It’s an undeniable fact. The world population is getting older, and it is aging at an unprecedented rate, never seen before in human history. Global aging is presenting societies throughout the world with serious challenges. It is causing dramatic changes in the population’s needs, and it has significant implications for employment, savings, consumption, economic growth, asset values, and fiscal balance.
Learn about the global aging population, highlighting the reasons it’s happening and the challenges it presents. See the solutions that societies are implementing in response to this issue.
What is an aging population?
Global aging means the number of older adults is increasing as a percentage of the global population. For example, in 1990, it was estimated that the elderly comprised 6% of the worldwide population. But in 2019, the elderly comprised 9% of the global population.
It is estimated that in 17 countries, the elderly comprise more than one-fifth of the total population. Statistics show that in the early 1900s, the chances of reaching 65 were less than 50%. Now, statistics show the chances of reaching the age of 65 are more than 90%.
In the 1960s, on average, the proportion of adult life spent beyond age 65 was less than one-fifth. On average, the current proportion of adult life spent beyond age 65 is more than one quarter. In 2019, 703 million people were 65 years or over, and by 2050, the amount of older persons is projected to reach 1.5 billion.
Driving Factors Behind Population Aging
Analysts have cited two reasons for the aging population. These are (1) a decline in fertility rates and (2) an increase in longevity created by advancements in medical science and overall improvements in health care. The lower fertility rate is occurring because of the changing role of women in society and greater access to contraception. The extended longevity is happening because of advances in medical science and improvements in health care.
Problems with an Aging Population
The effects of population aging are best viewed in economic terms. The aging population slows economic growth, increases the need for formal and informal social support systems, and decreases a country’s ability to provide for its older citizens.
Analysts have noted how the aging population affects the world:
- Decrease in Workforce Size — One result of an aging population is a decrease in workforce size. This means there are not enough qualified workers, making it difficult for businesses to fill specialized positions. This inability to fill specialized positions leads to a decline in productivity, an increase in labor costs, and a reduction in business growth.
- Increase in Health Care Costs — As the percentage of elderly people increases, there is a corresponding increase in the demands placed on a country’s healthcare system. This means that governments must allocate more money and resources to healthcare while making sure this is not done at the expense of other social services.
- Increase in Dependency Ratio — In most developed countries, healthcare systems and pensions are funded by the government. To do this, governments rely on taxes, and this is where the problem lies. In an aging economy, the workforce is smaller; therefore, the amount of tax revenue is smaller. An aging population means greater demand for essential services and a decreased ability to meet that demand.
Facilities for Elderly Care
When looking at elderly care facilities, analysts typically define several types. These are as follows:
- Independent living apartments are small housing that provides living space for elderly people who can maintain an independent lifestyle and do not need medical care.
- Adult homes are licensed family homes that provide accommodation and care for older adults unable to live by themselves.
- Assisted living homes are like nursing homes, except that the level of care is not as substantial. Nursing homes provide care 24/7 and cover a broader range of services. An assisted senior living home caters to patients whose care needs are less than those provided by nursing homes. Assisted living facilities are usually part of the Assisted Living Program (ALP).
- Continuing care communities are designed to provide different levels of care, all contained within one location. They take care of all approaches and are structured to provide different levels of care all within one facility. For example, if a resident requires minimal supervision, they will be placed in a section that provides this. If a resident needs more extensive care, they will be placed in an area that provides it.
- Nursing homes are designed to provide care for seniors who can no longer live independently. They employ specifically trained personnel who provide round-the-clock care for residents.
The world’s population is aging, causing quite significant challenges for countries around the globe. An aging population causes substantial changes in economies and the structure of society. This global population creates more service-based economies and leads to substantial increases in public spending and a corresponding decrease in gross domestic product.
Meta title: Understanding the Impact of an Aging World Population
meta desc: The world population is getting older, affecting society and presenting challenges that may significantly affect how things work. Learn about this issue.