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Disruptive Demographics

Joe Coughlin, director of MIT AgeLab, discusses the future of healthcare and aging.

Joe Coughlin | MIT AgeLab

Humorist and social commentator Andy Rooney once said: “… the idea of living a long life appeals to everyone, but the idea of getting old doesn’t appeal to anyone.” Today, it’s not just individuals who hear the ticking of the biological clock. It’s entire nations. In ways unseen in history, the graying of humanity is already having a profound impact on everything from marketing to innovation to housing to healthcare.

The following was condensed from Dr. Joe Coughlin’s recent address at UPS headquarters in Atlanta, where he spoke as part of the company’s Leadership Speaker Series.

You use the term disruptive demographics. How does that relate to aging, and how should it alter our thinking?

There are more people in the world entering their later years than at any time in history. And they aren’t being replaced.

The United States is the only country in the industrialized world where the population is kind of growing, depending on whose numbers you look at, largely due to immigration and a relatively high fertility rate.

Europe, for all intents and purposes today, has more walkers and wheelchairs than it has baby carriages.

Russia, as a nation, is going away. Life expectancy there for men has dropped into the high 50s due to AIDS, traffic accidents, alcoholism and lots of other things going on.

Even in South America, they are very soon going to have the same demographic profile on the whole as North America. In certain pockets like Sao Paulo and other places, they have much the same demographic profile as Europe.

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People are getting older and living longer. But they’re also living differently — and better.

In China, the one family-one child policy has worked too well. They’re losing population and – who could have seen this coming? – they are facing a labor shortage.

Japan is selling more adult diapers than baby diapers. Sorry about that. But I’m told that’s an image that sticks with people.

There are a lot of threats in these numbers. The employee base we depend on may not be there. The markets we count on may not be there. The allies we’ve had for decades may not be there. Humanity has simply never seen anything like this. There is no manual for this.

Second, it’s not just that we’re getting older. It’s that more people are being older longer. There is some good science that says we’re going to be living to 100. Some say 120. Some say even longer.

So the disruptive demographics of advancing age is really a combination of things. It’s more people getting older and living longer. But they’re also living differently and living better. It’s a demand for new kinds of support and services that center on quality of life. People don’t just want to live longer; they also want to live well.

In the U.S., the baby boomers reshaped everything at every life stage they hit. Will they do the same to aging?

Definitely. We’re not going to age politely like our parents. They accepted that age is about loss. They accepted that they would lose some capabilities, have less money, have fewer experiences.

We’re not going to sit on the front porch waiting for someone to visit. We’re not going to accept that our stiff fingers can’t open a bottle. “Oh well, we’re old. That’s the way it goes.”

The aging population today is saying: “Just because I’m older, and just because my health might not be what it once was, that does not mean that I can’t live like I want to, or do the things that I want to.”

They won’t just be an older consumer. They’ll be a consumer that expects more. They’ve been around. They are used to getting what they want, and they know how to get it.

That difference between what our parents accepted and what we accept is the new innovation gap.

Business and governments are both going to see demand and opportunity in filling that gap with new services, products and policies.

You’ve mentioned disruptive demographics meeting disruptive technologies. How will that fusion play out?

Technology is going to help deliver on the expectations of an aging population. Their health is the best example. One hundred and thirty million Americans have one chronic condition – like hypertension, diabetes and asthma.

Baby Boomers’ disease of choice is hypertension and diabetes coming together to form something ugly called metabolic X. Sixty million Americans have two diseases. Thirty million have five conditions.

So the question is not: “Am I going to get sick?” I am. The issue is, can I manage those conditions well enough so I can do all those things we call life: walking the dog, visiting grandkids, volunteering. For many, it’s “Can I keep working?” According to AARP, 70 percent of boomers want to keep working, and 40 percent say they plan to work until they drop.

Information technology will dramatically change the possibilities. It won’t just be something we carry or even wear. It’s going to be inside us. Human beings will be part of the Internet of Things – sensors will monitor us, and let the right people know when something goes wrong.

It will create a whole new range of services that we have yet to even envision.

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The question is not: “Am I going to get sick?” It’s, “Can I manage those conditions so I can do those things we call life?” 

Care will be personal. The focus won’t be on just fixing what is wrong. It’s increasingly on how well we chose our parents – what might be wrong in our future based on what went wrong in their past.

Healthcare will be everywhere – not just in the clinic, in the hospital, or in the emergency room. It will be integrated into our everyday lives.

It will be in our kitchens our bedrooms, our cars and our bathrooms. Our devices will talk to each other, to us, and to the providers of care.

For marketers, this sounds like a very interesting crowd. But also a very tough one. How do we reach them?

That’s an important question that tends to be overlooked in all the excitement about Millennials.

In the United States at least, 70 percent of the nation’s disposable income is in the hands of the 50-plus. This is a new market. This is a new opportunity.

As we refine new life-easing devices – including robots – as we develop new health systems, as we develop new delivery systems, this is the new business of old age.

It won’t be an easy business. Their expectations are very high. But their trust is very low. And it’s dropping.

The younger generations today have lower levels of trust at their age than the Baby Boomers did. But, remember the people who said trust no one over 30? Well, they passed 30 a long time ago, and now they trust no one.

