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　　Main Impacts of an Ageing Population

　　雅思作文

　　One of the great achievements of the twentieth century is a dramatic rise in life expectancy. For examples, life expectancy in the US has increased from 45 in 1902 to 75.7 in 2004 . However, increased life expectancy combined with declining birth rates have caused many to worry about the cost of an ageing population. Frequently, we hear about ‘demographic time bombs’ and the fear future generations will struggle to meet an ever increasing number of retired workers and pension commitments.

　　Increase in the dependency ratio

　　Increased government spending on health care and pensions. Also, those in retirement tend to pay lower income taxes because they are not working. This combination of higher spending commitments and lower tax revenue is a source of concern for Western governments - especially those with existing debt issues and unfunded pension schemes.

　　Those in work may have to pay higher taxes. This could create disincentives to work and disincentives for firms to invest, therefore there could be a fall in productivity and growth.

　　Shortage of workers. An ageing population could lead to a shortage of workers and hence push up wages causing wage inflation. Alternatively, firms may have to respond by encouraging more people to enter the workforce, through offering flexible working practices.

　　Changing sectors within the economy. An increase in the numbers of retired people will create a bigger market for goods and services linked to older people .

　　Higher savings for pensions may reduce capital investment. If society is putting a higher % of income into pension funds, it could reduce the amount of savings available for more productive investment, leading to lower rates of economic growth.