The commendable breakthroughs in biological and medical sciences in the 20th century have led to a longer life expectancy. There are constant Medical discoveries. Healthy ways of life have been discovered and adopted. Some birth rates have dropped.Some nations, at times, have limited the number of children per family. Not a bad idea. In contrast, these achievements knock the issue of increases in the aged population all over the world. So, how will we deal with this increased aged population in future times ?
Studies have suggested that there is/will be a considerable decrease in the figure of working people above the retirement age of 65. So if life expectancy continues to increase as it is now, then the scenario will become worse as there will be more people out there having pension commitments. This is an economic burden. You can’t impose more and more taxes on the diminishing working population. Compulsory saving should be started. Just a small percentage of ones earning…quite simple.
Some experts out there are trying to lessen this issue by arguing that this comparison of dependency ratio and retirement age scales should not be rigid and this should be reviewed in accordance with the changes that occur from time to time. Experts are on the view point to manage a balance of percentage increase between the retirement age and working population figure. Some European governments have already introduced increments in the retirement ages to address this issue seriously. Maybe retirement can be stretched out to 67 instead of 65 ? ….2 more years.
One of the severe impacts of an aging population is the balance between the government spending and revenue collection. If retirement age remains fixed and life expectancy increases then there’s more dependency towards the older. These people are no longer paying taxes.
Different taxes on the working creates a sense of injustice and raises several questions about the equality . This can discourage working inclination and also stop the investors from investing. This is all part of a productive economy. Fall out of foreign and domestic investments hurts the economy.
Ever increasing aged population also plays a sad part in the shortages of the workers and hardworking . The constant wage levels and the taxes hiking generally upset the workers and if the issue is not resolved by the concerned authorities then these workers may quit working . Organizations may feel stuck and left with no choice than to offer lucrative wages to the workforce . This stretches the gap between the productivity and production related expenditure.
The effects on certain sectors booming is also prominent when the aged population increases, as there are now more demands for products and services for the older citizens. The goods for older people are not made for carrying out constructive tasks. Increased demands for such products and services will concern the government . Think of a governments budget. How much is going towards medical needs ?
If people save their money or their pension , this means less money is spent. So, it’s really like a two sided coin. People need to save, but for things to keep moving , businesses need their customers. How much do the government need to serve the people ? Health needs to always be a priority , but the big one is growing the countries economy.
In conclusion, older people may seem to be a burden for the economy but we should not forget that the experience of some older people whom were at authoritative positions in their past can make the marked effect in the society if involved in educating the young people. Older people are seen as the blessing in many cultures of the world and it should not be prudent enough to counter their beliefs and fundamentals. The aging population still contribute in a lot of aspects and this issue needs to be addressed by sensible policies while maintaining the balance and respect in the society too!