Behavioural norms, social expectations and policy have all morphed significantly from when your grandparents and parents were your age. Soon, there will be more people over 60 than under 15 for the first time in history, an irreversible change. This means sustaining ageing populations financially and socially needs work - we currently don't value our elders, nor view them as a growing population that will soon take over the world. The silver economy is here.
Insurers have a special role to play, since they are the only companies that can effect change in people's health through specialised health programs. These models are the shared value model, increasingly the model of choice in business. Capitalism has failed miserably at protecting people, animals and the planet, but the tide is slowing turning.
Shared value appeases everyone's needs in the transaction: for insurers to make and consumers to spend money in socially, environmentally and globally conscious ways. This way of doing business is by its very nature consumer driven, but works well for business, since it simply amounts to good economics for insurers: healthy people make fewer claims. The motivation exists on both sides.
Major global institutions are involved in figuring out how to manage and make the most of this change in demographics that favours the older - the WHO*, APEC*, G20, OECD*, UNFPA* and ILO* are all working on the ageing conundrum. Ageing populations need special products - phones with big numbers are a good example of 'old-fashioned' innovations that make light work for ageing bodies, but with technological developments, the sky is truly the limit. Establishing ways to enhance life, instead of just preserving it, is key.
For business, our ageing population provides some excellent opportunities, not only in what we sell, but in how we sell it. That is, company-wide cultural change in how we view and use our elders, primarily for economic benefit. The side-effects are improved social and personal circumstances.
Fashion, entertainment, retail, dining, and financial services are continuing to be cracked open for the older consumer, along with healthcare, the typical mainstay of spending in this demographic. Even filmmaking has turned its eye to the older audience recently. Accessibility is going to become more important, since being more vital doesn't mean living without disability - modern healthcare leaves more people alive, but sometimes profoundly disabled, since conditions that would previously kill us now do not necessarily.
Becoming age-friendly in the era of the silver and digital economies
New reports are coming out all the time to help us capitalise both socially and financially on being age-friendly. For example the G20 issued their report, Principles on the Silver Economy and Active Ageing; the OECD has some great reports on ageing and big data, the silver economy and coming soon, ageing and the digital economy.
Do we need a global strategy?
The World Economic Forum report How 21st-Century Longevity Can Create Markets and Drive Economic Growth says yes. The report in fact suggests that the World Economic Forum should be the driver of this global strategy, since it is uniquely positioned to assume a major leadership role in global action on ageing.
The WEF report discusses the idea of a virtuous cycle: the population ages, business leaders and innovators design things to suit them (and make money), the strategies create favourable conditions for the ageing, and then these markets stay strong, and so it goes on.
The report states that in 2017, 70 per cent of disposable income will be in the hands of those over 60. What's interesting is the defunct idea of a dithering old person has been replaced with active, bright 'older' (old but not out) idea, with these people having actively saved money in some way for their older age. This is the first time this has ever happened en masse, and the research is only becoming available now - it just hasn't happened before. Baby Boomers are our test subjects.
How life insurers fit into the silver economy
Longevity and quality of life mean insurers can play a vital role in creating products and service offerings that are actually innovative, as opposed to simply expansions of old ideas of a dying breed. Insurers can take advantage of a growing body of humans with more money - and higher expectations - than ever.
Most of the world's money is in the hands of those aged 60 and over already, with this population outspending every other group by US$400 billion every year on 'stuff' (US stats). This doesn't mean inequalities don't exist - obviously the disparities can be gaping chasms regionally and socioeconomically, but social policy has the power to make decisions that will ensure a vibrant silver economy where everyone benefits, not just those with all the money.
We all have a part to play in this transformation of the old becoming hip, and that change will start for many blinking through dollar signs. This everlasting search for riches in turn fast-tracks cultural change, just like tobacco ads in the 1920s, when women started smoking openly for the first time: a great marketing campaign brings cultural shifts like nothing else.
Commercial opportunities for risk insurers playing in the silver economy
Investing in the health of the insured works very well for insurers on many levels, but primarily the bottom line. Nobody else in our business world or government has quite the same leverage as insurers, and while it hasn't necessarily been used for the good of the nation in all areas, it is now being understood in a more comprehensive way: healthy people equals more profit, since insurers only pay out when someone is sick, injured, or dead. The health programs now implemented by almost all major insurers are a beneficial attempt to monetise healthy clients with very little cost - the risks drop, the client does all the work: shared value.
Providing money-saving incentives for better health is a simple tactic, but not the only one insurers, and other businesses, can move towards.
What everyone can do to promote the silver economy
Hiring older workers is becoming more fashionable, since the experience older people bring to the table is often extremely valuable. (There was a drop-off over the last few decades since hiring technological muppets wasn't good for the bottom line, morale, or culture. This has now changed, and everyone is mostly caught up.)
