The Longevity Economy by Joseph Coughlin

The populations of the US and other industrialized countries are aging. The 50+ and 65+ age groups are growing both in numerical and in percentage terms. Today’s older populations are living proof of society’s success in tackling historically serious problems like violence, accidents, and public health.

Despite longer and healthier lifespans being clearly a good thing, longevity is often viewed in negative terms as a societal crisis or time bomb. According to the most common narrative, aging will create an overwhelming healthcare and caregiving burden, force a combination of tax increases and public austerity, and reduce economic growth and dynamism.

The mainstream modern narrative of old age originated in the 19th century during industrialization. As people’s social and economic networks grew bigger, old people started being viewed as a distinct demographic group rather than as one-off oddities. The medical establishment tried and failed to identify the cause of aging, settling on later-debunked ideas of how aging represents the permanent depletion of the body’s fixed store of vital energy. It was common for doctors to recommend that older people conserve their energy and exert themselves as little as possible. Due to the physical limitations of old age, older people found it painful to work at farms or factory jobs. In the industrial era’s efficiency-obsessed culture, employers began systematically enforcing mandatory retirement ages and discriminating in favor of younger workers. In its earliest form, retirement was an undignified state that represented a loss of livelihood, a loss of independence, and a loss of belonging in public life. In the early 20th century, the elderly demographic started being viewed as a social and economic problem for society. The problem of destitution in old age was greatly alleviated with private pensions and Social Security; since the eligibility for such programs depended on age, they internalized the idea that old age is a disability all on its own, even when not accompanied by specific diseases. After World War II, the private sector took the lead in selling a more cheerful “golden years” interpretation of old age, portraying it as a leisure-heavy reward for a lifetime of work. However, the broad outlines of the narrative on aging did not change. Old people are popularly viewed as both needy and greedy, a group that only consumes and never produces.

The list of retirement-age activities that are culturally considered “normal” is currently very short. Compared to earlier periods of life, old age is significantly lacking in celebratory occasions and milestones.

The next elderly generation is the Baby Boomer generation. The Baby Boomers have defied and rewritten the existing script for every previous stage of life up until old age. They are a generation so large that they have never had trouble getting businesses to accommodate their desires. The Baby Boomers will be the first generation of old people who are digitally savvy and unafraid of technology.

Today’s bland and poorly-fleshed-out cultural idea of old age is poised to come under heavy revision. This culture shift is likely to be led by women. The current cultural narrative of old age is not as well defined for women as it is for men, so women are more likely to see old age as a novel frontier that requires explicit preparation. Women bore the brunt of caring for their own elderly parents, so they have a much more detailed and realistic sense of how aging affects day-to-day life. Due to the high rates of divorce among the Baby Boomer generation (especially “grey divorces” among the 50+), women are being forced to look for belonging and support outside of traditional institutions like family.

There are many areas where a majority of the population disagrees with the current narrative, often wrongly believing that their view puts them in a minority. One such example is housing; despite the prevalence of marketing and stereotypes, most old people intend to remain where they are rather than move to a dedicated old-age community, to somewhere with a lower cost of living, or to a “traditional” retirement destination like Florida or Arizona. Large age-restricted communities exist and usually have high resident satisfaction, though these communities often have a rigid monoculture and their relationships with the outside world tend to be poor. Most old people do not self-identify as “old” (they reserve the label for people much older than themselves) and want to remain part of mainstream society. Age self-segregation appears to be past its peak and it looks like integration will be more common in the future.

Businesses are famously bad at developing products for and marketing to older consumers. Most products specifically targeted at old people are dumbed-down, bland, or medicalized to a degree that old people find insulting. Old people are often treated as medical patients first and as humans second. Senior-branded products usually only target basic needs like health while neglecting higher-order desires and aspirations. The products that prove to be most beneficial for old people are often products that were never explicitly designed for them in the first place. Nobody designed recent inventions like dating apps, social media, or gig economy apps with old people in mind, yet old people have benefitted more from them than any other age group. Old people perform a disproportionate share of what economists term “lead-user innovation,” finding unexpected novel applications for existing products.

Tailoring to old consumers is a huge and poorly-tapped business opportunity, but businesses are often making stabs in the dark. Part of the problem is the lack of old people in mainstream business. With workplaces becoming increasingly expertise-based rather than brawn-based, it should become easier than ever for people to continue to work into old age, but culture often hasn’t caught up with economic reality. Most of the 55+ population (especially those with university degrees) wants to “work in retirement” in some capacity, but they usually find the job market to be hostile to them. Many people, especially those in the 55-65 range, lose their jobs, unsuccessfully look for another one, then get discouraged and retroactively declare themselves retired. Especially in expertise-centric industries, the retirement of old workers often leaves behind holes that are hard to fill. Voluntary retirement often creates a paradox; high-skill and high-productivity workers are more likely to be rich enough to retire and therefore more likely to voluntarily retire, while their less-productive counterparts are more likely to stay working. When looking for work, older workers often prioritize flexible schedules, reduced workloads, or ergonomic workplaces, benefits that younger workers often want as well. Many older workers go it alone; contrary to stereotypes, the most entrepreneurial age group in the US is the 50-64 age bracket.

The biggest threat to old people’s well-being is health; healthcare spending is also the biggest threat against government finances. Many tech startups have tried to revolutionize healthcare from the outside and failed; the healthcare industry is hostile to anything that unduly increases data entry burdens for healthcare workers or undermines the central role of doctors. An increasing share of healthcare is occurring in less-medicalized settings such as retail store pharmacies; compliance and health outcomes are significantly better when patients are not intimidated. Healthcare spending is disproportionately concentrated into the last year of a person’s life. A majority of people say that they will decline further care once their health becomes irrecoverable and their lifestyle becomes unlivable, though this is often not what they decide when this choice actually comes to them.

It is unlikely the Baby Boomers will ever see the caregiver robots repeatedly promised in the past, but the potential of other developments such as the gig economy and smart home technology has barely yet been explored. Paid eldercare is currently a highly inefficient business stuck in the pre-digital age; it is ripe for disruption. Thanks to improving technology and a-la-carte eldercare, it should become less necessary for old people to check into full-featured nursing homes as a result of just one or two lifestyle impediments.

Much of the current cultural narrative of old age was written in a time when few people reached old age, their bodies were wrecked from a lifetime of hard labor, and they died quickly after. Economic reality has changed since then, but culture is still lagging behind. Some level of change to the narrative is inevitable; individuals and businesses that tailor themselves to the new reality stand to benefit at the expense of those who stick with the bland old script. The Baby Boomers will defy demographic doomsayers by living an old age that is more active, more independent, more socially integrated, and more economically productive than what the old narrative assumes. By the time today’s younger generations reach old age, they will have a much better playbook for how to succeed in this poorly-charted period of life.