RUSSIA AND MONGOLIA: SPECIFICS OF POPULATION S AGING

International Journal of Civil Engineering and Technology (IJCIET) Volume 9, Issue 11, November 2018, pp. 2546 2550, Article ID: IJCIET_09_11_257 Available online at http://www.iaeme.com/ijciet/issues.asp?jtype=ijciet&vtype=9&itype=11 ISSN Print: 0976-6308 and ISSN Online: 0976-6316 IAEME Publication Scopus Indexed RUSSIA AND MONGOLIA: SPECIFICS OF POPULATION S AGING Valentina Grigorievna Dobrokhleb, Vyacheslav Veniaminovich Lokosov, Olga Nikolayevna Makhrova Institute of Socio-Economic Studies of Population of RAS, 32 Moscow, Nakhimovsky Prospect, Russia, 117218 ABSTRACT The article provides a comparative analysis of the population s aging process in Russia and Mongolia. Even though the population s aging process is more relevant for Russia, since the population of Mongolia is much younger, in both these countries, firstly, the low level of life expectancy is observed and, secondly, pension reforms have begun. The pension reforms will be expressed primarily in increasing the retirement age. The reforms will lead to a reduction in the number of Russian and Mongolian citizens, primarily men, who will receive pension payments. The authors conclude that population s aging and an increase in the retirement age will lead to negative demographic changes, an increase in mortality and disability rate, as well as changes in the labor market. Key words: demographic aging, pension reform, life expectancy, labor market Cite this Article: Valentina Grigorievna Dobrokhleb, Vyacheslav Veniaminovich Lokosov, Olga Nikolayevna Makhrova, Russia and Mongolia: Specifics of Population s Aging, International Journal of Civil Engineering and Technology (IJCIET) 9(11), 2018, pp. 2546 2550. http://www.iaeme.com/ijciet/issues.asp?jtype=ijciet&vtype=9&itype=11 1. INTRODUCTION The international scientific community recognizes that population s aging is a global trend that affects many aspects of the socio-economic development of society. In 2017, there were about 1 billion people in the world aged 60+, which is 13% of the total population of the Earth. The growth rate of the number of older age groups makes 3% annually. The UN materials show that by 2050 the number of people aged 60+ will double: from 962 million in 2017 to 2.1 billion in 2050. According to projections, 65% of the increase in people of this age in the period from 2017 to 2050 will be in Asia, 14% in Africa, 11% in Latin America and the Caribbean, and the remaining 10% in other territories. In connection with the increase in life expectancy, the number of 80+ people increases: globally, from 137 million in 2017 to 425 million people in 2050. At the same time, at the level of regions and countries, there are significant differences in the dynamics of population s aging process. The most demographically old is the European http://www.iaeme.com/ijciet/index.asp 2546 editor@iaeme.com

Valentina Grigorievna Dobrokhleb, Vyacheslav Veniaminovich Lokosov, Olga Nikolayevna Makhrova continent, whose population is almost twice as old as the world s population. In Europe today every fourth person is an elderly or old person. The largest number of elderly people live in Asia 540 million people or more than half of the world population of older ages. In 2017, 27% of all persons aged 80+ lived in Europe, but this proportion will decrease to 17% by 2050, while the population of other regions continues to grow in size and becomes older [1]. The population of Mongolia is much younger than the world population as a whole, as well as the population of Russia. The share of elderly and old people in 2017 in Mongolia was 7%, and in the Russian Federation this figure reached 21%. However, despite the difference in age structure, according to the IMF proposals, in Russia by 2030 the retirement age will be increased for women to 60 years, men to 65 years, in Mongolia by 2035 to 65 and 66 years, respectively. Obviously, this will affect many aspects of the demographic and socio-economic state of the population of the countries. 2. METHODS The study used a variety of theoretical approaches to the analysis of the aging process, as well as the concept of demographic transition. The stadia approach is complemented by the institutional approach of M.A. Klupt [2]. Within these approaches, the population s aging process has its own characteristics in various countries, which are formed due to the specificity of historical, geographical, socio-economic and other factors. In assessing the process of demographic aging (if the percentage of people aged 60+ is taken as an indicator), the scale proposed by French demographer J. Beauge-Garnier and modified by E. Rosset is used. The 65+ indicator is used in several Western countries and in UN international statistics. The aging coefficient of A. Sowie [3] has a more complex design structure. Based on these approaches, the comparative analysis of the statistical data of the two countries was carried out. 3. RESULTS Not only the number and structure of population are essential, but also life expectancy (LE). LE at birth in the period of 2010-2015 in the world for both sexes was 70.8 years, in the Russian Federation years, in Mongolia years [1]. Despite the increase in life expectancy in Russia (in 2016, life expectancy at birth for both sexes in Russia was 71.9 years: for men years, for women 77.1 years), there is a high gap between these indicators both for men and for women, in comparison with economically developed countries. Despite the different levels of demographic aging, both in Mongolia and Russia, the reform of the pension system has begun. By 2016, the population of Mongolia was 3.1 million people. Studies show that only half of the people of working age make contributions to pension insurance; 800 thousand employees participate in compulsory pension insurance and their contributions make up to 93% of all revenues to the Social Insurance Fund, the remaining 7% are formed at the expense of voluntary insurance. In Mongolia, in 2016, pensions were paid to 372 thousand citizens; two-thirds of them (268 thousand people) received old-age insurance pensions. The remaining third were pensioners for disability and for the loss of breadwinner [4]. As shown by Mongolian expert Mygmarjor Buyanjargal, with low life expectancy in today's Mongolia, and maintaining, for example, the current growth rate of life expectancy, if a new age limit for retirement is introduced, Mongolian men will receive retirement benefits only for seven to eight years [5]. In 2018, the law was adopted in Russia on reforming the pension system [6] and raising the retirement age. According to expert estimates, the implementation of this reform may currently have the following effect: http://www.iaeme.com/ijciet/index.asp 2547 editor@iaeme.com

