Prepare for aged nation status by strengthening 'care economy'
THE "care economy" encompasses a wide range of activities involved in caring for individuals and households, including tasks like childcare, eldercare, healthcare and domestic work.
These efforts — often unpaid and carried out by women — are essential to economic and social well-being, yet they are frequently undervalued and excluded from official statistics.
In Malaysia, women shoulder the majority of care responsibilities.
A pre-Covid-19 pandemic study by the Khazanah Research Institute found that women performed 64 per cent more unpaid care work than men and often multitasked between chores and caregiving.
Despite being a long-standing part of Malaysia society, the care economy remains largely informal, with low wages and low policy recognition. This under-recognition is concerning as Malaysia approaches a demographic shift.
The country became an ageing nation in 2021, with seven per cent of its population aged 65 and older. By 2030, that figure is projected to reach 10 per cent. By 2044, Malaysia will become an "aged nation" with more than 15 per cent of its population in this age group.
Increasing life expectancy — 72 for men and 77 for women — will further strain the care infrastructure, mirroring challenges seen in countries like Japan and Australia.
The rise in elderly populations heightens the demand for healthcare, eldercare and welfare services. Without adequate policy reforms and strategic planning, this could result in significant economic strain, particularly on families who are often the primary caregivers.
For instance, the lack of affordable childcare and eldercare services forces many women to exit the workforce prematurely, limiting their economic potential and further widening gender inequality.
To address these challenges, Selangor introduced the Selangor Care Economy Policy in November 2024 — the first of its kind in Malaysia — covering elderly care, childcare, disability support and the empowerment of formal and informal caregivers.
Additionally, the federal government has announced plans under the 2025 Budget to introduce targeted subsidies and tax reforms aimed at reducing fiscal deficits and reallocating resources for essential services, including care economy initiatives.
Such fiscal policies are expected to strengthen the support system for caregivers and improve the affordability of care services.
The care economy also plays a critical role in addressing broader societal inequalities. By providing affordable and accessible care services, more women can participate in the workforce.
This, in turn, contributes to the country's economic growth and reduces the financial pressures on families.
Recognising and formalising the care economy would also ensure better working conditions and fair wages for care workers.
In this context, the Madani policy framework, envisioned by Prime Minister Datuk Seri Anwar Ibrahim, provides a sustainable foundation for solutions.
The six pillars of Madani — sustainability, prosperity, innovation, respect, trust and compassion — offer a holistic approach to tackling issues within the care economy. The compassion pillar, in particular, promotes empathy and proactive solutions for societal needs.
The private sector and non-governmental organisations (NGOs) also play a crucial role in strengthening the care economy.
Social enterprise models can be adopted to encourage private sector involvement in supporting care workers. Additionally, frameworks such as environmental, social and governance can be utilised to evaluate the private sector's contributions to the care economy.
NGOs can serve as vital intermediaries by offering community-based support programmes, advocacy for caregivers' rights and training opportunities.
Collaborative efforts between the government, private sector and NGOs can help bridge the gaps in existing care services, ensuring they are inclusive, accessible and equitable.
The care economy is a vital pillar for societal welfare and the country's economic development. Recognising and strengthening this sector is essential to ensuring Malaysia is prepared to meet the challenges of its aged nation status.
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