Is the World Ready to Deal with the Aging Population?
As every minute passes by, the world grows older. With a rise and fall of population growth, an aging population is a serious phenomena.
A recent report by the UN showed that the old age dependency ratio – individuals between the ages of 65 – 100 vs 15 – 64 – has been on a steady rise over the past few years.
14 years ago, the ratio stood at 11.3; it was 11.7 in 2010; is predicted to hit 14.4 in 2020 and 18 by 2030.
Data from the WHO attributes this increase in the senior population to a change in the main cause of death; from infections to chronic non communicable health issues like diabetes, cancer, and heart disease – the latter two are now the leading causes of death for those of old age.
Before you dismiss this, let me make it clear that this is a ticking time bomb. The population growth of senior citizens is an issue that will affect every country across the world.
As the aging population increases, healthcare, workforce systems and policies across the world will have to change drastically to accommodate this shift and scarily, it is not yet clear if the world is ready to make that change.
What does this mean you might ask and thank all that is good that you are asking. Let’s take a look at what is fueling our population and why we should be cautious.
Our Current Healthcare Systems Are Overburdened
Data from the WHO shows that the number of people over sixty five will grow to 1.5 billion in 2050. Most of the growth in senior citizens is happening in developing nations that do not have a strong and well established healthcare system.
It is hardly a secret that after a certain age, an individual will require around the clock medical care as infections and other chronic issues become a part of their day. This will force the governments to spend more on the healthcare system, not to mention pension schemes – more on this below.
Another point worth noting is that citizens who are in retirement will pay less in taxes because they are not working (most countries have lenient tax rules for the senior population). This combination of high cost commitments and lower tax returns will be a major concern for any government – especially governments that are already burdened with debt and unfunded pension schemes.
Non Feasibility of Pension Funds with a growing population
Picture a world where an economical crisis is sparked off because the government has to ensure that the senior citizens are financially secure.
Seems like an unthinkable situation, right? Well, not really.
The majority of people between the ages of fifteen and sixty four do not work or save up towards a pension plan. Pair this up with the fact that many are increasingly opting for early retirement and you can see why it will be hard for any government to accommodate the rise in the cost of pension plans. The option of cutting pension plans is not a feasible issue either because it will lead to the issue of poverty among the elder population.
Moreover, higher expenditure on pension schemes will reduce capital investment. Putting more money into pension plans will reduce the cash available for other investments that can bring in money, which will then result in a lower economic growth rate.
For instance, let us say that the government diverts public money from education and infrastructure towards pensions. The end result will be a lower quality of life and economic growth.
The Retirement Age Keeps Falling
While the average life expectancy has been rapidly rising, governments have been reducing the age of retirement in tandem. In America, on average, the life expectancy is 78 years but the average retirement age stands at 66. The fact is that the majority of the world’s population will eventually face a period where their only option is to live off of the accumulated wealth – if any.
Do We Have Enough Old Age Homes?
In all generations, it is common for some of the younger ones to pursue their dreams and lack the interest to look after their parents. The results of this are never kind to the parents. Either they suffer harsh treatment from their children or they are reduced to mere shells of their former selves, spending the days just living in an ill-equipped elder’s home.
Furthermore, we cannot brush aside the ugly moments that these older generations have to go through as they age. Physical and emotional abuse, neglect and violence at a point where their bodies are frail and old is something that cannot be ignored.
The growing ageing population is not just a serious issue for the governments around the world, it is an issue that will affect everyone, directly or indirectly.
How do we solve this expectation of an Aging Population?
Some of the solutions by experts include phased retirement that allows a full time employee to work on a part time schedule while they begin reaping the benefits of retirement. Senior employees who do not want to retire simply because they like what they are doing should be offered other options too.
In addition to that, it would serve governments well to promote and reward volunteering, artistic work and more among elders. This type of unpaid work can keep old people in good health, reduce loneliness, improve their quality of life and social fabric, contribute to the economy and reduce the cost of welfare and pensions.
The ageing population can help society in many ways. For example, they can provide wisdom and guidance to many. 77 percent of HR professionals believe the older guys are more knowledgeable than their younger counterparts while 70% (of HR professionals) believe the senior population has a stronger work ethic.
The seniors can reduce the cost of healthcare by moving from hospitals to a nursing home, hence moving the cost from healthcare to social care funds. It does without saying that they will also commit less crime.
The older generation does have the chance to make positive contributions but the government’s programs and policies, as well as the organizations that manage aging workforces, need to get their act straight and prepare themselves for the inevitable… quickly.