How should population ageing be measured?

Jeroen J. A. Spijker, University of Edinburgh
Timothy L. M. Riffe, University of California, Berkeley
John MacInnes, University of Edinburgh

In 1950 people aged 65+ represented 1 in 12 of the European population. Today their share is 1 in 6. While declining fertility and infant mortality levels formed the basis for this growth from the late 1800s until WWII, e.g. through the defeat of child killing infectious diseases, since the 1970s falling old-age mortality has been an additional driving force. This ‘population ageing’ has worried policy makers because for every worker paying tax and national insurance there are more older citizens, with greater demands on social insurance, health and welfare systems and increasing volumes of morbidity and disability. The standard indicator of population ageing is the old-age dependency ratio (OADR). It takes the number of those who have reached the state pension age and divides it by the number of ‘working age’ adults to measure the dependent elderly population relative to those who pay for them. For instance, the OADR increased in Europe from 12 elderly per 100 of working age in 1950 to about 24 today, and could double again to 47 per 100 of working age by 2050 (http://esa.un.org/wpp/Excel-Data/population.htm), thus increasing policy makers’ concern. However, the OADR is not ‘fit for purpose’: It counts neither the dependent elderly nor those who sustain them, as many of working age are not employed. It merely takes a cut-off point (the state pension age) and assigns adults to the two sides of the ratio accordingly. Building on research by others, we therefore propose several alternative and more objective measures of ageing that consider improvements in old-age survival, time to death and the changing employed population. Results for several European countries, the US and Japan show that society is ageing far less than previously thought.