The Aging Global Population And Your Business
The United Nations’ recent reports reveal that more than two-thirds of the world’s population lives in nations with fertility rates below the level of replacement. This coincides with a steady rise in average lifespans across many nations, and the result is an accelerating aging population which, for some countries, has already started to reduce significantly. At the beginning of this century only 32 countries had a median age above 35 years old -- by the end of this decade it will be higher for 53 countries, 25 nations of which will have half their population over 45. It is projected that without serious adaptations to address this change, there could be major economic and social repercussions.
In the face of rapid technological and geopolitical changes, one key demographic trend is certain — our aging population. Business leaders must take stock of this looming shift and its implications on labor pools, markets, and the nature of work. As our global population continues to age, businesses will need to consider how they target senior consumers and adjust their strategies accordingly. Companies must also find creative solutions to help seniors stay in or re-enter the workforce even past traditional retirement age. Finally, relying too heavily on youthful demographic segments could prove a mistake in light of our aging population — smart business leaders know that innovation requires a diversification of thought and perspective beyond the young adult demographic.
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The Aging Customer Base
The growth of the global 70+ population over the past decade is astonishing; it has nearly tripled in size. What's even more impressive is that experts predict that population to reach up to 16% of total global population in just 10 years. This shift brings great promise for many businesses in terms of developing products and services to better accommodate the needs of this market segment. The older demographic is look into what for an opportunity to stay active and participate in their favorite activities and hobbies, including travel, media consumption, and education. The scope of their interests is far-reaching and offers a diverse set of offerings for those who choose to get involved in developing the solutions.
Health care is the most obvious sector for growth, as demand for geriatric medicines, primary and specialist care, and high-tech products like wearable glucometers or electrocardiograms is expected to grow for a long time. While life expectancy has risen substantially, healthy life expectancy does not always keep pace - making it increasingly important to find ways of supporting the health needs and welfare of this growing group. This presents a particularly pressing challenge in parts of the world such as rural areas in the US where access to health care remains a problem. Here governments and policy makers must work together with those improve existing health services and ensure that elderly people’s well-being is taken into account.
As our population continues to aging, it presents an opportunity for those in real estate to tap into a growing customer base. With more seniors looking to downsize and adult children investing in homes that accommodate for elderly parents, gaining expertise in the nuances of these types of real estate transactions can be beneficial. Realtors may consider obtaining professional development certifications or training specially catered towards this demographic shift in order to differentiate themselves, enhance their abilities, expand their potential marketing base, and create opportunities for growth. Ultimately, understanding the age shift can help realtors understand how to better serve their clients and drive success in the industry.
The Aging Workforce
As fertility rates fall around the world, companies are increasingly struggling to find new talent and asking their older employees to stay on longer. This presents a unique set of challenges that organisations must adapt to in order to remain competitive and maintain a productive workforce. Organisations will have to invest more into training programs targeted at older workers that can help them acquire the skills for remaining tasks, as well as health and safety measures such as exoskeletons. Additionally, many organisations are turning towards automation as an alternative solution when talent becomes scarce. However, both investments are significant, and decision makers must weigh these methods carefully before implementing them within their organisations.
The advent of digital workforce technology is bringing profound changes to the modern workforce and revolutionising existing models. Companies are developing virtual sales associates, customer service representatives, as well as companions for elderly people. The development of these tools is based on advances in Artificial Intelligence combined with changing demographic trends. This radical shift has the potential to transform many industries and become an essential part of our thriving economy. It holds countless opportunities but also many challenges when it comes to protecting workers' rights, employment standards and contractual compliance. As we keep adapting to this new landscape, businesses must have a thorough understanding of the implications associated with digital workforce technologies in order to make properly informed decisions about their implementation and use.
