Healthy ageing, preventive healthcare, labour market reform, and financial resilience planning are all potential approaches to support a global population that is older than it has ever been, says a Citi report developed with Oxford Martin School involvement.

Citi Global Perspectives and Solutions’ Embracing Demographic Transition report makes the compelling case that the economic impact of older societal groups could be maximised in response to one of the most dramatic societal shifts of the 21st century – a demographic transition to a population that is older than it ever has been.

In the 19th century, no continent had a life expectancy of more than 40 years. By 2019, the average person could expect to live to 73 years old. Declining fertility compounds population aging, and it is driven by efforts in global development too. Rising rates of education and increased access to contraception have pushed down the number of children that families have.

Population aging has far-reaching consequences that governments, businesses, and wider society must reckon with. Economists have already warned about some of these consequences: a ballooning older population will be dependent, some say, on a working-age population that is too small to support it.

Governments and firms need to explore how to allow people to work in different ways and to develop much more flexible retirement and seniority structures to ensure demographic change is embraced as an opportunity

Citi’s report argues that, while the trend towards a population that is older than it ever has been is intractable, the trend towards an increasingly dependent one need not be.

Its key recommendations include:

• Maximising the economic contribution of older groups, including evolving labour markets in support of longer working lives.
• Supporting economic resilience in later life through financial inclusion and incorporating longevity into financial planning.
• Preventing the onset of dependence by supporting healthy aging, including the shift to a more preventive healthcare system.
• Ensuring access to affordable healthcare for all, including boosting the supply of care work and joining up health and care systems.

Ian Goldin, Oxford University Professor of Globalisation and Development, director of several research programmes at the Oxford Martin School and guest contributor to the report, said:

‘Healthy aging is key to adapting to demographic changes. One of the challenges of the combination of increasing life expectancy and declining fertility is the risk of many more elderly people becoming dependent on a declining workforce.

‘Governments and firms need to explore how to allow people to work in different ways and to develop much more flexible retirement and seniority structures to ensure demographic change is embraced as an opportunity rather than crippling families and economies.’

Carl-Benedikt Frey, Dieter Schwarz Associate Professor of AI & Work at the Oxford Internet Institute and Director of the Oxford Martin Programme on the Future of Work, was another guest contributor to the report.