Age-dependency ratios are a measure of the age structure of the population. They provide information about the demographic shifts that have characterised OECD countries in the past and that are expected in the future.
OECD populations became older and will continue to become older in the coming decades. In 2015, on average across OECD countries, there were 28 persons aged 65 and over for every 100 persons aged 20 to 64; up from 18 in 1970 ( 4.13). Cross-country differences are large, varying from less than 15% in Mexico and Turkey, to over 35% in Finland, Italy, Greece and Portugal and to over 45% in Japan. By 2060, the average ratio is projected to double in the OECD area (to 57%) and to quadruple in Korea. By 2060, the old-age dependency ratio will almost reach 80% in Korea and Japan while remaining below 45% in Israel, Mexico, Turkey and the United States. This increase will contribute to higher public spending in health, long-term care and pensions.
Conversely, the youth-dependency ratio declined between 1970 and 2015. In 2015, there were 38 persons aged below 20 for every 100 persons aged 20 to 64 on average across OECD countries, down from 70% in 1970 ( 4.14). In 2015, the youth-dependency ratio ranged between 30% in Germany and Korea and 65% or more in Israel and Mexico. In most OECD countries, this ratio will stop declining, reaching an average level of 39% in 2060, except in Chile, Israel, Mexico and Turkey. Lower youth dependency means lower public spending in education and towards families. But overall, the declines are not large enough to offset higher spending towards the elderly.
In emerging economies, old-age dependency ratios are in general lower than in OECD countries, particularly in India, Indonesia, Saudi Arabia and South Africa. By contrast, youth dependency ratios are higher.
4.15 also presents the past, current and future shares of youth aged 15 to 29 – those in age to enter the labour market – as a percentage of the total population. On average, the share declined from 22% in 1970 to 19% in 2015, with strongest declines in the “ageing” countries Japan, Finland, Italy and Spain. The average ratio is forecasted to decline even further to 16% of the total population by 2060, with the strongest declines in countries that will become considerably older in the next decades, like Chile, Mexico, Korea and Turkey.
