The Business of Ageing


Judith Davey

The Ministry of Social Development has published three reports entitled “The Business of Ageing: Realising the Economic Potential of Older People in New Zealand” in 2011, 2013 and 2015. Recently a 2017 update has appeared. These reports highlight  the positive side of ageing, or at least the economic contribution which older people can make. This comes in the form of workforce participation, tax-paying, acting as consumers and doing unpaid work.

The series of reports has tracked the growing economic contribution of New Zealanders aged 65 plus. It aims to influence the business sector to adapt to the ageing workforce, accommodation older people in or wishing to re-enter paid work, and to recognise the opportunities offered by a growing older consumer group.

Measurement is not easy in these areas, especially when attempting to make projections into the future and there is considerable uncertainty about the accuracy of the projections in their detail. Modelling uses Treasury’s Long Term Fiscal Model and progressive updates of Demographic and Labour Force Projections by Statistics NZ. In order to make comparisons over time, monetary values have been rebased to 2016 dollars. Technical details are available at the Ministry of Social Development’s Business of Ageing Website.

Results – Older people in the workforce

At present around 52 percent of men between the ages of 65 and 69 participate in the Labour Force and 62 percent of this group are likely to be in paid work, not necessarily full-time, by 2061. The comparable figures for women are 36 percent at present and 48 percent by 2061. By mid-century, nine percent of males over 80 and five percent of women over 80 are also likely to be working. This suggests some catch-up in female participation rates, bringing them closer to those for men.

The overall participation rate for people 65 plus is projected to rise slightly from around 24 percent (current) to around 25 percent by 2051-2061. This is a slowing down of the recent rate of increase, reflecting the movement of the “baby-boom bulge” through the population.

Value of paid and unpaid work

According to this set of projections, wage and salary earnings by older people are likely to rise from around $4.8 billion in 2016 to around $22.8 billion in 2061, a nearly 400% rise in 2016 dollars.

Remuneration from self-employment by older people is similarly likely to rise from around $1.7 billion in 2016 to around $8.1 billion in 2061, also nearly 400% up.

Income Tax paid by older people on remunerated work is projected to rise from around $1.0 billion in 2016 to around $4.6 billion in 2061. This does not take into account, however, tax on sources of income other than earnings, such as interest from bank deposits, other investments and government transfers (including NZ superannuation and GST).

The total value of all tax paid by older people is projected to rise from around $5.5 billion in 2016 to $25.1 billion in 2061,also getting on for 400%.

The value of the unpaid work is harder to assess, but a proxy value of $16.50 an hour was assumed (equal to the “carer’s wage). This showed an equally impressive rise from $11 billion at present to $47.5 billion in 2061. These figures suggest that the value of unpaid work done by older people exceeds the combined value of wages and salaries and income from self-employment, and that this difference will increase. The question arises, of course, of whether increased paid employment will result in a decrease in voluntary and caring work by older people.


The total value of expenditure by older people [inclusive of GST] is projected to rise from around $20.7 billion per year in 2016 to around $94 billion per year in 2061. This increase exceeds the total projected for tax paid.

On current patterns of expenditure, some 28 percent of this sum is expected to be spent on foodstuffs, alcohol and tobacco, clothing and footwear, and a further 22 percent on housing and housing related items. Health (11%), transport (13%) and recreation and culture (11%) constitute other important market segments.

We have already seen goods and services directed at older people beginning to be developed in the private sector. They include companion drivers (Driving Miss Daisy), personal services (Elder Care Matters) food delivery and assistive technology. Firms offering Super Gold Card discounts provide further examples. There are plenty of other opportunities for the forward-looking entrepreneur.

The same can be said for forward-looking employers, in the face of skills shortages. Rather than seeing an ageing population as a burden or a crisis, it can be the basis for economic enterprise. There is a role for government to ensure that barriers to such development are tackled and overcome.

About Age Concern New Zealand 'on research'

At the heart of everything Age Concern does is a passion to see older people experience well-being, respect, dignity, and to be included and valued. We support, inform and advise older people on issues such as access to health care, transport, housing, financial entitlements, and social opportunities. We also work to combat real problems in our society, like elder abuse and neglect, chronic loneliness and social isolation. We provide specialist services with trained and qualified professionals able to give expert advice and assistance. Age Concern is a charity and relies on the support of volunteers and public donations to do much of the work we do. To help us help older people, please consider making a donation of your time or money. To see how, visit
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