Revving Up the Economy: The Impact of Older Adults

Today – with advances in health care – we are living longer, healthier, and more fulfilling lives than previous generations. Just 100 years ago, the average life expectancy was around 61 years; now it’s nearly 78! The United States is in the midst of what is often called a “silver tsunami,” with 10,000 people turning 75 every day.

Older adults – the wealthiest age cohort in the world, by the way – earn wages, spend money, generate tax revenue, support social causes, and create demand for goods and services that stimulate job growth. They also represent a large chunk of unpaid activities like caregiving.

In fact, if Americans 50 and older were counted as their own country, they’d constitute the world’s third-largest economy. That’s from a 2019 AARP study that also found that this group’s economic impact will triple by the year 2050, increasing spending from $8.7 trillion in 2020 to a projected $15 trillion in 2030.

The AARP study, called the Longevity Economy Outlook, examined national data on how much people age 50 and older spend, earn, and pay in taxes. From that information, the organization projected the profound impact older adults have on the economy, with four key findings:

People over the age of 50 are a growing economic engine. Currently numbering 117 million, they will expand to 157 million by 2050. They drive economic growth, innovation, and new value creation.  

Not all value is generated through paid work. The older adult demographic contributes $745 billion worth of unpaid activities and comprises an “invisible workforce.” This includes caregiving, volunteer, and service activities.

Seniors’ spending and labor support millions of jobs. In 2018, those 50 and older comprised 44 percent of total employment, and their spending and labor supported 88.6 million jobs.

In addition, 25 percent of all new entrepreneurs in 2018 were between the ages of 55 and 64, up from 15 percent just 20 years earlier.

The market needs to catch up with this group. As of April 2021, U.S. households headed by people 55 or older held 69 percent of the country’s total wealth, but only 5 percent of advertising is focused on them. This is a missed opportunity.

It’s time to reframe the conversation. Instead of a drain of retirees, we actually have a dynamic, experienced workforce. And instead of expensive costs, we have an exploding consumer market that is bolstering our economy.

Our entire life should be a time of continued growth and vibrancy. Instead of shunning our older years, let’s embrace them and transform our society into one where everyone can age successfully.

Patti Lyons is president of Senior Citizens, Inc., a nonprofit organization in Savannah and coastal Georgia that has been helping people age successfully since 1959. She serves as the chair on the Meals on Wheels America Board and is a governor’s appointee to the Georgia Council on Aging. Learn more at www.seniorcitizensinc.org.

This article originally appeared in the May 2022 issue of Ardsley Living.