.
  • Many older job seekers are not well informed about the skills they will need to
    obtain a job or the best and most cost-effective way to obtain them.
  • Many federal and state workforce programs are not targeted to the needs of adult and working learners.
The report's recommendations include:
  • Government policy makers should insist on greater transparency from training providers and require them to report on the cost, duration, completion rates, and employment and earnings outcomes.
  • Congress should reform financial aid programs to better assist older workers, including requiring educational institutions to improve financial aid counseling for adult learners from qualified, independent third parties.
  • The tax system could be reformed to provide more financial support for older workers, such as expanding tax credits and deductions for education-related expenses such as transportation, childcare, and elder care.
Source: AARP Public Policy Institute News Release (February 25, 2015)