## The Longevity Dividend

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**Canonical URL:** [The Longevity Dividend](https://www.imf.org/-/media/files/publications/fandd/article/2025/06/scott.pdf)

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### Overview
- The dominant narrative of demographic doom—shrinking populations, longer lifespans raising pension and eldercare costs, and fewer workers supporting more retirees—is "partly true" but incomplete.
- One in ten people worldwide are now over 65, and that proportion is projected to double over the next 50 years.
- In Europe, 90 percent of the increase in workers in the past decade—17 million more people in employment—came from a jump in workers over 50 (OECD). In Japan, the proportion is even higher.
- The authors argue for reframing aging as an opportunity: an aging, more experienced population can be essential to economic dynamism if policies focus on adaptation to longer lives rather than trying to preserve existing systems.

### Adapting to longevity
- Global life expectancy now exceeds 70, and is "even 80 in an increasing number of countries."
- If systems remain calibrated to 20th-century life expectancy, pension and health costs will rise and drag on economies, especially richer countries.
- Policies that attempt to change demographic composition (raising birth rates, immigration) do not address the deeper challenge of adjusting to longer lives; they merely delay fiscal pressures.
- The sustainable solution is investing in the human and social capital of later life and redesigning health, education, work, and financial systems to help individuals adapt to greater life expectancy.

### Expansion of morbidity
- The epidemiological transition shifted burden from infectious to chronic noncommunicable diseases (Omran 1971).
- Chronic noncommunicable diseases now account for 60 percent of the disease burden globally, and 81 percent in the European Union.
- Healthy life expectancy has not grown as fast as overall life expectancy, producing an expansion of morbidity—health systems risk keeping people alive without making them healthier for longer, at rising cost.
- Prevention and health maintenance should be prioritized over treatment alone. Three enabling factors:
  - Increased longevity makes chronic disease experience likely for most people.
  - Growing availability of structural risk and genetic data enables targeted interventions.
  - Advances in biology offer the prospect of more effective prevention; GLP-1 drugs (Ozempic, Wegovy) illustrate how one therapeutic class can postpone multiple diseases; geroscience, cancer therapies, synthetic biology, and genomics are promising areas.
- Increased investment in life sciences and biopharmaceuticals is necessary to develop cost-effective preventive therapies.

### Life-course approach
- To achieve healthy 90-year-olds, prevention must start in childhood and certainly no later than middle age.
- Measures of healthy life expectancy should be key metrics for allocating health expenditure rather than output measures based on treating disease and performing operations.
- Financing prevention requires additional spending; options include more government debt or innovative financing such as social impact bonds funded by future gains.
- Major innovations in health care, public health, and pharmaceuticals drove 20th-century gains; similar substantial investments are needed for 21st-century healthy longevity.
- Technological solutions:
  - Robotics can assist care where nurse/support staff shortages exist (example: Japan).
  - Digital innovation and artificial intelligence can personalize prevention if digital literacy is expanded across ages and social strata.
- Health outcomes are shaped by socioeconomic factors; multisectoral involvement (businesses, levels of government, communities, food and housing industries) is required.
- Policy examples supported by this perspective: taxing unhealthy foods, public health campaigns encouraging exercise and healthy living, and tackling inequality to enable fuller societal contributions.

### Boosting employment
- Labor force participation: nearly 90 percent of Europeans in their late 40s are in the labor force; participation falls below half by people's early 60s.
- Raising the state retirement age helps public finances but does little to help individuals continue working longer.
- Boosting employment for ages 50+ requires policies across health, skills, and job design to create age-friendly roles with more flexible hours, fewer physical demands, and greater autonomy.
- Health-related labor exits are consequential: someone diagnosed with cardiovascular disease at age 50 is 11 times more likely to leave employment in the United Kingdom.
- Preventive health policies have macroeconomic value: a 20 percent reduction in the incidence of six major chronic diseases increases GDP 1 percent within five years and 1.5 percent in ten years in the UK, driven by higher labor force participation; effects are most pronounced for workers ages 50 to 64 (Schindler and Scott, forthcoming).
- Many occupations (e.g., construction) remain difficult for older workers, highlighting the need for lifelong reskilling and transitions, plus anti-age-discrimination laws.
- Age-friendly jobs reduce competition between younger and older workers and increase the efficacy and fairness of raising the state retirement age.

### Policy recommendations and priorities
- Reframe aging as opportunity rather than problem; prioritize adaptation to longer lives.
- Shift health systems from treatment-focused to prevention and health maintenance across the life course.
- Make healthy life expectancy a central metric for health expenditure allocation.
- Increase investment in life sciences, biopharmaceuticals, geroscience, cancer therapies, synthetic biology, and genomics.
- Adopt innovative financing (for example, social impact bonds) to fund prevention today with future gains.
- Invest in robotics, digital innovation, and artificial intelligence for care delivery and personalized prevention, and expand digital literacy across ages and social strata.
- Implement multisectoral policies addressing socioeconomic determinants of health (taxes on unhealthy foods, public health campaigns, housing and food policy).
- Promote policies to boost employment for older workers: preventive health, reskilling, job redesign, flexible hours, anti-age-discrimination laws, and support transitions into less physically demanding occupations.

### Key statistics and figures (preserved exactly)
- "One in ten people worldwide are now over 65."
- The proportion over 65 "is projected to double over the next 50 years."
- "In Europe, 90 percent of the increase in workers in the past decade—17 million more people in employment—came from a jump in workers over 50."
- Chronic noncommunicable diseases account for "60 percent of the disease burden globally, and 81 percent in the European Union."
- "Global life expectancy now exceeding 70, and even 80 in an increasing number of countries."
- Someone diagnosed with cardiovascular disease at age 50 is "11 times more likely to leave employment in the United Kingdom."
- "A 20 percent reduction in the incidence of six major chronic diseases increases GDP 1 percent within five years and 1.5 percent in ten years" (evidence for the UK).

*Source: The Longevity Dividend — Andrew Scott and Peter Piot, F&D Special Report, June 2025.*

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_Source: https://www.imf.org/-/media/files/publications/fandd/article/2025/06/scott.pdf_