When working at the age of 65 becomes a norm

Governments should invest in education for the seniors in the wake of an ageing population

PUBLISHED : Tuesday, 05 November, 2013, 1:52am
UPDATED : Tuesday, 05 November, 2013, 1:52am

When Prince George was born earlier this year, many people celebrated the new member of the British royal family. But little George, like many babies born in the same generation, is set to have a longer working life than us today.

German fund house Allianz Global Investors recently released a report, titled "The world when Prince George becomes king", on the challenges facing the ageing workforce.

The newborn baby prince is expected to become king only when he turns 65 or older due to the longevity of his family members - his great grandmother Queen Elizabeth is 87 years old and is still on the throne. His grandfather Prince Charles will turn 65 this month.

The report estimated that by the time Prince George turned 65, his parents William and Kate were quite likely to still be around. According to the United Nations, there are an estimated 410,000 people over 100 years old today, and by 2078 the number will rise to 11.3 million. So at 65, George will be more middle-aged than a senior, and he won't be alone.

While that looks old from the work's point of view by today's standard, it will not be so much in 2078. By that time, it would be usual for people over 65 to be working full-time.

"There will probably still be some form of government support for seniors, and people will continue to save for their old age, but people in 2078 will be working later in life. They'll be healthier and more motivated to work, so the biggest policy challenge today is investing in their education so that they have the skills they need tomorrow," said Volker Deville, Allianz's executive vice-president.

Hong Kong faces the same ageing problem. A government report said the city's workforce was projected to shrink in five years. By 2041, only 1.8 people of working age - defined as those between 15 and 64 - will support one dependent elderly person financially, down from 5:1 this year.

One of the government's so-called proposals to solve the problem is to encourage more women and retirees to return to the workforce. Official data shows there is a potential workforce of 1.6 million who are now economically inactive, including 525,000 women homemakers aged 30 to 59 and 240,200 retirees aged 50 to 64.

The fact is many retirees do not need to be encouraged to work. They have difficulties getting a job. One does not need to wait until 65 to learn that it is hard to find a job for those over the age of 50.

The retirees do not need encouragement - companies need encouragement or tax incentives for them to hire retirees.