Our Older World
The aging of the world is an unprecedented transformation that results from thousands of years of striving for better, healthier, and longer lives. We are in the first minute of a giant change. If we navigate well, we can make the most of the greatest treasures humankind has ever sought: longer, more robust lives and the wherewithal to make the most of them.
In the long term, the prospects of extended life and more mature communities may promote the prosperity of G-8 countries by leveraging their ability to create the world’s best educated workers. G-8 nations can have workforces that contribute to productive and creative enterprises (and governments) longer and with better skills than ever, all while their citizens enjoy a good work-life balance that in itself promotes longer life, health, and creativity. We can, and must, get it right. Global aging is a huge, complex change that touches all of us from womb to tomb, in every corner of the globe.
This brief covers some of the challenges. It also offers a short reflection on opportunities facing our aging world that are driven by the G-8, but which extend beyond and help drive a growing segment of the world’s population to better health, longer lives, and prosperity.
An Accelerated Change
The world’s population is growing older. The number of older people is growing faster than the number of young people. The rate of aging varies from place to place, and a handful of limited geographic regions are bucking the trend. However, global aging is not a slow trend unfolding at a glacial pace. Compared with most of the big demographic shifts in human history, global aging is a flash flood that is fundamentally changing the way the world lives and does business.
Global aging propels, and is propelled by, the speed of modernity, in which the globalization of capital, labor, technology, information, and the emancipation of women quicken demographic change. Yet in a multifold dynamic, the resulting changes in the ways we live, in turn, accelerate the ways we remake our communities, firms, and economies.
Global Aging: Personal and Communal
Overall, and overwhelmingly, people are living longer than at any time in history. Heartier diets, the conquests of infectious disease, the spread of effective public health, and literacy have been good medicine for the world. In the United States, Western Europe, and Japan, life spans have been stretching about two years longer in every decade for more than a century. Spanish women today live on average to about 84 years old.1 A child born today in France has a one-in-two chance of living to 100.2
Median Age and Elder Share Is Up
Having citizens who live longer lives is not enough to push up the average age of a group. To determine whether populations are aging overall, demographers look at two related data sets: median ages and elder shares.The world today is evenly divided between those under the age of 28 and those over it.3 By midcentury, the median age will have risen to nearly 40.4 In Europe and in much of industrialized East Asia, median ages will likely exceed 50.5 If the elder share, or proportion, of people over 60 (or sometimes over 65) is growing, the population is aging. By that yardstick, the world is quickly becoming older. Pick any age cohort above the median age of 28, and you’ll find its share of the global population rising faster than that of any segment below the median.
Unsurprisingly, these changes rebalance the world’s economy and influence the global flow of money, labor, and goods. In the world’s oldest countries, for instance, the supply of active labor is rapidly shrinking and, relatedly, the collective needs of people who have retired out of the workforce are growing. In countries undergoing the early stages of growing older, working- age populations are abundant today but are aging quickly and tilting the generational balance of their populations more and more toward older groups.
Demographic aging is widely expected to retard economic growth, consumption, and savings rates.
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Longer Work Lives for Individuals: Some Made More Valuable by Population Aging, Some Made Less
Global aging exerts pressure on individuals at work. Some large categories of workers struggle to hold jobs that migrate to younger locales. Managers and owners must weigh how to keep older, experienced workers at their posts. Older workforces can stay highly productive where workplaces and technology adapt to older workers’ abilities and needs. For example, to keep its aging workforce highly productive, BMW shifted the position of cars on its assembly lines from horizontal to vertical. By standing the cars upright, the company aimed to help older workers who had difficulty operating under the cars when the cars were flat on the assembly line. The move not only helped older workers but made the assemblies as a whole more productive.
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Smaller Families and Fewer Familial Supports
The advent of longer lives coincides with a dramatic downsizing of the immediate family. No big industrialized country has a birthrate much exceeding two children— some hover around one. In the United States, the fertility rate is at the historically low level of 1.9, but in some Eastern European countries and in Japan, fertility rates drift around 1.4, the lowest point since records began.22 (These countries must brace themselves for large drops in their populations.) In Sweden and France, home to Europe’s biggest new families, birthrates are near replacement rate but unlikely to go much higher soon.
The single child and childless adult are commonplace, but the households they make will be far different from today’s already smaller families. Within a generation, it will be routine for a child to be born with no brothers or sisters, no cousins, and no uncles and aunts. Thus, global aging challenges families. When older people have fewer younger relatives to care for them and provide emotional and financial support, the physical and financial burdens for care fall to the few who remain. Also, much of the care once provided within a family will move to the public or commercial spheres. Expenses such as these can overwhelm families and governments.
Countries, Cities, and Other Localities Must Fight to Stay Demographically Young
Global aging challenges communities to develop the mix of social amenities and work opportunities needed to retain and engage young, talented workers so that they are available in the local labor pool. Strong, youthful demographics, in turn, help keep and attract businesses to the area. Many aging places, however, are overwhelmed by how swiftly their labor forces age.
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An Older Population Is a More Diverse Population: Uniform Treatment of Older People Is Counterproductive
Any approach to navigating an older world must take into account the fact that the population grows more diverse as it ages. Up until age 60, people in a given age cohort tend to be mostly as healthy and cognitively fit as their cohorts.23 Twenty year olds are mostly as healthy and as sound of mind as other 20 year olds; likewise, for 50 year olds. Above age 60, the health and cognitive status of the population is far less uniform. About 70% of the population can, for example, work at near full capacity, but for others, physical setbacks have already begun to slowly limit their abilities.24
The older population—if defined as 60-plus or 65-plus—is a huge group that includes the relatively able group in their sixties and the far less able group over 85 (at which time a person has a 50-50 chance of being stricken with some form of dementia).25 Cookie-cutter solutions or regulatory demands that are insensitive to age-related diversity in the workplace will not suit an aging population, its employers, or its older citizens. Yet opportunity abounds.
The Boon of an Aging World
Global aging also drives, and is driven by, trends that move hundreds of millions of the world’s poorest people into the ranks of the literate, the middle class, and the longer lived. When jobs move from high- income economies characterized by aging workforces and their attendant expenses (high-cost labor, higher taxes to pay for welfare expenses, etc.), that work primarily lands in younger, lower-income places.
The aging of the world is inseparable from its prosperity and the rise everywhere of an ever-growing global middle class.
To read the entire 10 page report, click on the world/hands graphic at the top of the page.