The true costs of ageing | The Economist

The rapid ageing of wealthy nations demands a fundamental rethink in care, work, and retirement.

Wealthy nations are experiencing rapid ageing, with one in four people expected to be over 65 by 2050. While longer life expectancy is a success, it presents serious economic challenges. The traditional model of life—education, work, retirement—is unsustainable, as care for the elderly places a growing strain on resources. Societies must find ways to provide high-quality yet affordable care for ageing populations.

Countries like Japan are already grappling with this issue, as seen in towns like Yamakita where population decline has led to the closure of schools. The growing “dependency ratio” highlights how fewer workers support increasing numbers of retirees, leading to higher costs in pensions and healthcare. Attempts to reform pension systems, such as raising the retirement age, have faced protests, but incremental changes may not be enough to solve the problem.

Many are now challenging traditional views on ageing. People like 68-year-old Julie Ford are reinventing themselves later in life, continuing to work or start businesses. Such initiatives can unlock untapped economic potential and improve mental and physical health. However, ageing is experienced differently across professions, and not everyone can work into their 90s. New approaches to retirement flexibility could help alleviate the burden on society.

Countries must also rethink social care. Models like the Netherlands’ Buurtzorg provide community-based care, where nurses have autonomy to address patients’ needs more effectively. This approach has been shown to save costs while improving care quality. Ageing populations are both an opportunity and a problem that requires bold, systemic changes rather than minor adjustments.

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