The declining birth rates and increasing longevity in advanced economies within Asia pose significant challenges to traditional retirement systems and economic growth. This demographic shift has already reduced annual GDP per capita growth by 0.2 percentage points over the past 25 years, with potential further declines of 0.4% annually over the next quarter-century. To counteract these effects, countries must focus on enhancing productivity, workforce participation, and migration policies.
Enhancing Workforce Participation and Productivity
In response to dwindling birth rates, advanced Asian economies are exploring ways to bolster their labor forces. Increasing workforce participation among older adults and women has become a critical strategy. For instance, Japan has seen a notable rise in labor force participation among those aged 50 to 79, from 55% in 1997 to 56% in 2023. This trend is particularly significant as it contrasts with decreasing participation rates in other regions. Additionally, the number of working individuals aged 65 and older in Japan exceeds that of any European or North American country. The participation rate for prime-working-age women in Japan has also surged from 68% in 1997 to 82% today.
Boosting productivity is another essential tool for mitigating the impact of demographic changes. Historically, advanced Asian economies have experienced robust productivity growth, averaging 1.7% annually over the past 25 years, higher than North America's 1.5% and Western Europe's 0.8%. China's productivity growth has been especially remarkable, averaging 7% annually from 1997 to 2023. However, sustaining such high growth rates will be increasingly difficult as populations decline. Countries must leverage new technologies, including generative AI, to maintain and enhance productivity levels. By integrating advanced technologies into various sectors, these nations can offset the negative effects of shrinking workforces and ensure sustained economic vitality.
Reconsidering Migration and Social Policies
Migration presents an alternative solution to address labor shortages caused by low fertility rates. Traditionally, net migration in advanced Asian economies has been low or even negative. However, recent trends indicate a shift, with Japan leading the way in reversing this pattern. Encouraging skilled migration could provide a much-needed influx of workers, supporting economic growth and alleviating pressures on social systems. Moreover, these countries possess certain structural advantages compared to their Western counterparts, having made fewer societal commitments to support seniors. For example, Australia and Japan allocate transfers covering 42% and 51%, respectively, of the gap between elderly labor income and expenditures, compared to 59% in Germany and 76% in France.
To navigate the impending demographic challenges, advanced Asian economies must adopt innovative approaches to retirement systems, emphasizing efficiency rather than expanding deficits. Engaging older workers, harnessing technological advancements, and effectively attracting migrants are crucial steps toward sustaining economic success. By implementing these strategies, these nations can set a precedent for others facing similar demographic shifts, ensuring resilience and continued prosperity.
The healthcare industry is witnessing a transformative shift towards addressing the unique health needs of women. Historically, medical research has often overlooked sex-based differences, leading to suboptimal treatments for female patients. However, recent insights reveal that prioritizing women's health can enhance therapeutic outcomes, drive innovation, and unlock significant economic potential. By integrating sex-specific strategies across research, development, and commercialization, the biopharmaceutical sector can pave the way for more precise and effective healthcare solutions.
Addressing the Gender Disparity in Healthcare Outcomes
Women experience a higher burden of poor health compared to men, partly due to inadequate consideration of sex-based biological differences. This disparity stems from historical exclusion from clinical trials and underfunded research into female-specific conditions. As a result, diagnostic tools and interventions frequently fail to account for women's unique symptoms and physiological traits. Addressing these gaps is crucial for improving quality of life and tapping into new market opportunities.
To bridge this gap, it is essential to recognize the critical role of cellular sex, hormonal impacts, and genetic factors in disease manifestation and treatment efficacy. Emerging evidence underscores the importance of understanding how sex influences immune responses, fat distribution, and metabolism. For instance, Novartis' heart failure drug ENTRESTO demonstrated significantly better outcomes for women, leading to expanded FDA approval and reaching millions more patients. Similarly, UCB's CIMZIA therapy for chronic inflammatory diseases received an indication expansion for pregnant women, highlighting the need for tailored treatments that consider sex-specific safety and efficacy.
Leveraging Sex-Based Insights for Innovation and Value Creation
The pharmaceutical industry has a unique opportunity to drive innovation by embedding sex-specific approaches throughout its operations. This involves rethinking R&D methodologies, enhancing patient journeys, and refining commercialization strategies. By doing so, companies can address large unmet needs, create targeted therapies for women, and achieve substantial economic returns. Data generation and analysis play a pivotal role in informing decision-making and shaping effective women's health strategies.
R&D organizations can advance personalized medicine by conducting preclinical research using female cell lines and animal models. Increasing basic research into female-specific conditions like endometriosis and polycystic ovary syndrome can lead to breakthroughs in treatment and market potential. Tailoring asset strategies with a women's health lens ensures that development plans account for sex-specific thresholds and desired effects. Designing clinical trials to include diverse female populations and addressing barriers such as transportation and childcare can improve recruitment and completion times. Additionally, disaggregating trial data enables continuous improvement in addressing sex-specific health needs.
The book "The Broken Rung" by Kweilin Ellingrud, Lareina Yee, and María del Mar Martínez explores the challenges women face in their careers, particularly at the early stages. The authors delve into why women, despite excelling academically, often struggle to advance in their professional lives. They introduce the concept of "experience capital" and discuss how biases, health gaps, and motherhood impact career progression. Through a decade of research and personal experiences, the authors provide strategies for women to succeed despite these obstacles.
Understanding the Broken Rung Phenomenon
The term "broken rung" refers to the initial barrier women encounter when trying to achieve their first promotion. Despite making up nearly half of entry-level positions, women's representation drops significantly at the manager level. This disparity highlights a critical issue in career advancement. The authors emphasize that this problem is not just about the lack of opportunities but also about the systemic biases and structural challenges that prevent women from building valuable experience capital.
Experience capital is the accumulation of skills and knowledge gained through work experience, which significantly influences career earnings. Women often miss out on this crucial aspect due to various factors such as unconscious bias and limited access to leadership roles. The book underscores the importance of choosing the right company that invests in employee development and provides opportunities for growth. By focusing on skill-building and mobility, women can start accumulating experience capital early in their careers. Additionally, the authors highlight the need for bold career moves and facing inevitable headwinds with resilience.
Navigating Career Challenges and Biases
Women face numerous challenges in the workplace, including biases that hinder their progress. The authors explore different types of biases, such as likability bias and parental bias, which disproportionately affect women. These biases create an environment where women's contributions are often overlooked or undervalued. The book emphasizes the role of allyship in combating these biases, encouraging colleagues to speak up and support one another. Simple actions like acknowledging someone's idea or interrupting biased behavior can make a significant difference in creating a fairer workplace.
Motherhood presents another layer of complexity for women's careers. The authors address the "motherhood penalty," where women tend to earn less with each additional child, while men experience a "fatherhood bonus." This disparity is exacerbated by the double shift many women face, balancing professional responsibilities with unpaid care work. The book offers practical advice for navigating maternity leave and re-entering the workforce, emphasizing the importance of planning, maintaining networks, and seeking sponsorships. Moreover, it advocates for policies that support both parents, promoting a more balanced approach to family and career life.