Tuesday, May 13, 2014

Age invaders reads The Economist ...

Birth rates in much of the world have declined steeply. According to the UN’s population projections, the standard source for demographic estimates, there are around 600m people aged 65 or older alive today.

In 2010 the world had 16 people aged 65 and over for every 100 adults between the ages of 25 and 64, almost the same ratio it had in 1980. By 2035 the UN expects that number to have risen to 26.

In rich countries it will be much higher (see chart 1). Japan will have 69 old people for every 100 of working age by 2035 (up from 43 in 2010), Germany 66 (from 38). Even America, which has a relatively high fertility rate, will see its old-age dependency rate rise by more than 7%, to 44. Developing countries, where today’s ratio is much lower, will not see absolute levels rise that high; but the proportional growth will be higher. Over the same time period the old-age dependency rate in China will more than double from 15 to 36. Latin America will see a shift from 14 to 27.The evolution of the economy will depend on the way policymakers respond to the new situation. It will be a world in which ageing reinforces the changes in  income distribution … (April 26, 2014. The Economist)