Populations are ageing in most countries in the world.^[1] Population ageing describes an increase in the size of a country’s population over a certain age. Generally, the cut-off for analyzing growth in the ‘old age’ group is 65 years. That is, people considered to be of ‘old age’ are aged 65 and over. For years now, increases in the proportion of populations aged 65 and over have occurred in most countries. Population ageing occurs as a result of multiple factors:

• Increase in average life expectancy: Average life expectancy is generally calculated as ‘life expectancy at birth’. Life expectancy can be increased by decreasing child mortality; improvements in overall population health; the elimination of diseases that contribute to premature deaths; and increased access to healthcare and other factors. In many countries, life expectancy has increased with economic development.^[2] In developed regions, life expectancies are increasing by about 2 months per year. This adds about 5 years to the average person’s lifespan per generation (all other factors being equal).^[1] By 2040, average life expectancy will be above 80 in 59 countries^[3]; in 2050, the global average life expectancy will be 76.^[4]
• Low fertility rates: If people do not have enough children to ‘replace’ the population, older age groups can start to outnumber younger age groups.
• Reduced migration: Migration generally brings young, working-age people into a population. If migration is reduced, the proportion of the population in those age groups may grow less.

Although every country will experience an increase in its average age over the next few decades, the balance of forces driving this trend will differ from country to country. While population ageing started in high-income countries (for example in Japan 30% of the population is already over 60 years old), it is now low- and middle-income countries that are experiencing the greatest change. By 2050, two-thirds of the world’s population over 60 years will live in low- and middle-income countries.^[5] In developing countries, populations can ‘age before they grow rich’^[1,6], leading to challenging strains on public resources.

The number of people reaching working age during the coming decades will be significantly lower than in the preceding decades.^[7] The size of the working age population relative to the population of retirees is called the ‘dependency ratio’. It is likely that by 2050, the dependency ratio will be below 2:1 in 35 countries around the world. Conversely, the dependency ratio is expected to improve in many African countries and parts of Asia.

Migration can be an important contributor to increasing the dependency ratio in an otherwise ageing population.^[7] In many countries, migration is already an important factor in maintaining a working population that can meet the needs of the ageing population.^[8] Immigration policies, particularly in developed countries, will need to balance a growing demand for workers with internal political tensions in the future.^[9]

While some older people will require care and support, older populations in general are very diverse and make multiple contributions to families, communities, and society more broadly. Yet the extent of these opportunities and contributions depends heavily on one factor: health. Supportive physical and social environments enable people to do what is important to them, despite losses in capacity.

At a societal level, this trend has implications for:

• Workforce: As people stay in the workforce for longer, companies may need to reimagine workload design, talent management and approaches to training and skilling workers.^[2] Some countries are already increasing retirement ages.^[10] We can expect that workers may approach their careers differently, with more ‘portfolio careers’ and life-long learning.^[3]
• Healthcare: Older people may require more and different types of healthcare as they live longer within the period of life associated with declining health.^[2] A goal for many countries in the future will be ‘morbidity compression’ – the reduction of ill health to the last few years of life.^[8]
• Consumer trends: Older adults, especially those with longer periods of retirement after exiting the workforce, may have specific ‘Consumption’ patterns. These may include mobility, safety, and medical products, but also increased tourism, leisure, and spending.^[1] Opportunities are expected in the ‘wellbeing economy’ and ‘The experience economy’ as the lifestyles and tastes of older consumers change.^[3] While reduced spending in retirement can contribute to slowed economic growth^[10], the global spending power of people over 60 is expected to have reached USD 15 trillion by 2020 and will continue to grow.^[3]
• Physical and social environments: Age friendly communities that offer safe and accessible public buildings and transport, places that are easy to walk around and opportunities for social interaction help older people to maintain their quality of life and contribute to their families and communities.

Young generation influences

While ageing populations will be an area of focus for many countries, the influences of younger generations will also create challenges and opportunities. Younger population groups will have an influence on workforces, the economy and demand for products and services. Young populations are of particular importance in sub-Saharan Africa, where half of the citizens will still be under 21 years of age by 2035.^[2]

Young people from all economic and cultural backgrounds are increasingly interacting in online spaces. They are both influencing and being influenced by a global spectrum of ideas, trends, opinions, and advertising.^[8] These younger generations will pose challenges to governments, in their increasing political engagement, and to businesses, as their over-exposure to advertising leads to more sophisticated purchasing decisions. Many people see younger generations as having strong opinions around climate change, political issues, and social injustices.^[1]

The influence of educated and tech-savvy young people in the world of work will require responsive talent management and creative thinking about staff development and career opportunities.^[8] The employment opportunities of today’s youth have been affected by successive financial crises. Some suggest that traditional education systems have insufficiently prepared young people for increasingly technology-focused and/or knowledge-based work.^[1] Young people may be negatively affected by changes in the employment market due to increasing use of technology and changes in consumer habits, leading to challenges in building economic capital.^[1]

References

1. Future outlook. 100 Global trends for 2050 (UAE Ministry of Cabinet Affairs and the Future, 2017)
2. Asia pacific megatrends 2040 (Commonwealth Scientific and Industrial Research Organisation, 2019)
3. Future possibilities report 2020 (UAE Government, 2020)
4. Global Trends and the future of Latin America. Why and how Latin America should think about the future (Inter-American Development Bank, Inter-American Dialogue, 2016)
5. Ageing and health (World health Organization, 2021)
6. Latin America and the Caribbean 2030. Future scenarios (Inter-American Development Bank, 2016)
7. Global trends. Paradox of progress (US National Intelligence Council, 2017)
8. Global trends to 2030. Challenges and choices for Europe (European Strategy and Policy Analysis System, 2019)
9. Global risks 2035 update. Decline or new renaissance? (Atlantic Council, 2019)
10. Global strategic trends. The future starts today (UK Ministry of Defence, 2018)