In the early ‘60s, Americans’ trust in other people was quite high – around 60-something percent. It has dropped down into the 20s. In Europe and Asia, it’s far, far lower.

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 Healthcare will be everywhere – not just in the clinic, hospital or emergency room, [but] will be integrated into our everyday lives.

So as a result, we’ve got a real challenge all along the demographic spectrum. Who are you going to buy a product from? Who are you going to trust to knock on your door?

At the older end of the trust spectrum, we have the most educated generation in history. Education doesn’t make you smart. But it does give you chronic attitude. When you look at previous generations – even though they did great things – you could describe them as humble.

With the Boomer generation, 64 percent of us over 45 believe we have a higher-than-average IQ.

Seventy-five percent of us have great confidence in ourselves. Humble has never been a word that applies.

To reach a generation with resources and attitude, companies have to understand that it’s not about how good a company you are, how smart you are, what your expertise is.

It’s a whole different set of questions. Are you leaving me better? Are you leaving me more independent, more engaged and a smarter consumer overall?

To make their choices, are older people using information technology in the same ways as Millennials – the so-called “digital natives” – who grew up learning the Web the way their generation learned their ABCs?

Yes. They’re catching up. We used to talk about the digital divide. That has largely gone away. Forty percent of people over 65 are on social media. I didn’t say the Internet. That’s old news. I mean they’re using social media to connect and find information.

The fastest growing segment on the Web is women over 45. They’re not sharing pictures of their kids or grandkids. They’re doing research on their health, their finances, big purchases – whatever.

In general, we make three visits to the doctor a year. But we’ll spend 52 hours a year researching health care. Interestingly, it’s mainly women. And it’s likely they’re not doing it for themselves. They‘re doing it for somebody else.

One of the reasons that trust has become so important is that there is so much information available. Go into a Whole Foods to get an apple, and you come out knowing more about those apples than you do your spouse – where they were picked, how they were sprayed, labor practices, sustainability.

The amount of information – which should be a benefit – is actually becoming a negative in the effort to lead healthier lives. That is because so much of that information is contradictory.

There was a recent study – it got a lot of play in the news – that apparently salt may not have an impact on our blood pressure after all.

Remember when cholesterol was bad? Another study says that maybe the butter and the cream and everything else we cut out of your diet doesn’t affect it.

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We make three visits to the doctor a year — but spend 52 hours a year researching health care.

As things have gotten more complex and contradictory, we’re saying, “You know something? I can’t trust these institutions. I can’t trust expertise. As I age, I’ve got to be as smart as I can.”

We probably still don’t realize is how fast this pace of change is, how fast the different generations are really coming together to where technology is the great unifier. There’s nobody I’ve ever met who is fearful of it. The smallest kid to the oldest person I’ve dealt with … they all love technology.

But it has to be simple. That’s the key to adoption. It’s really easy to make complex technology.

The essence of what Apple’s all about is making technology simple, whether it’s for our customers or whether it’s for us at work or us in our home lives outside of work. When it’s good and it’s simple, you don’t have to worry about adoption. It goes really fast.

So where do they turn? Once they’ve mastered the digits, are they on their own?

No. Just the opposite. Technology is a connector in ways the world has never seen.

Who is the most trusted source of information? Oprah? No. Bald-headed geeks like me from MIT? No. It’s each other.

It’s other people who have had the same experience with treating a condition, buying a car. And we’re getting that advice on social media. Go on Angie’s List, and our friends and neighbors are there with advice on everything from a plumber to a brain surgeon.

Back to health care. We talk about focusing in on the doctor-patient relationship. Well, we don’t see the doctor as often as we once did, and the doctor is actually in many cases a minor player. It’s my social network online, my family, my friends, the people that actually influences my behavior.

Final question. Even though they live more active lives, so many people moving into their high-care-need years are going to generate a huge bill. How are we going to pay for all this?

Right now, there is not a good answer for that. When we talk about the support ratio – the number of workers versus the number of elderly that need support – it’s clear we’re facing an incredible challenge.

That’s especially true for nations that are not growing. Europe has an especially big problem because of the social contracts with pensions, healthcare and the like.

The only answers I can come up with right now are rather weak.

One will be difficult to swallow. You may have national insurance or private insurance to pay for what you need. The stuff you want may have to become a new category of discretionary income. The new market to think about is the adult child who provides it.

Second – an aging society should not be looked at purely as a cost. As I said earlier, 70 percent of the nation’s disposable income is in the hands of the 50-plus. They consume differently than generations before them. They’re staying healthy longer.

So along with the challenge, again, there is also great opportunity in the business of old age. goldbrown2

 

pain in the chainUPS recently launched it’s Seventh Annual Pain in the (Supply) Chain Survey, which takes a deep dive into the untapped opportunities in the healthcare industry. Click the image to access the full report.

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Joe Coughlin is Director of the MIT AgeLab within MIT’s Center for Transportation & Logistics. He is a global expert on how changing demographics and technology affect behavior and business innovation. Fast Company Magazine called Coughlin one of the 100 Most Creative in Business and the Wall Street Journal said he is one of the 12 people changing how we think about retirement. He can be found on Twitter @josephcoughlin

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