If demography is destiny, then older folks are set to take over the world. By 2050, there are likely to be double the number of adults over the age of 50–as many as 3.2 billion–with all sorts of implications for wealth distribution, consumer spending, and business activity, a new report shows.
In fact, the 50-plus group is already pretty dominant, according to the American Association of Retired Persons (AARP) and Oxford Economics, a research firm. Those 50-and-over control 83% of wealth and more than 50% of spending in the U.S. The so-called “Longevity Economy” totaled $7.6 trillion in 2015.
“The amount of value driven by the 50-plus cohort in the U.S. is huge, even viewed on a global scale,” the report says. “If the U.S. Longevity Economy were to stand alone, it would, in GDP terms, be the third largest economy in the world–behind only the U.S. and China and nearly $3.5 trillion larger than Japan.”
The report notes that the age group is increasingly active not only in hoarding wealth–but creating it. Ten years ago, the 20-34 age group was responsible for the highest number of business-starts in this country. Now, the 55-64 age group creates more companies, figures from the Kauffman Foundation show. One in three businesses was started by people 50-plus in the last decade, belying the idea that all entrepreneurs are young and carefree. (In fact, at the current rate, Millennials will be the least entrepreneurial generation on record).
Because many people are not prepared for retirement, or because they like working, the 50-plus cohort is likely to grow as a share of the overall workforce, the report says. The big question is whether the group will push younger people out, leading to higher youth unemployment. The age group is most employed in management and financial occupations, though one-in-five is self-employed, according to government figures.
As you would expect, the AARP argues that we should pay more attention to the needs of the “Longevity population” and come up with “dynamic approaches in understanding and delivering the types of goods and services demanded.” What’s certain is that older people will making ever louder demands in the future, whether the rest of us are listening or not.
See more from the report here.
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