We are living longer and longer and Europe is aging rapidly: in 2003 18% of the EU population (and 21% of the Italian polulation) was over 65 years old. In 2050 the EU average will reach 28% whereas 30% of the Italian population will be older than 65 (EU Ageing Report, 2015).
The challenges of the Silver Economy
The demographic change has an impact – for better or for worse – on all economic sectors: transports, food, insurance, residential, health, safety, communication, internet, leisure.
The Silver Economy is becoming a highly relevant topic with a distinction between “third age” and “fourth age”. La third age is the phase (over 50) where the person is fully active with high quality of life expectations. The fourth age, on the other hand, is the following phase, which tends to get longer and longer, where fragility takes over and the need for assistance increases in order to be able to continue living in one’s own environment for as long as possible, avoiding expensive hospitalizations.
The opportunities of digital transformation
The personal care, welfare and assistance services industry (public and private) in Italy is worth € 290 billion, or 9.4% of the total national production: it is the second industry after commerce, surpassing other industries such as construction and transports. This is the result of a Censis-Unipol report.
The industry is also important from an employment point of view, providing jobs for 3.8 million people – 16.5% of the working population in Italy. Some estimates show that Europe operates at 12% of its digital potential and Italy at even less, only 10% (McKinsey Global Institute).
Considering the importance of welfare in the current economy and the expected growth due to the ongoing demographic transformation, it seems crucial to find ways to innovate and digitize these industries in order to reduce public spending and make living environments (homes and neighborhoods) more comfortable, connected and safe.
How? For example, by introducing solutions such as remote health monitoring (vital parameters, early warning, medication compliance, medical consultations), domestic risk monitoring (fire, gas, flooding), physical security (intrusion, access control), social relations (family, friends, caregivers) and living comfort (air conditioning, lighting).
Who would benefit?
Technologies and solutions that can support independent living of elderly people exist, but they are not widely used yet: therefore they are difficult to identify, select and implement.
Nevertheless, there would be benefits for all:
- For the person – Living independently in your own home as long as possible is the desire of most people and their families. Solutions that facilitate everyday life and allow you to stay connected with your family members (or other caregivers) could provide the serenity and safety.
- For companies– According to Merrill Lynch, the silver economy is the third largest industry in the world, considering the combined volume of private consumption and public spending. Due to the demographic development this market will continue to grow, driven by new needs and therefore necessary product and service innovation.
- For Public Administrations – The Silver Economy represents 25% of GDP and 50% of public expenditure in Europe, with an increasing trend due to the aging population (Growing the EU Silver Economy).
- For young people– There is a need to increase job opportunities for young people, possibly at local level. For them, the digital transformation represents a great opportunity, as they have the digital skills necessary to design, integrate and support these new solutions.
- For investors – In the current financial markets, banks and investors are looking for tangible (real economy) investment opportunities characterized by lower risks and greater growth margins. The silver economy is certainly one of these: a market with strongly felt consumer needs, and consumers willing to use their savings to improve their own living environment.
The potential advantages of silver economy digitization are evident and there are many different stakeholders – in addition to the elderly – who can benefit. But realizing this vision, so that new solutions and services can reach the elderly and adapt easily to his/her changing needs, requires new business models, partnerships and financial support systems.
The new technological solutions and intelligent services will hardly be single-supplier or proprietary, but will have to integrate more products and services from a variety of different vendors. They must also be able to use the data generated by people, devices and processes and the professional expertiseand local support for implementation.
Last, but not least, solutions must be accessibile for the end users, maybe introducing new purchase solutions (as-a-service, insurance, sharing, etc).
We are creating a community of relevant stakeholders to accelerate this process through a series of initiatives and partnerships. If you are interested please let us know, we will be happy to share further information (firstname.lastname@example.org).