As Hong Kong’s graying cycle accelerates, with the number of elderly residents projected to hit 2.6 million in less than three decades, leading enterprises have jumped on the bandwagon with an eye on a slice of the ‘silver’ economy. Sylvia Chang reports.
It’s well known that Hong Kong’s society, like those in many advanced economies, is aging rapidly. The problems associated with this graying trend are also well documented. Less obvious are the business opportunities arising from what has become commonly known as the “silver tsunami”.
The force of the “silver” crowd is most apparent in the mornings and afternoons at supermarkets, shopping arcades, tea houses and, yes, Starbucks cafes and McDonald’s restaurants, especially those in the middle-class residential districts. Those elderly shoppers, mostly retired, may not be big spenders. But their swelling ranks and specific needs are beginning to catch the attention of local retailers.
“We’re now at a turning point where the ‘silver tsunami’ could be transformed into booming business opportunities which can help boost the economy,” said Alfred Chan Cheung-ming, chair professor of social gerontology at Lingnan University and chairman of the Elderly Commission.
Longer life span
Currently, one among every six people in Hong Kong is above 65, calculated as nearly a million of the city’s 7.19 million population. Due to a longer life expectancy and a low fertility rate, the number of elderly residents is expected to mushroom to 2.6 million by 2041, suggesting that one in every three people will be elderly, according to Census and Statistics Department statistics.
In the next three decades, Hong Kong is likely to see a drastic shift in the population’s age structure, more than enough to reshape its economy. The most immediate and direct consequence of an aging population is a dwindling labor force, as more workers call it a day and fewer young people enter the market. A rapid population rise will also slow down wealth growth, leading to higher interest rates and falling asset prices.
The Asia Pacific’s “silver” economy is expected to hit $3 trillion (HK$23.4 trillion) by 2017, according to the Second Asia Pacific Silver Economy Business Opportunities Report 2013.
The first Aging Asia Silver Economy Index was also launched, showing the rankings of countries in the Asia Pacific, by market potential, of aging baby boomers. Hong Kong topped the list, followed by Australia and Singapore, in the Ageing Asia Silver Economy Index. It took into account a combination of per capita household savings for those aged above 60, growth in overall household savings, the percentage of aging population and life expectancy at birth.
A three-day Retirees & Seniors Fair held at the Hong Kong Convention and Exhibition Centre earlier this month drew more than 70,000 visitors — up 9 percent from last year’s four-day event, according to the organizer, Vertical Expo Services Company Limited.
“There’s an obvious spending power trend from people approaching retirement age. The number of visitors to the fair who were aged 46 to 55 went up to 18 percent from last year’s 12 percent,” Emily Chu, the event’s project executive, told China Daily.
Besides traditional products for senior citizens, such as medical and health products, new categories, including investment, travel and fashion, were introduced at the fair.
Package tours offer
Morning Star Travel Service Limited — one of the city’s popular travel firms — launched its “Silver Friends” series, offering eight package tours for the elderly.
“We do consider the specific needs of the elderly. They differ from common tours in many ways, such as the length of the tour, and avoiding attractions that may seem to be out-of-bounds for the elderly, like climbing a steep hill. Thus, more time can be spent at fewer spots,” said Wilson Yeung Chun-bong, marketing manager with Morning Star.
Most of the tours in the series offered cover religious sites, such as Putuo Mountain in Zhejiang Province —one of the four holy Buddhist Mountains on the mainland — and Fo Guang Shan, the largest Buddhist monastery in Taiwan.
“Retired people would like to visit calm and peaceful places where they can pray for their families and, at the same time, enjoy the tranquil atmosphere,” Yeung said. Lectures on religion and culture will also be arranged for those on the tour.
Fashion-wise, Hong Kong Apparel Society Limited (HKAS), a local association focusing on the apparel industry, showcased its “Smart E” brand, designed for the elderly, in two series entitled “Elegant” and “Essential”. The company said the branding is committed to developing “materials and styles with functions of medical health care”.
“The clothes are made of comfortable materials which help the elderly with mobility restraints,” explained HKAS Vice-Chairperson Maylie Kan.
Patrick Lung Po-kei, director of designs for “Smart E”, said the clothes are tailored to those between 60 and 80 years old. “As people reach such an age, their physical flaws become obvious. But a person’s pursuit of beauty will never change. So, we’ve made some alterations to common clothing, for example, loosening the hem of a coat so as to hide the chubby belly,” he said.
As for color, Lung said clothes for the elderly can’t be too elaborate and ornate, yet not pale as well. “So, it’s hard to strike a balance. I’ve tried to keep each item simple, but to make the whole suit compatible,” Lung said, demonstrating how a plain light orange coat can look as fashionable when matched with a black-and-white striped mid-skirt. “That would be more elegant with a pair of diamond necklace,” he murmured.
Unfortunately, the brand is not produced on a massive scale, Lung said. “Only a few small factories on the mainland have shown enthusiasm and cooperation in getting it out. Factories in Hong Kong aren’t interested in the ‘silver’ market. They would rather sell their products on websites like Taobao than on the local market,” Lung added.
Prof Alfred Chan reckoned that the current local “silver” market is limited to traditional health-care and burial products. “Investors are all in pursuit of short-term interests while overlooking the dramatic shift in population structure,” he said. He also criticized the government for not coming up with relevant policies to promote a more mature business environment for the “silver” market.
Apart from a wider range of products for the elderly, another trend that has been emerging and will be a leading factor in the future “silver” market is the coming on stream of innovative health-care products, Chan said.
With the development of the tele-health and tele-care systems worldwide, the traditional model of health care has been experiencing dramatic changes. Innovative electronics and biometric instruments, such as the mobile emergency response system, the medical alert alarm, and tele-assisted living household items, stole the show at the Retirees and Seniors Fair.
Some of the products allow remote control and monitor and can be tracked by demand or in an emergency.
“The demand is huge, especially for the group of people who are now in their 50s and are due to retire soon,” Chan said. He called this generation “the invisible” who are “cash-rich and asset-rich” and thus has great potential in the “silver” market. People of this generation were born in the 1960s when Hong Kong launched its economy drive, followed by the rise of the light industry in the 1970s, and then the business model in the 1980s. Having experienced rapid economic growth in the past three decades, they have accumulated a great amount of wealth and property, Chan indicated.
Compared with the existing elderly population, most of whom depend on the dole, many elderly citizens of the next generation will be better-educated, better-informed, tech-smart and more willing to stay active in the community. They will be more individualized in lifestyle and inclined to plan ahead for their retired life, Chan said.
“That will occur in only three to five years. With the startling change in population structure, a coordinated shift in the traditional mindset for the ‘silver’ market can be expected,” he concluded.
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