By 2080, people aged 65 or older are projected to outnumber children under 18 worldwide, yet society is largely unprepared for this demographic shift, according to a World Economic Forum (WEF) report.

Developed in collaboration with Mercer and over 50 public and private sector organisations, the report highlights key trends and solutions to help societies navigate this transformation.

"The UN projects that by 2080, individuals aged 65 or older will outnumber children under 18, marking a fundamental demographic shift. But there are ways to prepare and improve people's financial resilience," claimed WEF longevity economy lead, Haleh Nazeri.

"The innovations exist – now it is about scaling and adapting new approaches in critical areas like decumulation, investing and long-term care to help create a more equitable and inclusive system," she said.

The report proposed 10 actions to prepare societies for the impact of demographic transitions, including modernising retirement and social security systems to support longer lives and evolving career paths, expanding access to financial products and protection for gig and informal workers, and encouraging auto-enrolment and behavioural nudges to increase retirement savings participation.

The report also emphasised that innovative ideas, cross-sector collaboration and a fundamental shift in perspective were essential to transforming this demographic transition into a driver of economic growth.

"People living longer is a sign of progress in our society, but it comes with challenges in areas like health care and access, retirement, and workforce," said Mercer president and CEO, Pat Tomlinson.

"By investing in innovative financial models and employee benefits as well as supporting life-long skill building, we can help shape a future in which people can thrive at any age and businesses and economies remain resilient to changing demographics."

"There is significant room for improvement in these areas,” adds APG strategic policy officer, Ruben Laros.

“Take, for example, the development of a resilient pension system. The Netherlands is leading the way with its pension reform. Because of this, other countries that have not yet made such progress are closely observing us," Laros suggested.

“The major advantage of the pension system reform in the Netherlands is that while pensions become more individualized, the benefits of collectivity and joint investments remain intact, continued APG AM head of product management, Alwin Oerlemans.

"Social partners still take responsibility for company-wide or sector-wide agreements, and mandatory participation ensures universal inclusion.

"Moreover, the Dutch pension contract reform is transitioning from a hybrid defined benefit-like (DB) structure to a hybrid defined contribution-like (DC) structure,” he said.

“With a different mix of collective and individual elements and retained risk-sharing, this approach aligns well with the longevity economy. As the Netherlands is doing, modernising the pension system ensures sustainable security for ageing populations."

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