Thursday 17 October 2019

Dan O'Brien: 'People over 65 who are fighting fit should be seen as a valuable resource, not some sort of burden'

The latest survey of what the nation works at showed that last year more than one in nine people aged 65 and older was still economically active. Stock Photo: PA
The latest survey of what the nation works at showed that last year more than one in nine people aged 65 and older was still economically active. Stock Photo: PA
Dan O'Brien

Dan O'Brien

In recent weeks this column has discussed two social phenomena. The first was Ireland's birth rate. It has fallen to its lowest level since records were first kept in the 19th century. The second was that the Irish adult population has become the most educated in Europe - no other country in our continent has a higher proportion of grown-ups with third-level qualifications.

A third phenomenon - the growing relevance of the elderly in the world of work and so many other walks of life - is another worth highlighting, as Tuesday's Labour Force Survey did nicely. It showed that last year a record number of people aged 65-plus were still in the workforce.

The survey, conducted every three months by the State's statisticians, is not only the most important indicator on the state of the wider economy, it provides a wealth of other information too.

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The latest survey of what the nation works at (and doesn't work at) showed that last year more than one in nine people aged 65 and older was still economically active. That was around 50pc higher than as recently as the mid-noughties, and is one of the highest in Europe.

But the upward trend in older folk working is not unique to Ireland. It is, in fact, being driven by a near-universal phenomenon. Throughout the world, and in the rich world in particular, countries are getting greyer.

Ireland is no exception. In Census 2016, there were 638,000 people aged over 65 - 13pc of the population. That was the highest on record.

By the 2030s, this age-group is projected to reach the one-million mark. And by the 2050s, it is likely to comprise a quarter of the population.

It's true that Ireland now has a relatively young population. At present, the percentage of over 65s is the lowest in Europe. But if current trends continue, Ireland will have more oldies by the 2040/50s than any European country does now.

The two main reasons for ageing populations are falling birth rates and increased life expectancy. The latter is one of humanity's great achievements. The fact that we have a reasonable expectation for longer life is of enormous benefit to ourselves and our loved ones.

These vast improvements are obvious in historical terms. When Ireland achieved independence in the 1920s, the average life span was less than 60 years. Half a century later, it had risen to 70. Since 2010, it has been above 80. Projections for the next half-century suggest it will be close to 90.

The really good news is that this does not mean we will all be spending our additional years of life dothering around in nursing homes. Longer lives have also meant longer healthier lives.

What the experts call "disability-free life expectancy" has jumped. In 2016, an average Irish man who reached 65 could expect to live another 18.6 years, of which 12 will be healthy, and a woman another 21.1 years, 13.2 of which will be in good health. All these measures are, happily, on the rise.

It's worth noting that, in the European Union, Ireland has the second highest number of healthy years for women over 65 and the third highest for men.

Along with other improving health measures, this is important context for regular debates over the nation's alcohol intake, obesity and health system. While there are good reasons for concern and scrutiny in all these areas, excessive bad news can drown out the good.

From an economic point of view, ageing is usually portrayed as a bad thing.

The so-called "pensions time-bomb", for instance, is something most readers of these pages will have heard about.

As noted in previous columns, it will be well worth keeping a close eye on how (older) neighbouring countries handle these challenges so that policy mistakes can be avoided and best-practice adopted.

One part of the solution will be to persuade and oblige people to work longer, as is already happening.

The State pension eligibility age will rise to 68 from 2028. Late last year, the compulsory retirement age for most public servants was moved from 65 to 70. The Government has encouraged similar moves in the private sector to support a more age-inclusive work culture.

There is undoubtedly economic potential here. The growing stock of experienced workers over 65 who are fighting fit should be viewed a valuable resource, not a burden.

A report carried out by professional services firm PwC suggested that Ireland could boost its GDP by €15bn if the proportion of older people at work rose to Sweden's level.

Some people are perfectly happy with all of this, actively preferring to be in employment for longer.

Work can provide meaning, enjoyment, routine and a social outlet. The extra income from part or full-time work can raise standards of living and fill the pension pot.

For others longing for their last day at work, the idea of later retirement doesn't go down well.

But because people are living longer does not mean that pension funds are growing magically. Whether we like it or not, rising life expectancy will mean later retirement for most.

A final thought - with pensions and savings, the over-65s are big consumers. In Europe, the "silver economy" is worth trillions of euro. One study by Oxford Economics predicts that spending by over-65s could come to account for one-third of the EU's economy.

In addition to spending power, retired people play a crucial role in caring and volunteering, both of which do not show up directly in the GDP statistics as no money transactions take place. With the mid-term break this week, there's plenty of evidence of children being looked after by grandparents while parents are at work.

Even after reaching an arbitrary age defined as "old", there's nothing stopping us from being very productive members of society.

Irish Independent

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