Age Structure
3.13 South West England has a lower than average working age population as a proportion of total population. While the South West accounted for 10.1% of the national total population in 2006, 11.8% of the retired population but only 9.7% of the working age population live in the South West. Furthermore, only 9.5% of children in England – a major source of SW labour in the future - live in the South West.
3.14 Population projections produced by the ONS suggest that by 2029 26% of the population will be 65 compared to 19% in 2006. For further information on population projections please refer to the Population and Migration chapter.
3.15 It is of concern that an ageing population will lead to a drop in economic activity rates in the region based on an assumption that economic activity rates are lower for older people. However, applying current regional age-specific economic activity rates to the ONS population projections suggests that there will be no significant change in the overall activity rate within South West England in the period up to 2028 (McVittie 2005).
3.16 The Government has identified skills as one of its five productivity drivers. Older workers collectively possess a large pool of skills and knowledge that can potentially benefit the economy - human capital theory is based on the assumption that skills and knowledge are augmented over time. A challenge for employers is to translate these skills and experience into productivity gains, as well as ensuring that the skills and knowledge of older workers remain relevant to the needs of a modern economy.