The Economic Problem Of Population Ageing

1252 words - 5 pages

In the contemporary world, the economic problem of population ageing caused is revealing gradually. UNESCO provides a standard that a single country or region in the population over 60 years is more than 10% of the total population, which is into the aging of the population. Both of developed and developing countries in recent years have to face more serious aging impacts for economic progress. According to population prospects (2009), the whole world will accelerate the pace of ageing after 2010. More precisely, share of elderly people is 22% in rich countries and 8% in poorer countries, whereas these figures will rise to 33% and 20%, respectively. Why does aging become a problem? The U.S. Census study points out that the worldwide ageing of the population is not the history of emerging social phenomenon. Four reasons to explain it. Basically, this demographic shift springs from advances in medical technology, education and economic growth. The Economist (2009, p.2) notes that another passing cause is the baby-boomers who are going grey after the second world war The population structure change produce a series effects on employment, government finance and consumption level. As I see it, there are three potential crises in global economy which caused by graying.

Labour shortage

I focus on work force in graying countries. I put forward three reasons on this point. Firstly, increase in the proportion of the elderly and the reduction of newborn, leading to more work places no one succeed. Furthermore, an increasing number of elderly yearn for a happy and relaxed retire life ahead. In spite of retirement situation of each country is various, generally 55-70 years old. For instance, In Austria, the normal retirement age should be 65 for men and women is 60, but the actual average retirement age is 68.5, the proportion of elderly people work only 8% (7%+1%) of total employment (see chart 1). Consequently, in serious countries, some jobs will lack of employees to carry out.

Secondly, in order to promptly resolve the shortage of labour caused by ageing, many countries have extended the time of retirement of the elderly. To illustrate, China plans to start gradually raise the retirement age from 60 to 65 from 2010. However, this approach may give rise to many controversies. Provided that the retire time to be late, civil servants will support this resolution. As a consequence, a number of university graduates will more difficult to find a job, and some laid-off workers will face delayed pensions; therefore, that government need to consider a wide ranges of citizen interests.

Lastly, Skirbekk of the International Institute (The Economist, 2009, p.10), researched the relationship between age and personal productivity, reached that productivity in various job descends gradually in middle age. As a common sense, when people reach middle age, health and intelligence will begin to decline; thus the production efficiency of the elderly will not...

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