The Hidden Economic Crisis in an Aged Society

  The Hidden Economic Crisis in an Aged Society

United Daily News Editorial (Taipei, Taiwan)

May 28, 2018

 Translation of an Excerpt

In February 1993, the population over 65 of age had climbed to occupy more than 7% in proportion to the total population, reaching the definition of an "aging society." Last March, the ratio climbed one more notch to 14%, the definition of an "aged society"; this step took twenty-five years. In the meantime, in conformity with the UN definition, the “elderly population” fully increased by 1.82 million to 2.31 million in total.

Let us imagine using the graphics of demographic structure: the ideal pyramid—with infant population as the base, and the elderly population at the apex, the society of this structure has a solid underpinning foundation, and may form the future stratum of the middle aged. Conversely, if the population is an inverted pyramid, it won’t be difficult to understand the fragility of its economic development. The demographic structure of Taiwan in the 1960s used to be a beautiful pyramid; now it is a pot shaped with a fat midsection and flat head and tail. According to demographic estimates of the National Development Council, if the situation remains unchanged, in another 25 years, Taiwan would be near an inverted pyramid.

The aged society is not unique to Taiwan; not a few developed countries have already crossed this threshold. However, the time it took for Taiwan to move from an aging society to an aged society, doubling the ratio of the elderly population, was similar to Japan but far quicker than in other countries. What is even more alarming is that we will reach the 20% "hyper-aged society" in as early as eight years; this is faster than Japan’s 11 years and Germany’s 36 years. Taiwan’s aged society has arrived vehemently and abruptly; the accompanying economic challenges have also arrived. There is not too much time for the government to slowly cope with it, but it must confront it as soon as possible.

Currently, government policies coping with the aged society are sprinkled among numerous areas; on the one hand, it needs to integrate resources, and fully implement policies to show results; on the other hand, it wants to inject more efforts on the issue of the declining percentage of the working age manpower, which is the root of the predicament for economic growth. When we encourage child birth, the effects will emerge fifteen years later; the mid- and short-term policies, however, should focus on the increase in the labor participation rate and the expansion of the social work force migration, including a job market friendly to women, postponing retirement age, recruiting professional technical manpower from abroad, and a new immigration policy; the study and pushing of all these should be accelerated.

Attachment : none