The growth of the aging population is often framed in the news as an economic drain on society.
In local community conversations I frequently hear similar negative sentiments regarding the aging of southwest Michigan’s population. Statements framing the increase in the older demographic as a problem to be solved, not as an asset to be tapped.
This narrative ignores the enormous positive impact that people 50 and older have on the economy and on the social fabric of our communities. The economic power of the 50-plus demographic is transforming economies and generating opportunities for every generation around the world, according to a recently released AARP report, the Global Longevity Economy® Outlook.
Despite accounting for only 24% of the world population in 2020, people age 50 and older accounted for about 34% of global gross domestic product (GDP) which was $45 trillion, or roughly three times the combined revenue of the 100 highest-earning companies in that year.
Americans age 50 and up contribute so much to the U.S. economy that they’d constitute the world’s third-largest economy if they were counted as their own country, according to the AARP report. The economic contributions of 50-plus Americans totaled $8.3 trillion, which puts them just behind the U.S. and China when measured by GDP.
Additional key findings of the AARP report show older adults account for roughly half of all consumer spending (56%) and support a full one-third of the world’s jobs. Now that’s a population worth attracting, retaining and supporting.
The economic impact of the 50+ population will grow significantly in decades to come.
In 2031, a short eight years from now when the first of the millennials turn fifty, the 50-plus age group will contribute $12.9 trillion to the U.S. economy. By 2050, when Gen Zers will be turning 50, the 50-plus age group will contribute $28.2 trillion to the U.S. economy.
Beyond GDP contributions, older adults play a significant role in non-paid contributions to our social fabric. From volunteering to childcare and caregiving for others, older people, on average, contributed the equivalent of $20,511 a year in unpaid work, the AARP study shows.
“Older adults are consumers, workers, caregivers, volunteers and serve other critical roles in our societies. Their contributions spur economic growth that benefits all generations, as well as communities and businesses,” said Jean Accius, Senior Vice President of Global Thought Leadership at AARP. “Policymakers and business leaders can benefit more fully from the global longevity economy by combatting age discrimination, encouraging multigenerational workforces, and tailoring products and services to meet the needs of a rapidly aging population.”
Contrary to the widespread view of older populations as an economic burden, the report “clearly shows that older adults are not a drain on society but a growing demographic that is transforming markets and is a key driver of economic growth, innovation and new value creation benefiting people of all ages,” says Jean Accius, senior vice president for thought leadership and international affairs for AARP, who led the research behind the report.
The dramatic increase in the number of people 50 and older in the United States – and in our community — has helped make them an economic force. The group now includes four generations: the “GI Generation,” the silent generation, boomers and some members of Generation X, while the first millennials will turn 50 in less than a decade.
More people are living longer, healthier lives, which lets them continue to work and contribute to the economy. Southwest Michigan is home to over 116,982 adults over the age of 50. That is 42% percent of the total population and projected to continue to grow.
“As the number of people over 50 grows, that age cohort is transforming markets and sparking new ideas, products and services across our economy,” AARP CEO Jo Ann Jenkins says. “And as people extend their work lives, they are fueling economic growth past the traditional retirement age.
“They earn wages, spend more money, generate tax revenue, give back to social causes, and create demand for products and services that stimulates job growth,” she says.
The Longevity Economy Outlook report draws on national data on how much people age 50 and older spend, earn working and pay in taxes. That information was used to project the group’s effects on the economy overall.
We are all aging. We would do well to ensure our communities are ones that are welcoming and inclusive of people of all ages. Designing communities that tap into, support and value an aging demographic will benefit us all and ensure people of all ages can experience Southwest Michigan as a great place to live, work, raise a family, and retire!
Christine Vanlandingham is CEO of Region IV Area Agency on Aging in Southwest Michigan. Questions on age or independence services? Call the Info-Line for Aging & Disability at 800-654-2810 or visit areaagencyonaging.org. The Generations column appears each weekend in The Herald-Palladium.