Emerging markets such as China and India will grow old before they grow rich

Emerging markets such as China and India, before they start celebrating stable fertility rates, will have to contend with ageing populations which don’t have enough savings to deal with old-age issues.

Also, those employers will prosper who offer workplace childcare, fertility and family benefits. Diversity and inclusion at the workplace will be driven by Gen Z which is the most diverse generation so far – 22% of this generation has at least one parent who is an immigrant. Gender pay gap, widening before Covid, if closed, can unlock economic benefits and push up global GDP by trillions of dollars. Gig economy is a disruptive innovation but not the panacea to the labour market.

These are some of the findings of a demographics primer prepared by Bank of America’s global research team.

Growing old

Emerging markets are growing old before growing rich. EMs are where ageing is happening fastest. By 2050, EMs will be home to almost 80% of the world’s population aged 65 and over, out of which more than 23% is due to China alone. Yet, only about 30% of workers in emerging markets are covered by any form of retirement income scheme. EMs face a pension savings shortfall of $106tr as their populations age, 3x their aggregate GDP.

Each worker has a pension gap savings gap of $40,000. Pension funding is even more challenging for these countries, as they lack developed welfare systems, generous state pensions and strong personal resources. Structural trends of a smaller labour force, lower interest rates, and deteriorating fiscal balances all threaten pension viability. The retirement savings gap highlights the necessity for personal finance backed by insurance protection.

The future of work

The future of work includes workplace childcare, fertility and family benefits. Employers supporting access to affordable and quality childcare will prosper as this ensures that children have access to early childhood education and that specific challenges faced by parents are addressed.

Fertility-related benefits, like as IVF and paid surrogacy, are becoming increasingly common in employee benefits packages. In the US, between 2019 and 2020, employers adding family-building benefits jumped by 500%, with some employers offering as much as $200,000 to cover the cost of family-building. Independent providers of fertility benefits management for employers would benefit from the fast-growing fertility market.


Several diversity, equity, and inclusion (DEI) factors already impact the global economy, related to race, gender, disabilities and more. Cultural and institutional bottlenecks and gaps exist within these societal groups. Unlocking them could yield considerable economic benefits and mitigate some of the challenges related to an ageing, reducing workforce.

It will take 267 years to reach gender parity in education and employment as of 2021, but flexible working practice, supportive employment laws can help.


The cost of not addressing these gaps is already high. Gender and racial biases lead to

labour market disparities and limit the economy. Poor DEI has cost $70tn since 1990: closing gender and race gaps would have generated $2.6tn more in economic output in 2019 and the cumulative gains from 1990 would have been c.$70tn.

While independent work or the gig economy is here to stay, it is not the panacea for labour market problems.

The gig economy is disrupting the traditional world of work. But workforce participation is expected to change, as some take to a hybrid style or even go out of work entirely. There will also be a structural change in the mode of participation, from the 9-to-5 routine to a freelance model (‘gigs’), and COVID has helped to accelerate this trend. Around 162 million, or 20-30% of the working-age population in the US and EU, are thought to be engaged in “independent” work.

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