Population aging is taking place throughout the Americas, with the elderly expected to grow faster than the overall population between 2018 and 2025, according to a report by London-based analytics firm Global Data.
The report found Canada already has more elderly people than children in its cities. And in the U.S., the same is expected over the next 20 years. By 2025, it projected that 141 cities in Canada and the U.S. will have old-age dependency ratios (the ratio of elderly to working-age people) of more than 30 per cent.
These aging populations place stress on government finances and services, noted the report. “Low birth rates and an increasing old-age population will affect social insurance, public pension and health-care systems, thereby impairing the existing social support system and ultimately leading to long-term fiscal gap,” said Aditi Dutta Chowdhury, economic research analyst at Global Data.
Grappling with these issues requires reforms to public pension and health-care systems, noted the firm, along with policies to promote greater workforce participation by women and the elderly.
“Pension reforms across the countries will depend on the individual country’s current system but higher retirement age was the key recommendation in most countries,” said Chowdhury. “However, increase in the retirement age should be accompanied by an improved disability system to protect the vulnerable workforce, who might not prolong their career due to poor health.”
While rising life expectancy and declining birth rates have signalled population aging in North America for some time, the report also found that people are aging at a faster rate in cities in South and Central America.
For instance, the report found the elderly population in South and Central America is expected to grow by 33.5 per cent between 2018 and 2025, compared to 14.9 per cent in North America. The growth rate differential is attributed primarily to increases in life expectancy in South and Central America, which has risen by 22 years over the last 50 years.
While the region still has a relatively large working-age population, the report said it also faces the prospect of rapid aging in the years ahead, due to declining birth rates.
This article was originally published on Benefits Canada‘s companion site, Advisor.ca.