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Demographics

The Problem of an Aging Global Population, Shown by Country

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The Problem of an Aging Global Population, Shown by Country

The Implications of an Aging Population

The world is experiencing a seismic demographic shift—and no country is immune to the consequences.

While increasing life expectancy and declining birth rates are considered major achievements in modern science and healthcare, they will have a significant impact on future generations.

Today’s graphic relies on OECD data to demonstrate how the old-age to working-age ratio will change by 2060, highlighting some of the world’s fastest aging countries.

The Demographic Debacle

By 2050, there will be 10 billion people on earth, compared to 7.7 billion today—and many of them will be living longer. As a result, the number of elderly people per 100 working-age people will nearly triple—from 20 in 1980, to 58 in 2060.

Populations are getting older in all OECD countries, yet there are clear differences in the pace of aging. For instance, Japan holds the title for having the oldest population, with ⅓ of its citizens already over the age of 65. By 2030, the country’s workforce is expected to fall by 8 million—leading to a major potential labor shortage.

In another example, while South Korea currently boasts a younger than average population, it will age rapidly and end up with the highest old-to-young ratio among developed countries.

A Declining Workforce

Globally, the working-age population will see a 10% decrease by 2060. It will fall the most drastically by 35% or more in Greece, Japan, Korea, Latvia, Lithuania, and Poland. On the other end of the scale, it will increase by more than 20% in Australia, Mexico, and Israel.

aging population chart

Israel’s notably higher increase of 67% is due to the country’s high fertility rate, which is comparable to “baby boom” numbers seen in the U.S. following the second World War.

As countries prepare for the coming decades, workforce shortages are just one of the impacts of aging populations already being felt.

Managing the Risks

There are many other social and economic risks that we can come to expect as the global population continues to age:

  • The Squeezed Middle: With more people claiming pension benefits but less people paying income taxes, the shrinking workforce may be forced to pay higher taxes.
  • Rising Healthcare Costs: Longer lives do not necessarily mean healthier lives, with those over 65 more likely to have at least one chronic disease and require expensive, long-term care.
  • Economic Slowdown: Changing workforces may lead capital to flow away from rapidly aging countries to younger countries, shifting the global distribution of economic power.

The strain on pension systems is perhaps the most evident sign of a drastically aging population. Although the average retirement age is gradually increasing in many countries, people are saving insufficiently for their increased life span—resulting in an estimated $400 trillion deficit by 2050.

Pensions Under Pressure

A pension is promised, but not necessarily guaranteed. Any changes made to existing government programs can alter the lives of future retirees entirely—but effective pension reforms that lessen the growing deficit are required urgently.

Towards a Better System

Certain countries are making great strides towards more sustainable pension systems, and the Global Pension Index suggests initiatives that governments can take into consideration, such as:

  1. Continuing to increase the age of retirement
  2. Increasing the level of savings—both inside and outside pension funds
  3. Increasing the coverage of private pensions across the labor force, including self-employed and contract employees, to provide improved integration between various pillars
  4. Preserving retirement funds by limiting the access to benefits before the retirement age
  5. Increasing the trust and confidence of all stakeholders by improving transparency of pension plans

Although 59% of employees are expecting to continue earning well into their retirement years, providing people with better incentives and options to make working at an older age easier could be crucial for ensuring continued economic growth.

Live Long and Prosper

As 2020 marks the beginning of the Decade of Healthy Ageing, the world is undoubtedly entering a pivotal period.

Countries all over the world face tremendous pressure to effectively manage their aging populations, but preparing for this demographic shift early will contribute to the economic advancement of countries, and allow populations—both young and old—to live long and prosper.

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Markets

Charted: The Gen Z Unemployment Rate, Compared to Older Generations

COVID-19 has impacted everyone, but one generation is taking it harder than the others. This graphic reveals the Gen Z unemployment rate.

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gen z unemployment

Putting the Gen Z Unemployment Rate in Perspective

There are more than 2 billion people in the Generation Z age range globally. These individuals, born between 1997 and 2009, represent about 30% of the total global population—and it’s predicted that by 2025, Gen Z will make up about 27% of the workforce.

Due to the global pandemic, unemployment has been on the rise across the board—but Gen Z has been hit the hardest. This chart, using data from the OECD, displays the difference between the unemployment rate for Gen Zers and the rate for older generations.

