Hawaiʻi’s population is aging rapidly, and one way to keep the economy afloat is by investing in education for the children who will eventually carry the economy when they enter the workforce.
A University of Hawaiʻi Economic Research Organization report published in December analyzed the possible economic impacts of an aging population, and how the state can prepare for the changes.
It said that in 2025, about 25% of the state’s population is projected to be 65 years old or older, and that support for programs that they depend on would be a good way to prepare for the future.
Shoring up Social Security funding is mostly the responsibility of the state’s congressional delegation, although the UHERO report recommended that the state come up with contingency plans if federal programs like Social Security or Medicare fail.
One of the top recommendations for policymakers is to invest in children — specifically in education and training as they enter the workforce.
“The number that are just aging into our workforce from younger ages is smaller, and the number of workers is not likely to grow in the future, so the only way to deal with that is to try to increase the productivity of those workers. And I think education is key to that. And one of the shocking things in our study, to me, was that per capita spending on education declined over the last 10 years,” said Andrew Mason, an economic analyst who conducted the report.
The report said that countries with low fertility — and fewer children — have responded by spending more per capita on health and education. That helps “maintain productivity growth and the tax base,” the report said.
Mason also said many seniors own property in Hawaiʻi but aren’t incentivized to sell and use that money for retirement. Providing more assisted living facilities could be one way to tap into the funding in properties owned by kūpuna.
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