Russia and Mongolia: Specifics of Population s Aging firstly, an increase in disability rate, which in Russia today is almost 5 times higher than that in economically developed countries; secondly, due to psychological stress, it can result in an increase in mortality rate, including in the age cohorts, which will primarily be affected by the reforms (these are more than 20 million people); thirdly, fertility rates are likely to decrease, since family support for grandchildren may decrease due to later retirement. Both in Russia and Mongolia, raising the retirement age is associated with the aging of the population and the need to improve the sustainability of pension funds. In publications of Mongolian press, it is emphasized that, without carrying out reforms of pension policy and system, the pension fund of Mongolia will soon become bankrupt. Today's pension insurance system should be terminated, and in its place, a new one should be created, which would meet the requirements of the time. Using today's favorable demographic situation, it is necessary to modernize the pension system, to create its multi-level structure, to update the methodology for calculating insurance pensions and pension contributions. When carrying out the pension reform, it is important to take into account the sex ratio. In countries, there is demographic gender balance in age groups up to 40 years. Gender asymmetry begins to take shape in the older age groups after 40-45 years. It is especially pronounced in Russia: in the cohorts of 70+, the number of women is 2.4 times higher than the number of men, this indicator for 80+ reaches more than 3 times. In Russia as a whole, the sex ratio is 1,157 women per 1,000 men. 4. DISCUSSION The population s aging process is objective and global. However, the range of its interpretations, understanding the consequences and optimal choice of managerial decisions is extremely wide. The main contradiction lies in the perception of the older generation as a demographic, dependent load on society or as a resource for development. Under the conditions of demographic aging, the need for obtaining relevant information about the situation, for scientific explanation of the consequences of the population aging process increases. The increase in the retirement age in economically developed countries was carried out with significantly higher life expectancy than it is currently in Russia. For example, in the UK, the retirement age for men and women is 65 years (for women it was increased in 2016-2017 from 60 years). In 2019-2020, this level will be increased to 66 years, and in 2026-2028 to 67 years. Further increase in the retirement age is planned in the years 2044-2046 to 68 years (in connection with the latest research on life expectancy, the possibility of making these changes in the years 2037 2039 is being considered). At the same time, life expectancy in 2013 was 79.2 for men and 82.9 for women. In Germany, a gradual increase in the retirement age from 65 years (for men and women) to 67 years has been carried out since 2012 based on the law adopted in 2007. The process will end in 2029. Until 2024, the retirement age will be increasing by one month per year, then by two months per year. Life expectancy at birth in 2013: for men 78.4; for women 83.1. In the United States, the retirement age is determined by the year of birth: for people born before 1960 (both men and women) - 66 years, for those born in 1960 and later - 67 years. Americans can go on early retirement starting at 62 years of age, but at the same time, they lose part of their payments. In the US, life expectancy at birth in 2014 was 76.4 for men and 81.2 for women. In Japan, until 2000, the pension was calculated from 60 years. Since 2001, this age threshold has gradually increased and in 2013 reached 65 years (for men and women). For those who continue http://www.iaeme.com/ijciet/index.asp 2548 editor@iaeme.com

