MSG Team's other articles

12943 HRIS: An Evaluation of its Cost and Benefits

Human Resource Information System (HRIS) often described as Human Resource Management System, in the present scenario can serve as a crucial tool in providing a competitive advantage to the organizations. It involves measurability, better management of data and information, equally provide scope for measurement of key HR practices and its outcomes on employee productivity as […]

12743 China’s Crackdown on the Gaming Industry

China has surprised the global gaming community by starting a full-fledged crackdown on the gaming industry. The Chinese government has not been the first one to try and restrict online gaming. For instance, in 2011, the government of Korea created a regulation which prohibited minors under the age of 16 from playing online games between […]

11774 Viking Economics

The Vikings were some of the most brutal people that the world has ever seen. The nations that they built were carved out of violence. However, their descendants have turned out to be the most caring and civilized people on the planet. Today, the Scandinavian way of life is a role model for the rest […]

11288 Situations Warranting Business Process Improvement

Business Process Improvement programs when designed with specific objectives and sponsored and facilitated by the senior management including Business Unit heads yields the desired results. Organizations use BPI as a tool to raise the bar and take their business operations to another level. BPI as a tool for effecting change management is effective especially when […]

8980 Disaster Recovery and Business Continuity – Planning Phase

Disaster Recovery and Business Continuity plans if well planned and implemented can help mitigate risks and loss to the business. With increasing competition and complexity of systems and reliance on IT technology, Organizations are focusing in this area to ensure they do not lose out on the business operations in the event of any disaster […]

Search with tags

  • No tags available.

Shock of Gray

The term shock of gray refers to the phenomenon of the western societies having older people as a percentage of the total population than the younger people. in other words, the shock experienced by having more retirees and those over 70 years of age and the graying of the population are expected to impact western countries drastically as far as caring for them and providing sustenance is concerned.

For instance, not only do the governments of the western countries have to ramp up on the Medicare expenditure they would also need to provide the necessary infrastructure to ensure that these elderly citizens are looked after properly. The longer-term care would also mean that hospice services, day care services, and old age homes have to be built for these people. After all, they have contributed to society in their prime and therefore, it is the duty of the governments to care for them in the autumn of their lives. As we shall discuss in detail in subsequent sections, the graying of the population entails severe adjustments by the governments of the west.

Rise in Medical Expenditures and Governmental Support

As mentioned earlier, the US, UK, and Europe have to significantly increased their healthcare expenditure to cater to the senior citizens and the elderly. This means that the existing healthcare systems have to be ramped up to cater to the elderly and this includes provision of medical personnel, paramedical personnel, and nursing assistants and domestic helps to the senior citizens.

The United States has to also increase its budgetary allocation for Medicare and Medicaid, the two programs that are part of the social security net in the country to take care of the elderly. These entitlements would drain a lot of money and this is where the government has to do a balancing act between caring for the elderly and budgeting for the expenditure in a manner that does not leave out the present and future generations.

Further, the UK has to fund its NHS or National Health Service to bear the load that is expected with so many senior citizens. This imposes additional burden on the already overworked NHS staff and this represents a major challenge for the British. Apart from these aspects, the UK and the US would also have to contend with rising medical costs and as these countries include the elderly in their social security net, they have to plan for the ageing population accordingly.

How Ageing Societies impact the Economy

Ageing societies affect the economies of the west in ways other than budgeting for healthcare costs. For instance, the fact that many Baby Boomers or those born in the immediate aftermath of the Second World War are retiring now and this means that companies, corporations, and the US government have to contend with the double whammy of rising healthcare costs and declining contributions from these retirees to the economy.

The companies have to payout the pensions and the lifetime healthcare insurance policies as well as pay them their 401(k) benefits that are part of the defined benefits and defined contributions aspect.

Further, ageing societies also mean that the present generation has to work harder to make up for the lack of the retirees contributions.

However, this is a blessing in disguise, as the current generation will have the option of choosing from more jobs that are available because of the retirement of the boomers. Of course, it is a fact that many Baby Boomers are putting off retirement as the current global economic crisis has made life tough for everyone.

The point here is that the ageing of the western societies has several implications for the economies of the west in terms of conflicting and intersecting trends.

Article Written by

MSG Team

An insightful writer passionate about sharing expertise, trends, and tips, dedicated to inspiring and informing readers through engaging and thoughtful content.

Leave a reply

Your email address will not be published. Required fields are marked *

Related Articles