A new age: Is the UK’s ageing population a problem?
An ageing population in the UK means the number of Britons who are over 85 years old is expected to double between now and 2043. Is the UK ready?
How do UK general election opinion polls help investors?The Office for National Statistics recently released its projection of how the United Kingdom’s population will grow in the coming 25 years, and the rate at which the population is ageing.
Between now and 2043, the number of people living in England, Scotland, Wales and Northern Ireland is set to rise from 66.4 million to 72.4 million – reaching that all-important psychological barrier of 70 million by the middle of 2031.
This UK population breakdown comes with its own challenges, especially with regards to infrastructure. A growing population means substantial levels of housebuilding are required to satisfy demand. Although 173,660 homes were completed in England in the year to June 2019, this is substantially below the target of 300,000 that the government had set as it sought to address a national shortage. In January, the housing charity Shelter warned that 3.1 million homes need to be built in the next 20 years to help those living in poor conditions, those unable to buy a property because of unaffordable rent and for older renters.
On top of all this, there are other practicalities that need to be addressed. Roads and railways are already congested, meaning significant levels of investment are needed to ensure they don’t buckle under the demands of Britain in the 2040s. The National Education Union claims the country is “facing the worst shortage of school places for decades” – resulting in overcrowded classrooms and families struggling to find an educational facility close to where they live.
But nestled in the ONS figures was another daunting statistic – a projection that potentially illustrates the biggest challenge that the UK faces in the decades ahead: the number of people aged over 85 is expected to almost double by 2043. Here, we’re going to look at the impact that Britain’s ageing population could have on the economy – and explore the big ideas that governments and businesses are pursuing in the quest to prepare for this ever-increasing demographic.
Britain’s ageing population
For the government, Britain’s ageing population presents some financial headaches: not only are there going to be substantially more people claiming a state pension, but they will be living longer too. As of 2017, there were about 300 pensioners for every 1,000 working-age individuals in the UK – a figure that’s set to leap to 375 per 1,000 by 2042. Meanwhile, someone who turns 65 in 20 years’ time can expect to have a life expectancy that’s two years longer than someone who celebrates their 65th birthday today.
All of this has left economists scratching their heads – trying to ensure that the financial burden of delivering state pensions doesn’t become unsustainable, all while ensuring that future generations are treated fairly. Thankfully, the government has a magic number that it hopes will achieve this. As of 2007, Britons were spending 32 per cent of their adult life receiving a state pension – and under current plans, the retirement age is going to increase in line with life expectancy to ensure that this proportion of time remains the same. The state pension age was due to rise from 67 to 68 by 2046, but now this date is being brought forward by seven years. Research suggests this will help offset some of the costs of supporting a larger group of older Britons – a one-year increase in the entitlement age is the equivalent to saving 0.3 per cent of GDP, and if everyone worked for that extra 12 months, GDP would grow by 1 per cent.
Although making everyone work for an extra year sounds simple, there are some challenges that need to be addressed when it comes to the implications of an ageing population. A report by the UK’s Government Office for Science said a key priority will involve tackling negative attitudes towards older workers and enabling them to reskill as industries become obsolete and new ones emerge.
Technology also needs to be at the forefront of the UK’s healthcare provision, as increases in life expectancy are coupled with an increase in chronic conditions and other illnesses. With the NHS already under strain in 2019, home-based health monitoring equipment and big data are being touted as areas with immense potential. The report’s authors also speculated that the development of 3D-printed joints and organs, therapeutic robotics and personalised medicine could transform healthcare in the future – along with GPS trackers for dementia sufferers and virtual medical appointments. That said, none of this would be easy. Britain’s ageing population can sometimes struggle to get to grips with new technology, and although many of these initiatives would prove cost-effective in the long run, the initial costs can prove prohibitive.
There is cause for optimism. An ever-expanding group of Britons in retirement is set to contribute towards thousands of new jobs and even new industries – keeping them healthy and ensuring they can make the most of their leisure time. New products are emerging that focus on safety, remote care and smart living too. Artificial intelligence devices are providing lonely pensioners with easy ways to stay in touch with their loved ones, forge connections with their community, and receive reminders to take their medication. Robotic (yet realistic) animals are being developed to give them companionship – with toy dogs and cats that interact just like a live pet would. Pensioners undergoing physical therapy are being given access to virtual reality tools that personalise the recovery process around an individual’s needs and abilities.
The make-up of the UK is constantly changing. Forecasts provide a good indication of what lies ahead in the decades to come, but acting upon these estimates – and developing suitable infrastructure ahead of time – will be a decisive factor in whether older Britons, and their families, live a long, happy and healthy life.
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