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Ageing global population and its consequences
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Ageing global population and its consequences


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How an aging workforce will impact global economies in 2045..

How an aging workforce will impact global economies in 2045..

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  • 1. Our ageing world RBS economist Stephen Blackman examines the impact of a smaller workforce Societies are getting older. Workforces are shrinking or growing less quickly as a proportion of the population... Growth slows With no productivity boost, economic growth may stall in most developed countries ...but does worker pay rise? A labour shortage gives workers a stronger hand in pay talks. At best, this may ease downward pressure on pay Balance sheets shift Demand for mortgages and loans weakens. Fewer workers = fewer deposits. Savings drawn down Stocks sold Older investors sell shares in favour of fixed income Services strained Fewer workers support more retirees. Welfare systems are strained Migration Germany, the UK, Spain Italy and France alone would need c.92 million migrants to fill the worker gap Female participation More women workers will help, but there aren't enough. e.g. Germany would require over 100 per cent female participation Increased productivity Everyone will have to work smarter and harder. Sources: IMF, Federal Reserve Bank of San Francisco, UN Department of Economic and Social Affairs, European Commission. Forward projections are not a certainty. Retirement age A higher retirement age is the more likely option - by an average 7 years in the developed world 37m 39m By 2050 society will face tough choices to fill the worker gap 40yrs 44yrs 50m 37m 44yrs 53yrs 75m 51m 45yrs 56yrs China USAJapanGermany UK NumberofworkersMedianage Deposits Withdrawals 2010 2045 891m 803m 35yrs 48yrs 37yrs 40yrs 187m ...with consequences across the economy Key 70.8% 2010 130.4% Required 12 6 39 215m
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