Report tells why ageing populations are an asset

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Governments are being urged to invest in preventative healthcare to maximise the potential of older people.

The International Longevity Centre (ILC), whose mission is to “help societies address longevity and population ageing in positive and productive ways”, has released a report, Health equals Wealth, that calls for an “ageing society new deal” to ensure governments better support older people to work, spend, care and volunteer.

“We’ve become accustomed to our ageing population being presented as a bad thing,” write report authors Sophia Dimitriadis and Patrick Swain. “Policy makers are so fixated on the direct costs of ageing that they fail to notice the significant and growing contributions that older people make.

“This prevents them from fully realising the social and economic potential of older people – and from appreciating the potential longevity dividend.”

Ms Dimitriadis and Mr Swain point out that workers aged 50 and over earn every third dollar in the G20 economy. By 2035, older workers are projected to generate nearly 40 per cent of all G20 earnings.

They say that nations must prioritise older people’s contributions because:

  • in countries that spend more in health, older people work, volunteer, and spend more
  • people who report being in good rather than poor health are more than four times more likely to be in work between the ages of 50 and 65, and more than 10 times more likely between 65 and 74
  • increasing preventative health spend by just 0.1 per cent can unlock a 9 per cent increase in annual spending by people aged 60 plus and an additional 10 hours of volunteering.

Their analysis of 27 European countries proves older people are working longer, becoming a bigger part of the consumer market and their unpaid contributions are strengthening communities and underpinning the formal economy.

And it confirmed that older people in good health (those who have better cognition, are less limited in daily activities and/or who report being in good health) work, volunteer and spend more.

“To achieve better health, we must prioritise preventative health interventions, as these are the most cost-effective. Prevention not only reduces treatment costs but supports the wider economy. As our economies become increasingly reliant on such economic contributions, the case for investment becomes urgent.”

Such insights are not new. In 2016, Australia’s age discrimination commissioner, the late Susan Ryan, said: “The economic potential of older Australians is huge.

“If and when we tackle the discrimination that forces people out of work years before they want to leave, the potential will be even greater.

“Individuals who are able to keep working, (and there are increasing numbers of them) at least to Age Pension age or a few years beyond, not only make important additional contributions to the national economy, they increase their own capacity to consume products of all kinds and purchase a diversity of services. Thus, they directly contribute to employment growth across all sectors.

“Already Australians over 55 own more than half the nation’s assets. This fact is usually ignored in the plethora of fear mongering about the alleged burdens of our ageing population.”

Ms Ryan said a modest increase in workforce participation by over-55s would bring billions to the national economy and reduce public expenditure on age pensions and health.

She quoted a report commissioned by the Australian Human Rights Commission that estimated a $32 billion impact on the economy with an increase of just 3 per cent of over-55s.

“And, let’s not forget that there are other significant benefits to employing older workers: benefits to business; benefits to productivity; benefits of a healthier workforce; and benefits to business of recruiting to reflect the changing age profile of the consumer base.”

Ms Ryan estimated a lift to gross domestic product of $40 billion over a decade if labour force participation by people with disabilities rose by 10 percentage points.

The ILC’s figures are equally impressive: “If we tackle the avoidable barriers preventing older people from contributing … (nations) could see an average GDP gain of around 7 per cent – or an aggregate GDP boost of US$3.7 trillion.”

Key suggestions of the ILC’s Ageing Society New Deal:

  • invest in health and recognise its economic value
  • spend at least 6 per cent of health budgets on prevention
  • ensure that spending on preventative health keeps pace with the growth in preventable ill-health
  • tailor health interventions to meet the needs of disadvantaged groups and prioritise health spending on disadvantaged populations of all ages
  • incentivise technology innovation that supports productivity, rather than displacing workers
  • remove regulatory barriers (such as mandatory retirement ages) and incentivise and support people to work for longer in flexible roles
  • invest in opportunities for lifelong learning
  • ensure formal care provision develops to meet increasing need
  • develop strategies to support businesses to capture an ageing consumer market, including support for innovators across sectors and existing businesses that wish to adapt
  • allocate funding to local governments to support inclusion within communities, for example, through action to make transport and public spaces accessible and inclusive
  • regularly measure unpaid contributions and calculate their social and economic benefits
  • consider the impact of health on unpaid contributions when making decisions about investing in health (such as cost-benefit analysis models)
  • develop strategies to support older carers and grandparents
  • develop strategies to support and incentivise volunteering, including removing barriers to participation particularly for disadvantaged groups.

The ILC contends that the COVID-19 pandemic has created an “exceptional opportunity” to support older people.

“Amidst the devastation it has caused, it has shown us how our economies are linked to health and exposed the dangers of under-investing in prevention. Let’s use this shift in mind-set to commit the funds today that we’ll need to realise a longevity dividend tomorrow.”

Does our government invest enough in older people? Do you feel older people are underused?

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Written by Will Brodie

7 Comments

Total Comments: 7
  1. 0
    0

    Yeah right! Does anyone really think that ANY government in Australia is going to believe that older people can ACTUALLY add to the economy.
    These are political parties who have for YEARS placed the blame on older people for ANYTHING they can think off. They have convinced young Australians that we are stealing, jobs, homes, money and you NOW expect them to admit that they were wrong!!!!!
    Yeah, good luck with that!

  2. 0
    0

    The reason this is happening is because the ‘ME’ generation are beginning to realise that they are going to get old one day and they still want everything everyone else has without having to go without to get it.

  3. 0
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    The whole community and governments totally undervalue the combined knowledge, experience wisdom and patience that older people could bring to solving many of the country’s problems. In our culture as soon as anyone is ‘old’ their views and experience are devalued at immense loss of opportunity to the community. Just take education at its various levels. We have thousands of children leaving school each year unable to get into the workforce just because they can’t read, write and do basic mathematics. Teachers are unable to give individual attention but surely bringing in retired workers who after some basic training could provide coaching to small groups would be a great investment. Similarly trade and other skills some of which we losing, where TAFEs are unavailable or inadequate, retired workers could fill a gap. Retired business people could mentor young inventors and entrepreneurs to help improve their business success. Even some young mothers and fathers seem to lack basic domestic and survival skills today. We have $billions worth of accumulated skills, knowledge and experience which is being wasted much of it would be available at little or no cost. Why are we bringing in people from overseas to fill jobs that we can’t do yet we have a mass of young unemployable people just because they lack the skills we have decided to ignore and discard? Surely we are smart enough to do better than this?

  4. 0
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    An asset? To whom: the people who do matter?
    Yikes.
    The underlying assumption says it all.

  5. 0
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    Well, we could change the system for a start. My sister and her husband are 70 and are still working because they like the rewards they get, like they are on the full pension, sister from age 64 and the brother-in-law from age 65. No means testing, asset testing BUT all the taxes payable and they still find it worthwhile to continue working. Reckon some oldies here would continue work without this asset and income problem. Who wants to work when losing the pension, really? Workaholics possibly.

    • 0
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      Mariner, you have hit on a key weakness of the Australian economy. You say “Who wants to work when losing the pension, really?” Doesn’t this apply to so many people throughout their working life? If you work too hard and pay too much tax, rather than reap the rewards of your efforts, sweat and toil you get penalised with no pension and the mass of benefits that go with that. If we continue to penalise hard work and success and reward as you say those who don’t wants to work and lose the pension, then the country will eventually fail. Increasingly when young people in health related services ask me for a concession card and I reply “sorry I’ve worked too hard for one of those,” they say ‘yes I’ve learnt that lesson already, what’s the point in studying and working hard?’


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