The Economic Significance of Work Experience for Elderly Employment in Thailand

Abstract

A rapid demographic change to the aging and aged population in Thailand has led to a reduction in the labor force, and an increasing concern about the economic potential of the country. Therefore, a study of older adults who are capable of working, and an analysis of the significance of their work experience is vital for public policy. An analysis of the data from the 2018 Labor Force Survey in Thailand demonstrates that older adults in the age groups of 60-64 and 65-69 who are capable of working constitute 24.2% and 21.2% of the population, respectively. Among these older adults are retirees, who have the highest potential because they are well educated and highly experienced. Multinomial logistic regression was applied to correct the selectivity bias in the analysis of the return on work experience. The results indicate that the marginal return on work experience is 2.75% for high-skilled occupations. There are similar results for semi-skilled and low-skilled occupations (1.99% and 1.73%), however, diminishes more rapidly in the latter than in the former. These findings indicate that the value of experience increases with occupations that require skills, and diminishes significantly in jobs that mainly require physical strength (i.e., low-skilled occupations). This study suggests that older adults with the potential to do so should be encouraged to remain active in the labor market, and that labor demand is enhanced by emphasizing the value of their experience.