Changing Retirement Norms
As evidenced by the stark comparison between Japan and France, age alone doesn't necessarily determine when a nation's citizens enter retirement. Instead, a combination of factors such as work culture, social contracts between governments and citizens, rules and policies can influence the average retirement age in any given country. This is particularly apparent when comparing Japan to France; despite 31% of its population being 65 or older, more of their workforce continues to be active due to a higher average retirement age of 71 years old. Conversely, a much smaller proportion of the French population - 22% - is over 65 and yet 29% of their workforce has retired due to a elder retirement threshold of 61 years old. Such disparities demonstrate just how varied each nations’ approaches to retirement can be.
As our societies continue to age, the issue of retirement ages has become an increasingly pressing one. Perhaps explaining why both the Netherlands and Ireland recently scrapped plans to increase retirement ages in order to accommodate lengthened life expectancies. Such a move was likely motivated by a desire to appease citizens — as most are generally opposed to any pension-denying legislation. However, instead of rejecting any discussion of reform in this area completely, it is critical for governments and employers to find ways of encouraging people to delay retirement if they wish. This could often be beneficial on a number of different fronts; allowing employers to take advantage of skilled veteran workers and thus ensuring that their companies remain competitive, while simultaneously allowing these individuals greater financial freedom and security during later years in their lives.
For instance, many older workers who are not yet ready to retire have begun demonstrating increasing interest in semi-retirement. Baby Boomers constitute a substantial portion of the workforce, so it is no surprise that many are seeking semi-retirement options such as flexible work or reduced hours. However, the fact that only one in five employers offer these opportunities suggests a disconnect between employer and employee preferences. To understand the labor market and remain competitive, employers must consider more than simply age demographics; they need to evaluate local rules and regulations about retirement as well as cultural norms in order to realise what true retirement ages could be. Additionally, providing unique career paths that incorporate semi-retirement options can help employers to attract and retain talent.
When it comes to retirement norms, age is just a number, of course, the expectations around how long workers expect to stay on the job don’t necessarily correspond with lifespans.
Changing Global Markets
As the global population continues to age, we must remember that our perspectives on demographic trends are constantly shifting. A decade ago, Japan, Italy, and Germany were considered some of the world's oldest populations. Today, however, Thailand and Cuba share the same distinction for having aged citizenry, with Iran, Kuwait, Vietnam, and Chile not far behind. In 10 years time these countries will be faced with a period of smaller cohorts of younger people who will be entering the workforce and consumer market. This influx is sure to boost each nation’s average age as they progress into modernity. Although this may cause some initial hurdles due to a possible lack of experience and resources within the younger generations in these countries, it points towards a brighter future where economic growth is not limited by an ageing population.
Identifying new markets for investment requires comprehensive consideration. Business leaders must be mindful of both the demographic trends and governmental reactions in order to accurately assess a nation's potential as an investment opportunity. With an aging population, governments must determine how to address the financial responsibility for care - whether that is taken on through public funding or left to companies or individuals. This approach will have considerable ramifications for a country's talent pool and customer base, making it important for business leaders to take note of before deciding whether and where to invest.
The Future Is Clear
Business leaders and policymakers must face the reality of our changing demographics: an aging population worldwide. When a population’s fertility rate drops below replacement level (2 children per woman), it stays there, creating a global decline in population growth. To counter this decline, there could be mass immigration from countries with young and growing populations such as Ethiopia and Nigeria. However, the situation remains largely unpredictable due to other factors that can affect population change. Despite these uncertainties, our demographic future appears clear: an aging population with several ongoing implications for business and policy around the globe.
Population aging is a complex, far-reaching phenomenon that is becoming more and more present in our societies. Despite the proliferation of fear and determinist rhetoric, it is possible to prepare for the future by having clarity around the trends associated with aging population. This understanding equips individuals with the foresight and planning necessary to adjust our businesses and governments accordingly. Such an approach requires an informed perspective on which factors are beyond our control, as well as an understanding of those which can be influenced through proactive investment. Thinking about population aging in this way unlocks opportunities for leaders in all sectors to mitigate risks, identify and seize new opportunities, and embrace the changing environment.
Is your business ready for the aging global population? Comment down below. Alternatively, reach out to Harissa Business Partners and we can discuss how we can support your business with aging population concerns. We are here to help you contact us now at info@harissabp.com.au.