Valentina Grigorievna Dobrokhleb, Vyacheslav Veniaminovich Lokosov, Olga Nikolayevna Makhrova working after 65 years, the amount of the pension increases annually. Life expectancy in Japan for men 80.1, women 86.8 (2014). When carrying out the reforms, it is necessary to take into account that the number of old people in Russia (who, according to UN definition, are people aged 65+), according to Rosstat estimates, in 2016 made almost 21 million people or 14.2% of the population. Of these, 6.3 million live in the Central Federal District, the smallest part of this age group in the Far East Federal District: about 736 thousand. The most demographically old region of Russia is Tula oblast, where 18.2% of the population are people aged 65+, the youngest subject of the Russian Federation is Chechen Republic, where 4.3% of the inhabitants are of this age. In Russia, the system of geriatric and gerontological care has not been created, which is necessary for the elderly and old people. A competent doctor of such specialization is hard to find even for money. The level of health of the population of Russia is the major problem and a civilizational challenge. It is necessary to better understand the peculiarities of the population s aging process in Russia. In 2017, the demographic list was presented in the country, in which, in addition to traditional indicators of the share of elderly and old people, the threshold of old age was calculated for different regions of the country not by chronological, but by prospective indicators, when the basis of calculations is the number of years left to decease. If this figure is 15 years or less, then the persons or certain age cohorts are considered old, if persons live more, then they do not belong to the old [7]. People in different regions of Russia are growing old in different ways. In the region with the highest life expectancy Ingushetia, men cross this threshold at the age of 70 (like in European countries). In the Tuva Republic it is 57 years, like in poor countries in Africa. In Pskov oblast 19.3% of the population have already crossed the threshold of old age, only 3.4% in Ingushetia [8]. The significant challenge is that the Russian Federation entered the second stage of depopulation. Rosstat on April 1, 2018 estimated the number of the resident population of the Russian Federation as 146.8 million people. From the beginning of the year, losses in the total population amounted to 40.6 thousand people, or 0.03% (during the same period of the previous year, the population decreased by 24.0 thousand people, or 0.02%). Migration growth compensated for 53.5% of numerical population loss [8]. Researchers note that in Russia the process of demographic ageing is formed from below primarily due to low birth rates, and the formation of demographic aging from above, associated with an increase in life expectancy, is slow. The proportion of people at the age of 65+, which has been formed in Russia by now, developed in Germany by the 70s, in Sweden by 1975, in Japan by the end of the 90s of the 20th century [9]. In Mongolia, there is a problem of expanding the coverage of the population by compulsory pension insurance so that livestock breeders and private sector workers receive pensions. The right of all citizens to retirement is enshrined in law, with only 9.1% of 261.7 thousand livestock breeders of working age provided with pension insurance [4]. 5. CONCLUSIONS The aging level of the population of the two countries has significant differences, while the issue of pension system reform is primarily connected by the authorities with financial problems of pension funds. Indeed, with an increase in the number and proportion of elderly and old people, the pension system is experiencing difficulties with the formation of the revenue base. However, with a low level of public health, raising the retirement age is associated with an increase in disability, this problem has already been encountered in the European Union [10]. When carrying out pension reform, it is necessary to link it with the http://www.iaeme.com/ijciet/index.asp 2549 editor@iaeme.com

Russia and Mongolia: Specifics of Population s Aging reform of the labor market, including for men and women of senior able-bodied groups, and more persistent development of the system of continuing education. The economic breakthrough is necessary for both Russia and Mongolia, and transition to the sixth technological order, introduction of robotics, poses other problems, primarily due to a reduction in the number of jobs of medium qualification and growth of unemployment not only of the elderly but also of the youth. It is necessary to disclose the features of changes in the position of older people, their social status, formation of stereotypes regarding older people, ageism, factors of their discrimination. Of particular importance is the development of a methodology for studying the health of people aged 60+, understood in a broad sense as physical, social and psychological health. ACKNOWLEDGEMENT The article was prepared with the support of the Russian Foundation for Basic Research, Grant No. 17-22-03004 OGN A. REFERENCES [1] World Population Prospects: The 2017 Revision, World Population Prospects, The 2017 Revision United Nations, New York, 2017. https://esa.un.org/unpd/wpp/publications/files/wpp2017_keyfindings.pdf. [2] Klupt, M.A. Paradigms and oppositions of modern demography. http://www.perspektivy.info/srez/val/paradigmy_i_oppozicii_sovremennoj_demografii_20 14-11-21.htm. [3] Pirozhkov, S.I. Demographic aging. http://ponjatija.ru/node/10826. [4] Zhargalsaikhan, D. Pension insurance is the time to retire, 2017. http://jargaldefacto.com/article/pensionnomu-strakhowaniyu-samomu-pora-na-pensiyu. [5] Sosorbaram, M. Raising the retirement age. The realities of Mongolia. http://asiarussia.ru/news/15929/. [6] The full text of the bill on raising the retirement age (adopted by the State Duma on September 27, 2018). http://vklader.ru/zakonoproekt-pens-vozrast/. [7] Russian demographic sheet 2016. http://www.populationrussia.ru/data/russiandemographicdatasheet2016_web.pdf. [8] Demographics on April 1. 2018 http://www.gks.ru/wps/wcm/connect/rosstat_main/rosstat/ru/statistics/population/demogra phy. [9] Denisenko, M.B. Population of Russia: demographic projections. http://www.mfcmoscow.com/assets/files/2016/consumers/02-hse.pdf [10] Growth of retirement age will increase the number of disabled and unemployed. https://ura.news/articles/1036274833?story_id=95. http://www.iaeme.com/ijciet/index.asp 2550 editor@iaeme.com