A leading academic from the University of NSW has called for older people to remain longer in the workforce as a solution to the fiscal challenges of population ageing.
A senior research fellow at the ARC Centre of Excellence in Population Ageing Research, Rafal Chomik, says many older people already want to work longer, but encounter barriers to doing so.
"These barriers and incentives that lead to older people's inactivity come at a high cost of forgone potential," Chomik says. "We estimate this cost to be around $30 billion, or 2.4 per cent, of GDP [gross domestic product] in 2012."
Chomik cites the dependency ratio to back up his claims. This ratio measures the proportion of those of traditional retirement age (65 years and over) to those below it (15-64 years). In Australia, this dependency ratio has increased from 15 per cent in 1980 to 20 per cent in 2012. By 2050, it is expected to reach 36 per cent. "You can see from the figures that as working ages remain the same, dependency becomes much higher," he says.