But this isn't the only reason. With an ageing customer base, having someone 'your own age' to talk to about your concerns can bring people - an employee and a consumer - together in a warmer, more human way. Having someone who understands your problem at a deeper level (due to age and experience), regardless of why they are on the other end of the phone, is just really nice. Nobody feels looked after or understood by the 20-year-old who answers the phone, unless you are also 20. Which most of us aren't. Kinship counts for something.
Making employee benefits suitable for your workforce also matters. We all now expect a much greater level of personalisation in our workplace and beyond - we want our personal circumstances to matter the way they do everywhere else in our lives, so we can be our best and most productive selves. That is, tailoring your employee packages and conditions to the employee.
It sounds simple, but the typical one-size-fits all just doesn't work. We are not robots. These packages may include extra superannuation contributions, university funds for kids, atypical insurance benefits, flexible working hours, and days off just because. Employees are the core of every business, and having satisfied employees makes for a better business. It's just economics.
Making the workplace age-friendly
Older people frequently say they feel invisible, particularly women. Why? Because our society does not value them. They are overlooked, dismissed, and disregarded at every turn. This is not only sad for them, but a real oversight on the part of everyone else.
Making a workplace age-friendly starts with education and training, potentially adjusting furniture as required (standing-up desks, large screens, adjustable headsets), and generally being more open to the idea that not just youngish people will be adding to the mix with their youthful exuberance and malleability. It also means being more accommodating to people's outside caring roles, be that of partners, parents, children, or other people in their lives that need them.
Getting older is not a disease, but things are different in many important and often unrecognised ways. Being older and at work needs to be ok, just like women needing maternity leave and equal opportunity has to be ok. Setting your workplace up for the lowest common denominator between 20 and 40 is shortsighted.
Understanding that getting older is a life-stage, not a disability
Recently we've been missing out on the wisdom and experience of our older populations at work. If you are over a 'certain age', finding a job can be really difficult, and the last decade of working life can be spent uncertain and burdened with a feeling of rejection. This needs to change. What a waste!
Being age-neutral and recognising the value of all ages in a supportive working environment means adjusting our ideas about each other. Capitalism has a lot to answer for, good and bad, with one casualty, at least lately, being our wrinklier friends. Thankfully capitalism will also bring them back. They're rich!
Bringing back the older worker as a valuable member of the team is not happening right now in a broad way, but it will, since who better to tell you what older people (you know, the ones with all the money) want than an older person?
Nobody's asking anyone to provide charity - becoming age-friendly is business, and makes economic sense.
The latest WEF report has some advice:
1. Companies need to continue to expand their market interests by creating products and services for this new demographic commercial opportunity.
2. Companies need to adopt and adapt to the changes internally in their workforce and workplace environments along the lines suggested by the World Economic Forum Guiding Principles for Age-Friendly Businesses (below).
3. Companies can use their social responsibility programmes – perhaps through shared value
frameworks – to support their commercial ageing strategies, and align workplace and workforce changes to the employment of older workers.
4. A culture shift should be encouraged in how what used to be called retirement is imagined and defined to engender a positive approach to human capital across the entire life course.
5. Public policy institutions in such core areas as education, health, social protection, transport,
housing and economic and financial planning must more closely align with 21st-century longevity, in all countries and regions of the world.
6. Policy should be initiated to provide incentives for working longer, differently and more flexibly; this would include tax incentives for silver entrepreneurship, pension and labour reforms, and wellness programmes for more active and healthier ageing.
7. Incentives for innovation in the health, financial and technology sectors should be designed and activated to encourage inventions that will add life to the longevity miracle. Were society, government and industry to follow these paths, the beginnings of a new global perspective and direction centred on longevity would be created, which would generate transformation, contribute to economic growth into the next century and successfully bring to bear the promise of global population ageing.
WEF Guiding Principles for Age-Friendly Businesses
- An Age-Neutral Workplace: Recognise the value of employees of all ages
- A Supportive Working Environment: Create a working culture that will provide access to and sustain employees regardless of age
- An Inclusive Culture: Accept and embrace employees across all ages
- Lifelong Learning and Participation: Keep opportunities available and open for learning and mentoring
- Financial Planning for Longer Working Lives: Inform all employees to gain more financial literacy to better serve their increasing needs over time
- Healthy Ageing: Encourage and support an active and healthy lifestyle
- Supportive Caregiving: Support employees as they honour their caregiving responsibilities
*World Health Organisation (WHO)
*The Organisation for Economic Cooperation and Development (OECD)
*Asia-Pacific Economic Cooperation (APEC)
*International Labour Office (ILO)
*United Nations Population Fund (UNFPA)