Retirement care costs in Hong Kong to balloon six-fold: HSBC
As Hong Kong's long-lived population boasts the highest life expectancy in the world, the cost of taking care of the eldery is expected to soar 570% by 2020 to $5bn, according to a report by HSBC Life, The Women Foundation and The University of Hong Kong.
The research, titled ‘Eldercare Hong Kong: The Projected Societal Cost of Eldercare in Hong Kong 2018 to 2060', reveals that the cost of taking care of the city's elderly - whether through a subsidised or non-subsidised assisted-living facility or at home - is expected to reach HK$222.4bn ($28.34bn) per year in 2060. This marks an increase of 5.7 times from the current cost of HK$38.8bn per year.
Men in Hong Kong are living, on average, up to 81.3 years and women even longer, 87.3 years, as of 2016. "Over the last few decades, (Hong Kong) has caught up in a big way," Dr. Timothy Kwok, professor of geriatric medicine at the Chinese University of Hong Kong told CNN.
It is critical that individuals and employers take actions now to reduce what will otherwise be a substantial burden on Hong Kong society"
According to the study, around 342,000 people, or approximately 5% of the total population, received eldercare in 2018, and a total of 45,000 working adults provided eldercare for a family member.
The number of eldercare recipients is projected to double in 20 years' time to 729,000 and reach 890,000 by 2060 (11% of the population). Meanwhile, the number of informal caregivers will also double to 89,000 in the next 20 years, and then further increase to 97,000 in 2060.
Edward Moncreiffe, HK Chief Executive Officer, HSBC Life, said, "The fact that the number of Hongkongers receiving, and giving, eldercare is expected to double in the next 20 years should be a massive wake-up call for all of us who work and live in Hong Kong.
"With increasing life expectancy and the demand for eldercare increasingly outstripping available supply, the outcome may be significant costs to employers and employees. It is critical that individuals and employers take actions now to reduce what will otherwise be a substantial burden on Hong Kong society."
The indirect costs to employers and informal caregivers - in terms of lost employee productivity - will also rise steeply. According to the projections illustrated in the study, the current indirect cost of eldercare for employers is HK$1.8bn. This will rise to HK$5.3bn by 2040. By 2060, the cost to employers is expected to grow 4.7 times to approximately HK$8.4bn.
For informal working caregivers who lose both income and career advancement opportunities, the total opportunity cost is projected to increase dramatically - approximately four times - from HK$1.8 billion in 2018, to HK$4.9 billion by 2040, and to HK$7.2bn in 2060.
Dr Vivian Lou, director, Sau Po Centre on Ageing, The University of Hong Kong said, "The number of unpaid caregivers in the workforce providing care for the elderly is expected to increase dramatically in the coming years. The economic costs of eldercare can be felt not only by society but employers and employees as well.
"There are no easy solutions to this issue but we believe public-private partnerships can be the primary solution to providing quality and cost-effective eldercare in Hong Kong. Through this partnership, we look forward to a future where no-one feels obliged to leave the labour force because of eldercare."
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