The Silver Lining of an Ageing Population
By Mary Devereux, Senior Advisor, SEC Newgate Greater China
The theme for this year’s United Nations International Day of Older Persons on 1 October is “Resilience of Older Persons in a Changing World.” Well, we have all needed resilience over the past few years of dramatic change.
For years now, academics and pundits have been touting the fact that the world is ageing. Many believe an ageing population will have an impact on the world and its future like no other event in history. An increasingly senior segment of people will change everything - from cities and transport to healthcare and consumer spending. Ageing is being seen through two lenses – as an impending disaster or as an opportunity to grab with both hands.
According to the World Health Organization (WHO), by 2050, the world’s population aged 60 years and above will double to around 2.1 billion people. As a proportion of the total population, this group will increase from 12% to 22%. In Hong Kong, 19.7% of the population is aged 65 and above. The number of people aged 80 years or older is expected to triple between 2020 and 2050 and reach nearly 426 million.
The pace of population ageing is also much faster than in the past. All countries face major challenges to ensure that their health and social systems are prepared for this demographic shift. However, low and middle-income countries are facing the biggest challenge, as they are expected to host 80% of older people by 2050.
A glass half empty
An ageing population means that there are fewer people of working age in an economy. This could lead to a shortage of qualified workers which may cause a decline in productivity and higher labour costs. One of the biggest concerns is that more seniors will mean a greater burden on healthcare systems, with increased demand for primary health care and long-term care.
The future of retirement will also be interesting to watch. An ageing population means more reliance on government and private annuity schemes, which were simply not designed for this type of growth. For example, in Hong Kong, retirement age is 65 years old, while in mainland China the official retirement age for men is 60. Women in managerial positions have a retirement age of 55, while blue-collar female workers can retire at 50. Is this sustainable?
Some countries have recognised the issue and are beginning to take action. In the UK, retirement age has already moved from 65 to 66 for both men and women and will rise to 67 by 2028. It has not been a popular decision, but it is part of a trend that needs to happen.
However, with better healthcare and more awareness of how to remain healthy, many people are continuing to work past official retirement age. Currently, in the United Kingdom, a million people over 65 years old are working.
The golden years
If people can experience extra years of life in good health and be in a supportive environment, there will be little difference in the things they are able to do compared to that of a younger person. Some of the most important barriers to smart ageing are negative perceptions about older people. But let’s face it, there is no typical older person. Some 80-year-olds have physical and mental capacities similar to many 30-year-olds; just look at President Biden.
Instead of being a burden on society, older people have the opportunity to begin second careers, take on voluntary work or simply continue with their current jobs. In this way, they maintain their contribution to society and the economy. Perhaps how they spend their income will differ to that of a Gen Z adult, but the consumption remains.
A joint effort
The United Nations General Assembly declared 2021–2030 the Decade of Healthy Ageing. The World Health Organization (WHO) has been charged with bringing together governments, civil society, international agencies, professionals, academia, the media and the private sector for 10 years of collaborative action to foster longer and healthier lives.
The WHO has set out to reduce health inequities and improve the lives of older people, their families and communities in four areas: 1) changing how we think, feel and act towards age and ageism; 2) developing communities in ways that foster the abilities of older people; 3) delivering person-centred integrated care and primary health services responsive to older people; and 4) providing older people who need it with access to quality long-term care.
Societies that adapt to this changing demographic and invest in healthy ageing can enable individuals to live both longer and healthier lives – people will live better as well as longer. In return, societies will reap the cultural and economic dividends.