Sidney Taurel: Innovation energizes the age wave
In the US 100 years ago, about 4% of the population was older than age 65. Today it is about 13%. By 2030, it could exceed 20%. This age wave is a result of our increased longevity and the baby bust that followed the boomers.
This age wave will change everything. The dominant assumption is that the age shift is going to bring massive economic challenges, especially in the healthcare industry, where rigorous cost control is going to be the primary path to solutions. This is based on the conventional view of our future society, which expects the elderly to fit the traditional stereotype—failing physically, fading mentally and fearful of the future.
What this view misses is an adequate understanding of the role of biomedical innovation. Technology is changing the aging process, leading to a dramatic decline of disability among those over 65. It's as if we've opened the circle of life and inserted a new wedge in it, where people entering this new age are not turning into their grandparents. Instead, they are turning out to be simply more experienced versions of themselves in middle age. Healthier lifestyle choices are part of the story, but primarily this is medicine at work. In short, all evidence suggests that the new senior will be characterized by energy.
This matters significantly because that energy, that larger health span created by decades of medical innovation, may well turn out to be the most precious natural resource we have. Since the baby bust has reduced the number of young people coming into the workforce, we might well need to think about creative ways to entice the wave of baby boom retirees back to work. The contributions of these super seniors could mean the difference between a future of economic decline and one of continued vitality, as we find new ways to tap into their experience and energy in the workforce.
This age wave also will act as an incredible driver of creative destruction, making many familiar products and services obsolete and others, some not yet imagined, needed and desired. It will thus provide a tremendous stimulus to innovation, renewal and economic growth. It's hard to imagine an economic sector that will not feel the irresistible need to change and thereby to grow.
The sector that's likely to emerge as the strongest driver of growth in our economy will be those industries near the center of the biomedical revolution—pharmaceuticals, diagnostics, imaging, medical devices, surgical practices—which are evolving rapidly to more effectively predict, prevent, treat and cure diseases. The message from the age wave is that these goods and services are what society will need and want most in the future.
As they plan for the future of aging, our leaders need to be aware of the benefits as well as costs of investing in the health of the elderly. Whatever they do, they need to avoid any policy that might have the unintended consequence of shutting down investments in new medical technologies. Such a course would chain us to the past and forfeit a brighter future.
With a more balanced perspective, many would conclude with me that, yes, the age wave may represent the end of the world as we know it.
But at the same time, it may just be the beginning of a better world than we have ever known before.
Sidney Taurel is chairman and CEO of Eli Lilly