Note: The OECD defines the ‘unemployed’ as people of legal working age who don’t have work, are available to work, and have taken steps to find a job. The final figure is the number of unemployed people as a share of the total labor force.

The Generation Gap: Gen Z Unemployment

Compared to their older working-age counterparts, Baby Boomers, Gen X, and Millennials (Gen Y)—the most recent 2020 data shows that Gen Z has an unemployment rate of nearly 2x more in almost every OECD country.

CountryUnemployment Rate (Gen Z)Unemployment Rate (Millennial, Gen X, Boomer)
🇦🇺 Australia14.3%5.0%
🇦🇹 Austria10.5%4.7%
🇧🇪 Belgium15.3%4.8%
🇨🇦 Canada20.0%7.9%
🇨🇱 Chile24.8%9.6%
🇨🇴 Colombia27.5%13.9%
🇨🇿 Czech Republic8.0%2.3%
🇩🇰 Denmark11.5%4.7%
🇪🇪 Estonia17.7%5.9%
🇫🇮 Finland21.0%6.0%
🇫🇷 France20.1%6.8%
🇩🇪 Germany6.2%4.0%
🇭🇺 Hungary12.4%3.5%
🇮🇸 Iceland11.9%5.5%
🇮🇪 Ireland15.2%4.4%
🇮🇱 Israel7.9%3.7%
🇮🇹 Italy29.1%-
🇯🇵 Japan4.5%2.6%
🇰🇷 South Korea10.5%3.6%
🇱🇻 Latvia14.8%7.7%
🇱🇹 Lithuania19.5%7.7%
🇱🇺 Luxembourg22.4%5.6%
🇲🇽 Mexico8.0%3.8%
🇳🇱 Netherlands9.1%2.8%
🇳🇿 New Zealand12.4%3.3%
🇵🇱 Poland10.9%2.6%
🇵🇹 Portugal22.9%5.9%
🇸🇰 Slovakia19.3%6.0%
🇸🇮 Slovenia14.2%4.3%
🇪🇸 Spain38.3%14.0%
🇸🇪 Sweden23.8%6.4%
🇨🇭 Switzerland8.6%4.3%
🇬🇧 United Kingdom13.5%3.2%
🇺🇸 United States15.1%7.1%

Note: For the purposes of this article, we are only considering the Gen Zers of legal working age—those born 1997-2006. The rest—Baby Boomers, Gen X, and Millennials—are those born between 1946–1996.

The timing for the youngest working generation could not be worse. Gen Z is just beginning to graduate college and high school, and are beginning to search for work and careers.

Gen Z is also an age group that is overrepresented in service industries like restaurants and travel–industries that were equally hard hit by the pandemic. In the U.S., for example, around 25% of young people work in the hospitality and leisure sectors. Between February and May 2020 alone, employment in these sectors decreased by 41%.

Countries like Spain are facing some of the biggest headwinds among OECD countries. The country already has a high unemployment rate for those aged 25-74, at 14%. But the unemployment rate for Gen Z is more than double that, at over 38%.

Implications For the Future

While it may be true throughout history that this age group is often less employed than older cohorts, the share of labor held by those aged 15-24 dropped significantly in 2020.

labor share gen z

Note: This chart represents the data from G7 countries.

In terms of their future employment prospects, some economists are anticipating what they call ‘scarring’. Due to longer periods of unemployment, Gen Z will miss out on formative years gaining experience and training. This may impact them later in life, as their ability to climb the career ladder will be affected.

Starting out slower can also hit earnings. One study found that long periods of youth unemployment can reduce lifetime income by 2%. Finally, it is also postulated that with the current economic situation, Gen Zers may accept lower paying jobs setting them on a track of comparatively lower earnings over their lifetime.

Overall, there are many future implications associated with the current unemployment rate for Gen Zers. Often getting your foot in the door after college or high school is one of the hardest steps in starting a career. Once you’re in, you gain knowledge, skills, and the oh-so-coveted experience needed to get ahead.

The Kids are Alright?

One positive for Gen Z is that they have been found to be more risk averse and financially conscious than other generations, and were so even prior to COVID-19. Many of them were children during the 2008 Recession and became very cautious as a result.

