LIAM BUTLER asks retiring Metlifecare chief executive Alan Edwards, what are some of the trends and challenges you identify for our aged care and retirement sector?
Alan Edwards: The ageing of populations in first world countries is well and truly old news and should come as no surprise to anyone. The question is; how are we going to respond to and deal with this incidence. Here in New Zealand, over the next twenty years the number of people 90 years and older will increase from 31,700 to 81,900 – an increase of 157%. In the meantime, the number of 65 year olds will grow from 745,000 to 1,248,000. Amid these very significant changes, our workforce only increases by 17%. To put that into perspective, right now there are 3.4 people in the workforce for every 1 person over the age of 65. Over the next twenty years this changes to 2.2 people in the workforce for every person over 65.
With people living longer, catering for age related illnesses will be challenging. The accelerated growth of people over 65 and an acceleration of those who develop cognitive impairment will place huge challenges on society as a whole. Access to suitable care environments will be testing, as will be funding and capital.
In addition to these demographic changes, we will see a strong generational shift. The “Silent Generation” (1924 – 1946) is being replaced by the “Boomers” (1946 – 1964). This generation has no intention to actually retire, instead they are constantly seeking to reinvent themselves, they see fun as a priority, want to live life on their own terms, are accustomed to buying services and insist on quality because, in the main, they can afford it.
So, aside from the demography, the growing number of cognitively impaired, the generational shift, government funding and continued access to capital, there remains a question around the next generation’s choices for living environments. The boom of suburban living in the 60’s through to the 90’s is slowly being replaced by more integrated communities. I am a boomer and I for one would want a much more connected lifestyle. Dislocation from other generations is not something I would cherish. There may be more like me. We may seek environments that are more integrational. These shifts may only appear in twenty to thirty years from now. The question is how we plan to meet these changing needs.
The retirement and aged care sectors are full of wonderful growth opportunities, these do however come with a set of challenges which are yet to fully materialise and will demand shifts from current practices, models, funding and operational environments. The industry is known for its long dated decision framework, the time to start meeting these future needs is now.