By Yasmin Ramlan
SHAH ALAM, March 17 — By 2030, Malaysia will become an ‘aged society’, with 15.3 per cent of its population projected to be 60 years and above.
This demographic shift is placing growing pressure on the nation’s care economy — which includes both elderly care and child care — making it an urgent priority for policy makers and society.
Traditional family caregiving structures are breaking down, driven by urbanisation, shrinking household sizes, and a rising number of women in the workforce, which increases the demand for formal care services.
At the same time, rural-to-urban migration is further straining the availability of caregivers.
“Investing in the care economy is not just a social responsibility — it is a strategic necessity with wide-ranging economic and societal benefits,” said Associate Prof Dr Rahimah Ibrahim, the director of the Malaysian Research Institute on Ageing (MyAgeing).
According to recent data, Malaysia’s average household size has steadily decreased from 5.2 persons in 1980 to 3.8 in 2022.
“This trend reflects broader demographic shifts, including lower fertility rates and changes in family structures,” said Rahimah.
The growing demand for formal care services includes child care, elderly care, and disability care, she told Selangor Journal.
Caring for the caregiver
As Malaysia grapples with these challenges, the government’s initiatives such as the Selangor Care Accelerator (XCare) 2025 programme aim to provide crucial support to the care sector and offer solutions for operators in the industry who are facing challenges.
XCare is a pioneering initiative aimed at expanding the care economy industry. It will feature 30 businesses pitching their ideas, with selected participants receiving mentorship from experienced industry leaders.
The programme also includes workshops covering 13 business-related modules and opportunities to visit local care industry facilities, helping participants grow their business and contribute to the sector’s development.
Rahimah highlighted that a strong economy can boost workforce sustainability and economic resilience, creating jobs that are vital for caregivers as it allows them financial independence.
Of equal importance is the support provided to working caregivers so that absenteeism and stress-related disruptions are reduced.
“Another way of providing support is to focus on skills development, where investing in training for professional caregivers enhances the quality of their work and opens up career pathways,” she said.
Care as an investment
Rahimah, who is also the Malaysia Caregivers Association (Kendana) deputy chairman, stated that investing in the care economy offers both economic and social benefits.
On the economic front, she cited examples of countries like Japan and Germany that have capitalised on their ageing populations to create thriving eldercare industries.
She said these industries have spurred job creation and business growth in health technologies and contributed significantly to the gross domestic product (GDP) of their countries by increasing workforce participation, particularly among women.
Socially, a well-developed care economy improves the quality of life for older individuals, fosters stronger social cohesion, and helps sustain family structures by easing the caregiving burden on families.
Rahimah also highlighted global best practices, such as Japan’s integrated community care system and Singapore’s eldercare masterplan, which offer valuable lessons for Malaysia.
“To build a sustainable care economy, Malaysia needs to establish a National Care Economy Framework, provide financial incentives, and foster public-private partnerships to ensure care services are affordable, accessible, and innovative,” she said.
Additionally, she pointed out that fragmented policies are a major barrier to the growth of Malaysia’s care economy, stressing the need for a cohesive, evidence-based approach.
She said, while the Women, Family, and Community Development Ministry is working on a National Care Industry Framework, greater integration with broader economic and social policies is essential.
She added that state-level initiatives, such as those in Selangor, highlight the need for localised approaches within a national strategy.
Additionally, she also highlighted the challenges care economy operators face in adopting new technologies that could enhance efficiency, reduce costs, and improve service quality.
“Addressing these barriers requires investment in digital infrastructure to modernise care services, training and capacity-building initiatives to encourage technology adoption, financial incentives and subsidies to improve the affordability and sustainability of care services,” she said.
“Investing in Malaysia’s care economy is not an expense — it is a strategic investment in the country’s economic resilience, social well-being, and dignity of older persons.
“The government must adopt a comprehensive, evidence-based, and people-centered approach to ensure this sector’s long-term viability,” she said.
No easy business
Childcare centre operator Rozimah Samad shared that one of the main challenges in running a childcare centre is the difficulty of hiring dedicated staff, especially those with diplomas.
She said these staff tend to be selective about their tasks and are often unwilling to perform cleaning duties.
Located in Taman Dato’ Harun, Petaling Jaya, Rozimah's centre also faces another challenge — parents from low-income (B40) communities expecting premium services despite paying lower fees.
“Parents can be quite demanding. My nursery is located in the B40 area, so the fees can’t be too high. If the cost increases, parents would have to pay RM10 more, similar to a home-based nursery, but they expect premium care that typically costs RM1,000 per month, even though they only pay RM550.
“Despite offering a comfortable, well-equipped space with comprehensive care, including air-conditioning and meals provided in accordance with JKM (the Social Welfare Department) guidelines, some parents are still considering other options,” she said.
Rozimah lamented that most staff only stay for about three years, and those with diplomas often lack practical childcare skills, expecting to teach rather than provide care.
Facing high operational costs of around RM15,000 a month, including for staffs' salaries, rent, and utilities, Rozimah said she would appreciate more government grants and more affordable and flexible training programmes for registered childcare centres like hers.
“This could include online courses on weekends, which would help ease our financial burden,” she said.
Elderly care home operator Datin Paduka Khatijah Sulaiman of Selangor Cheshire Home, which has been in operation for 62 years, highlighted funding and staffing challenges as the main obstacles they face.
Expressing concerns similar to those of Rozimah, she said Cheshire Home struggles to recruit young, trained, and experienced staff to care for elderly disabled residents.
“The increasing demand for higher salaries is also critical, as we do not receive financial support from the government.
“It is a major hurdle, as we rely on fundraising for 90 per cent of the operational costs. Our estimated monthly expenses are around RM100,000,” she said.
Khatijah expressed hope that the government would become a strategic partner, offering support for the sustainability of home and inclusive development programmes while also removing barriers to healthcare facilities and services.
