Age does not weary them nor does work

The rapid graying of the world's population is the subject of many newspaper columns and scholarly articles. Readers are left with images of countries weighed down by retirees, under-funded pension plans and medical systems on the verge of collapsing under the exponential increase of aging invalids kept alive by expensive drugs. While economies may be hurt by a lack of younger workers, and health systems will indeed come under strain in aging societies, recent studies highlight the need to radically change our mentality toward senior citizens.

It is true that aging is already quite advanced in a number of developed countries. In Japan, for example, the proportion of people over 60 is due to rise from a third of the population to 40 percent by 2040. The ratio will be similar for Germany by then. Developing countries are generally younger but some are aging fast enough to catch up soon with the developed world. Estimates for 25 years from now show people over 60 will account for 30 and 40 percent of the Chinese and South Korean populations, both higher than that in the United States.

But people are living longer because they are healthier. This implies they can remain socially and economically active much longer. Indeed, it appears that today's senior citizens can give the young a run for their money. A survey of 20 developed countries by Gary Burtless and Barry Bosworth of The Brookings Institution found that despite the crisis, workforce participation rates of 60 to 64-year-olds increased on average by 1.5 percentage points per year between 2007 and 2012. This was accompanied by a significant increase in participation by those in their late 60s and early 70s. Moreover, the rise in participation rates appears to be accelerating.

Why is this happening? Are older workers somehow clinging to jobs by accepting lower pay? Far from it. The 2011 data from the US show that men aged between 60 and 74 enjoyed a 22 percent premium in hourly pay over those aged between 25 and 59. Similarly, older women enjoyed a premium of 10 percent over their younger counterparts. Older workers, it seems, are more than able to leverage their skills and experience in the labor market.