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Worldwide | worldwide | 2010-01-11 Demographic change The role of technological innovations Bildquelle: fotolia.com Demographic change is one of the major challenges facing not only many of the world’s developed economies. Its impact on business and society is likely to hinge on our ability to manage the demographic transition in an active and forward-looking manner. Technological innovations are one possible solution. They have been given little consideration so far, but are likely to be of major significance.
Demographic change and the related challenges have become an integral part of political debate in Germany. However, there is rarely any talk about future technological developments being a way to address the issue. The development of such technologies could help to counter the prospective slowing of productivity growth in connection with the ageing of the workforce. One major problem brewing because of the demographic shift is a shortage of labour. Already today, for example, there are not enough care staff in Switzerland to look after that country’s pensioners. In some regions of Japan, pensioners even constitute the majority of the population. Traditional approaches to overcoming a shortage of labour – such as increasing migration, the retirement age or the birth rate – will reduce the scarcity only to a limited degree or with a considerable time lag. Often, migration can only be one part of a comprehensive solution because there is a generally low willingness to embrace integration and integration capacities are limited. Many nations have so far failed to find any way to effectively boost their birth rate. True, a higher retirement age provides effective leverage and its advent is almost inevitable given a steady increase in life expectancy. As the labour productivity of older workers tends to trend down, however, this alone will also not suffice. Productivity-enhancing technological innovations could become an important component of the overall solution. Future generations of robots or assistance systems, for instance, could support human mobility by minimising the amount of muscle power required. Heavy or recurring physical burdens, as borne by workers in the construction industry or care sector, could thus be avoided and existing physical disabilities could be mitigated. Those employed at PC workstations could have their work routines and breaks designed with the help of optical and biometric sensors in ways that boost efficiency and reduce phases of poor concentration. Such productivity-boosting technologies would not only be available to older employees but also to the entire labour pool. This is the case in the services sector in particular, where the use of such technologies is still in its infancy. First, though, the technological complexities of interaction between man and machine as well as issues on the ethical compatibility of new technologies have to be resolved. The commercial incentives to find answers to such research-intensive issues in the coming years, or decades at least, are huge nonetheless. Some nations, such as the technophile Japanese and the highly innovative Swiss, have recognised the potential for innovation and are attempting to increase their competitive lead by means of targeted innovation policies. Their efforts are significant from both a socio-political and an economic point of view, for the “silver economy” (the 50-plus cohort) is increasingly gaining importance as a consumer group with considerable purchasing power. Most European countries are more hesitant about using technological applications. Germany, for instance, may be highly innovative in relevant areas of robotics; however, the demographic challenge has so far not been a relevant driver of research activities. The federal government has also made virtually no direct reference to demographic change in its comprehensive High-Tech Strategy for Germany. It is surprising that such a key topic has been neglected since strategic initiatives have already been launched at EU level as part of the EU’s Seventh Framework Programme for Research and Technological Development. One example is the AALIANCE programme on the promotion of research in the area of Ambient Assisted Living. Greater incorporation of this issue into national innovation policy would enable German companies to derive greater benefits from their reputational strengths and existing know-how. Products “Made in Germany” are synonymous with quality and reliability. Assuming that new technologies will in future have a substantial influence on the quality of life and on the everyday lives of older people in particular, these characteristics should play a key role in purchasing decisions. Many technologies which may be able to counteract the demographically induced problems also combine mechanics and systems technology. Germany is home to established companies and research institutes in both areas. Using targeted programmes, the federal government ought to create appropriate framework conditions. In this way, it would not only be possible to reduce the demographic shift’s negative socio-political consequences, but competitive advantages and jobs could be created as well. Given the high economic costs entailed by the ageing of society the German government should integrate the related technological developments as core issues in political programmes and above all in its High-Tech Strategy. For without early, targeted action, other countries will not only manage to cope with the demographic change more efficiently, but they will also build up competitive advantages in the silver economy. Moreover, the health and long-term care sectors will require political support in order to familiarise people with new technologies and gain their acceptance. There is no doubt that all these measures involve sizeable expense; however, the potential savings should more than offset the costs.
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