PETALING JAYA: Malaysia may face a difficult situation of a shrinking labour force as it transits to an ageing society, according to the Statistics Department.

       This is also made worse with the decline in the national fertility rate which may also lead to lower growth in productivity, slowdown in economic growth and decline in tax revenues for the government.

       The government has made efforts to encourage women to give birth to more children as well as to assist them to re-enter the workforce to address the situation of low fertility rate.

       According to the Statistics Department, the total fertility rate last year declined to 1.6 children for every woman aged 15 to 49 years compared with 1.7 in 2021. This fertility rate was the lowest in five decades, with 4.9 children per woman that was recorded in 1970.

       In a related matter, RHB Research said Malaysians might have to work longer to ensure financial adequacy in their retirement age.

       This was also in line with other countries in a similar development curve that had raised the retirement age to beyond 60 years old.

       “To keep the elderly relevant in the future workforce (preferably with less physically demanding occupations), policies that enhance opportunities for training and lifelong learning are needed to foster their employability,” RHB Research said.

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       It also pointed out of United Nations’ study statistics showing the proportion of consumers aged 65 years and above in the region is expected to outpace that of the other age groups, at 65.6% in 2020 to 2030.

       “The shift in consumer class would also mean a redistribution of consumer spending behaviour, as consumers in the senior age group may likely have greater purchasing power,” the research house said.

       “We believe this could present potential investment opportunities, as businesses and healthcare service providers can gradually cater their products and services towards the growing aged populace,” it added.RHB Research recommended “buy” on KPJ Healthcare Bhd, with a target price of RM1.46, citing its optimism on the group’s senior living and assisted living care centres (SALCCs) exposure.

       “We are upbeat about KPJ’s SALCCs’ strategic presence in Malaysia, as the company has a mid-to-long term focus on introducing robotic and artificial intelligence-driven technology to enhance treatment for senior residents.

       “On top of that, KPJ is also working to strengthen its referral programme with public hospitals to drive organic growth,” the research house added.