Cashing in on aging
Some time ago, my family and I visited an ailing octogenarian aunt brought home from abroad by my cousin (her daughter), who had long been residing in Europe with her Swedish husband and their children. My aunt had broken her ankle in a household accident, but with their busy lifestyle and expensive health care in Europe, my cousin saw it fit to have her cared for and recover here at home. And so she brought her to a little-known specialized private institution catering to ailing foreign senior citizens, located in their hometown of Cabuyao, Laguna (it turned out that my aunt was the only Filipino patient at the time). Discovering that facility inconspicuously located in one of the town’s barangays made me wonder how many more of such businesses exist elsewhere in the country.
That nursing home is but one of many ways that enterprising investors are riding on a global trend that is particularly pronounced in affluent countries in Europe and North America, and in nearby Japan: that of aging populations. Longer life expectancies are dramatically changing country population profiles over the years. More and more people are living beyond 80 years, which has made senior citizens much more prominent in the population of the world more than in any period of human history. The fastest-growing population segment in the developed world is in fact over 80 years old, and because women tend to outlive men, women dominate this age group at a ratio of 2 to 1.
Projections by the United Nations have the number of people aged 60 and above doubling from around 600 million in 2000 to 1.2 billion in 2025, rising further to 2 billion by 2050. Two-thirds of all older people currently live in the developing world; the UN projects this figure to rise to three-quarters by 2025. But unlike past generations of the elderly, the coming cohort of senior citizens would be the first generation to age with a generally higher level of health and education. This arises from improvements in public health and education owing to dramatic technological improvements. In particular, public health has been uplifted by advancements in the medical sciences and technologies for disease prevention and control. The level and reach of education have similarly been enhanced by technological advancements in the neurosciences and in information and communication technology.
Within the general scenario of aging populations, five things distinguish the new generation of senior citizens from their predecessors: They are much more numerous, more healthy, more educated, more wealthy and more active. Ilona Kickbusch and Prisca Boxler, in a 2009 paper “Demographic Challenge,” wrote: “Who would have thought in the 1960s that the Rolling Stones would still be touring 40 years later, or that the audiences of many rock concerts would be well into their sixties! Who would have thought that the sale of electric guitars would peak in Japan when the first baby boomers started to retire. Nobody could have imagined the Internet, but who would have thought that the largest group using Internet dating would be people over 50?”
An increasingly dominant segment of the population, this age group is challenging notions of retirement and, even more, the perception of “being old.” The authors continued: “With improved health, education and economic security, this generation is able to continue to enjoy traveling, renovate their houses and buy luxury cars. Consequently, it comes as no surprise that the average age of a Porsche buyer is 58. Being above 60 no longer means looking, behaving and acting in the image of a grandparent of yesteryears. They run marathons, go bungee jumping, go out in the evening, work as volunteers—in short, they are visible and they are active.”
Along with higher life expectancies, reduced fertility rates are transforming population profiles in those erstwhile rich countries into an inverted pyramid where senior citizens will dominate and young people will comprise a narrow base. This phenomenon is already causing serious problems in their social security systems, as there are now more retirees drawing from the system than working-age citizens paying into it. Exacerbated by shaky government finances, governments are being led to reduce social security benefits and raise the premiums that today’s workers have to pay—a surefire formula for social unrest, already manifesting in Europe.
The Philippines is well positioned to cash in on various opportunities from these global aging trends. Our demographic pattern has been different from much of the world, especially neighboring Asian countries, because of a persistently high population growth rate. The result is a population profile where the working-age population continues to be dominant, thereby providing a large labor pool seeking employment and livelihood opportunities. With the aging trends overseas, obvious opportunities arise in geriatric products and services, including organic foods, medical tourism, caregiving/hospice centers and retirement estates.
At the same time, rising dependency ratios (non-working relative to working population) in those countries due to growing numbers of retired persons will lead to even further tightening in their labor markets. This means that job opportunities for overseas Filipino workers (OFW) will remain high and growing in the next 20 years, even in jobs well beyond products and services focused on senior citizens.
Given global demographic trends and prospects, then, it seems that the OFW phenomenon will be with us for much longer than we think.
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