Billions contributed by older people

Far from being a drain on society, older people are huge contributors to the economic and cultural wellbeing of their nations, according to the third annual HSBC Future of Retirement study.

Conducted with Oxford University’s Oxford Institute of Ageing, The Future of Retirement project surveyed 21,000 people in 21 countries and territories.

The study explodes the myth that older people are dependents whose care drains vital resources from nations struggling to cope with ageing populations. In fact, through taxation, volunteer work and the provision of care for family members, HSBC has found that those in their 60s and 70s are the foundations upon which their nations build.

In the UK, for example, HSBC calculates people aged between 60 and 79 contribute £5.5 billion each year in tax payments, £4.2 billion in volunteer work and over £50 billion in family care.

Stephen Green, Group Chairman of HSBC, said: “We are living longer and, in many societies, living better than ever. This should be a cause for celebration, but recognition of this achievement is too often buried beneath concern over the funding of retirement. This unique study shows that we should not allow such fears to obscure the enormous contribution that those over 60 make to all of our lives.”

Clive Bannister, Group Managing Director, HSBC Insurance, commented, “It is clear that we need to rethink our approach to later life and to understand and appreciate the value of the work our older people do every day. The ageing of the world’s population over the next half-century will bring fundamental change to societies. Understanding the issues created by changing patterns in society is crucial to how we support both our customers and our employees.”

Drain or gain?

The HSBC Future of Retirement study found that a fifth of people (19 per cent) aged 60 – 70 volunteer, with a further one in six (15 per cent) over half (56 per cent) of those giving as much as half a day each week. In the US, the over 60s provide 3.67 billion hours per year of voluntary work. At the federal minimum wage of $5.15 per hour, that’s worth $18.9 billion every year. In the UK, people over 60 contribute 792 million voluntary hours per year, which at the minimum wage of £5.35 an hour is worth a total of £4.2 billion.

This isn’t limited to mature economies. Older people in transitional economies also make significant voluntary work contributions. For example, in India, people over 60 give over 1.3 billion voluntary hours per year worth a total of £192 million (or 15.8 billion Rupees) to the economy.

Across the globe, large proportions of the over-60s remain in work. In mature economies, between a fifth and a half of people are still in work in their 60s. Even in transitional economies, there are large numbers active in the labour market in their 60s and 70s.

The research also indicates that the trend of taking early retirement in mature markets, with the exception of Germany, is declining. People not only expect, but want, to continue working. Worldwide, seven out of ten people (71 per cent) currently in work, who expect to continue working rather than retiring early, say it is because they want to. Only in Russia, India, the Philippines and South Korea, is there a strong feeling that individuals have to work longer than they would prefer.

Professor Sarah Harper, Director, the Oxford Institute of Ageing, said, “The HSBC research revealed that older people make a substantial contribution to the family in financial, practical and personal care and support. The value of this social care and support within the family is enormous at over £50 billion, or around 3% of GDP, in the UK alone.”

Globally, more older people provide financial, practical and even in some cases, personal care, than receive it. For instance, of those providing financial support,16 per cent of those in their 60s and nearly one-third of those in their 70s provide financial support to grandchildren. Older people in all of the mature and most of the transitional economies surveyed, provide substantially more financial and practical support than they receive.

70 is the new 50

According to HSBC’s research, people the world over are now able to live the lives at the age of 70 that previous generations would have enjoyed at 50. People in their 60s and 70s generally feel in good health, and there are only small differences between people of this age and those in their 40s and 50s in terms of control and quality of life.

In mature economies, three quarters (75 per cent) of people in their 60s feel in good or very good health. The highest proportions of healthy people in their 70s are to be found in Canada (76 per cent), the UK (73 per cent) and the United States (72 per cent). But this isn’t a Western phenomenon. Generally, the transitional economies surveyed report good levels of health too.

Moreover, to go above and beyond perceived health, the survey identified 11 everyday tasks that most people undertake regularly and asked if they caused them any difficulty. Globally, less than a half of those surveyed had difficulty with any of the daily tasks listed.

Family - older people are the cement

The shape of the family is changing. In mature economies, falling birth rates and increasing longevity have meant that families are smaller, with more members of each family still alive - creating ‘beanpole’ families. We now have long ‘skinny’ families with an increasing number of four- or five-generation families, with fewer people in each generation. These ‘beanpole’ families are also often being joined together through remarriage.

Professor Harper continued, “While we have fewer brothers, sisters and cousins, we not only have more living parents, grandparents and great-grandparents than ever before, but we also now enjoy increasing numbers of step relations. So, while some commentators lament the decline of the family, in many ways it is thriving, and HSBC’s research bears this out.”

Families define who we are. Around the world, the majority of people around, two-thirds say they are defined by their family.