They are also the first digital generation— the first to grow up without any memory of a time before the internet. Additionally, they have been called the first global generation. This could mean that they pioneer location-independent careers, create innovative revenue streams, and find new ways to define work.

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Misc

Who Americans Spend Their Time With, by Age

Ever wondered who Americans spend the most time with? This chart assesses how many minutes per day Americans spend with different people.

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Who Americans Spend Their Time With, by Age

If the global pandemic has taught us anything, it is that humans truly are social creatures. Most of us need community and connection to thrive.

But when people are not socially distancing and limiting their contacts, who do they choose to spend time with?

This interactive chart from Our World in Data reveals who Americans spend the most daily minutes with at different ages of their life, based on data collected between 2009 and 2019 through the Time Use Survey conducted by the U.S. Bureau of Labor Statistics (BLS).

Adolescence to Adulthood

In the average American’s teenage years, they spend most of their time alone and with their family. This makes sense, as the majority of people under 18 still live in a home with their nuclear family unit, meaning parents and siblings.

Jumping forward to a person’s early adulthood, 25-year-olds spend an average of 275 minutes per day alone, and 199 minutes with coworkers. This aligns with people in their twenties beginning to enter the workforce.

By age 35, people are still spending the most time with themselves, at 263 minutes per day. However, time spent combined with children and partners, the runner-ups, adds up to 450 minutes or around 7.5 hours a day.

AgeMost Time Spent SecondThird
15Family - 267 MinutesAlone - 193 MinutesFriends - 109 Minutes
25Alone - 275 MinutesCoworkers - 199 MinutesPartner - 121 Minutes
35Alone - 263 MinutesChildren - 249 MinutesPartner - 198 Minutes

Although people are spending more time with kids and partners as they grow older, this trend may shift, as women are having fewer children. More women today are obtaining an education and are entering the workforce, causing them to delay or entirely put off having children.

Interestingly, the mid-thirties also tends to be the stage of life where time spent with friends levels off and remains steadily low throughout the rest of one’s life, usually sitting around an average of 30-40 minutes per day.

Middle to Old Age

Upon turning 45, the average person spends 309 minutes a day alone, and in second place, 199 minutes with children. Time with coworkers remains relatively steady throughout someone’s forties, which coincides with the middle of career for most workers.

At age 55, time spent alone is still the winner, but time spent with a partner goes up to 184 minutes, and time with coworkers also moves up, pushing out time spent with children.

Age Most Time SpentSecondThird
45Alone - 309 MinutesChildren - 199 MinutesPartner - 184 Minutes
55Alone - 384 MinutesPartner - 184 MinutesCoworkers - 163 Minutes
65Alone - 444 MinutesPartner - 243 MinutesFamily - 65 Minutes
75Alone - 463 MinutesPartner - 253 MinutesFamily - 56 Minutes

Typically, time spent with children during the mid-fifties tends to see a sharp decline as children enter adulthood and begin to move out.

However, it will be interesting to see what impact COVID-19 has on future data. With implications such as job loss or reduced income, more children are staying at home longer or even moving back home. 52% of adult children in the U.S. today are living with their parents.

As people get closer to old age, around 65-years-old, they spend increasingly less time with coworkers as they begin to retire, and much more time alone or with a spouse. Then, from age 65-75, people consistently spend the most time alone, then with a partner and family.

Alone and Lonely?

One of the most significant trends on the chart is increased time spent alone.

time spent alone by age

By the time someone reaches 80, their daily minutes alone goes up to 477. This can be a problematic reality. As the population continues to age in many countries around the world, more elderly people are left without resources or social connection.

Additionally, while 1-in-4 elderly Americans live alone, the trend of solo living is going up across nearly every age group, and this trend applies globally.

who americans spend the most time with

But being alone does not necessarily equate to loneliness, as Our World in Data found that there was no direct correlation between living alone and reported feelings of loneliness.

It is not necessarily the amount of time spent with others, but the quality and expectations, that reduce loneliness.

Spending Time Together

Where and how we spend our time has a direct relationship to who we spend time with. More hours at home and off work can mean either more time spent with family, children, and partners, or more time spent alone.

Regardless of who we spend the most time with, the pandemic revealed the importance of human connection to our wellbeing. While many are still doing this through their screens or at a six-foot distance, 2021 could be the year we break out of our bubbles and get back to time spent together.

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