The most influential Megatrends set to shape the world through 2030, identified by Euromonitor International, help businesses better anticipate market developments and lead change for their industries.Learn More
One of the major success stories of the modern era has been the prolonging of human life. In the 20th century alone, thanks to crucial developments in medicine and healthcare, an extra 30 years of life were added to millions of peoples’ lives. As a result, the ageing of societies— characterised by rising life expectancies and falling fertility rates – is becoming progressively more evident across a spectrum of Finnish cities, which displayed some of the fastest rates of ageing across Europe. The effects of these changes will indubitably not go unnoticed, as a larger share of pension-aged people will bring together greater economic and urban challenges. At the same time, new business opportunities are arising for businesses seeking to exploit a new and growing consumer market of the elderly.
Source: Euromonitor International
Public finances (spending on education, health, policing etc) will be stretched in local areas as the growing dependency ratio (the ratio of the population under 15 and population over 65 as a proportion of people aged 15-64) will continue to rise across a broad range of Finnish cities. Healthcare spending will surge as declining state tax receipts (a consequence of a falling working age population) will likely impact state-funded health institutions, fostering a greater demand for private health coverage. Unsurprisingly, healthcare will be the most rapidly rising budget category in all Finish cities analysed by Euromonitor International over 2016-2021, related largely to the growth of the elderly population.
The increasing number of people going into retirement will place a greater strain on a dwindling working-age population. Declining labour force participation will act as a drain on businesses, suppressing investment and future economic growth. Being the country’s economic centre, Helsinkiwill likely maintain a healthy inflow of labour, although this may not be the case for smaller Finnishcities, such as Pori, Lahti and Tampere, among others, which will find it increasingly challenging to replace an ageing labour pool. The end result will be severe labour productivity drops, especially in the smaller cities of the country.
It is estimated that by 2050, globally, the over 65s will outnumber children under 15 for the first time in history. Indeed, the changing face of society will force Finnish cities to progressively adapt their urban structures to take into account the increasing age of its inhabitants. For example, older people are generally less likely to drive, making public transportation and walking the preferred mode of mobility. This will mean a greater number of public amenities being concentrated in and around locations that are best served by public transport.
Finnish cities can take inspiration from other developed cities that are making significant progress on ensuring that the elderly are not being left isolated in urban societies. For instance, the city of Berlin has vowed to become fully accessible by 2020 through making public footpaths wider, providing a longer window of time for people at road crossings and ensuring easier access to buses and trams. In Toyama, Japan, where over a quarter of the population is over 65, a compact city principle has been introduced that essentially concentrates all work and life activity within the city centre. It therefore prevents urban sprawl and ensures the vast majority of public and private services are easily accessible to the elderly through walking and/or public transportation.
A market is opening up for businesses keen on exploiting lucrative untapped opportunities in Finnish cities. Demand for private nursing and care centres will progressively rise, especially in cities such as Pori, Lahti and Kuopio, which have some of the highest proportions of over 65s in Finland. Companies specialising in consumer products tailored for the elderly, such as walking sticks, wheelchairs and crutches, will increasingly pop up. Meanwhile, a market for sport and leisure activities will also surface, which will include specialised gyms for the elderly, bingo centres and guided walking tours.