By: James Watson

Senior-Care, a Growing Industry

There is a lot of popular discussion surrounding the senior care industry, its outstanding positive growth trend and the factors that are contributing to it. It is commonly understood that this growth is due to, in a very large degree, an aging population that is increasingly using the industry’s products and services.

My blog article focuses on this understanding, highlighting that while the aging population is certainly increasing their demand, questions remain as to how different demographic factors are playing into it.

For example, is the sheer size of this aging population contributing to the outstanding growth boasted by home health care agencies or are there other factors that are much more influential? Careful critical thought and analysis must be applied when trying to understand this.

Home Healthcare Agencies | Homecare

The idea for all of this came to me while I was browsing some industry relevant blogs and literature on the internet. I came across a pair of blogs – one whom cited the other – that I found especially interesting. The first article I read was Growing Aging Population a Myth? Yes According to This Analyst, written on behalf of the SeniorCareMarketer.com Blog. The author is responding to an article written by Daryl Davis titled, Home Healthcare Industry: Ghosts in the Demographic Machine. The first article (SeniorCareMarketer.com) concludes about Davis’ article:

“The article [by Davis] was written from an investment perspective and the author suggests not investing in this industry because in his opinion the growing aging population is a myth and does not support the dramatic growth of HHAs [Home Healthcare Agencies].” (SeniorCareMarketer.com)

The problem is that this judgment by SeniorCareMarketer.com is in stark contrast to what is actually presented in Davis’ article. Davis never suggests that investing in the home healthcare industry is a bad idea. All he is trying to explain is that telling investors the home healthcare industry is a great investment because of a growing senior population is misleading. There are other factors contributing to its growth.

Aging Population is Not a Myth

SeniorCareMarketer.com’s response to Davis’ article appears to be a defensive reaction to what it interpreted as a direct attack upon a popularly held belief about the causes of an industry’s growth, rather than a thoughtful critique of the true content of Davis’ article. It highlights this discussion of growth, in particular the idea that the allegedly burgeoning size of the aged population is the predominating factor.

Davis never implies that the aging population is a myth. In actuality, he affirms it. Using United States census data to infer the proportionate size of the aging population most likely to employ home healthcare agencies (generally defined by Davis as those aged 75 and above), Davis finds that the outstanding economic growth boasted by home healthcare agencies is much greater than the growth in size of that particular demographic. In other words, the growth in the number of seniors entering the marketplace only because they are getting older cannot entirely account for the growth of the home healthcare agencies. Since Davis was only taking an individual’s age into account for his analysis, other forces must be factoring into the industry’s growth.

On an encouraging note, Davis concludes that once the real majority of the baby-boomer demographic begins to require homecare services in fewer than 10 years from now, their sheer demographic size will drastically affect the industry and become a leading factor in its growth. Couple that with all of the other positive factors playing into the mix right now and the picture looks very rosy.

Deciphering the Causes for Growth in Senior-Care

As this example of the home healthcare industry shows, it may be that the sheer size of the aging population is not the predominate factor in the growth each of us professionals observe and talk about within this senior-care industry. Maybe it is mostly changing attitudes on the part of the consumer. Maybe professionals are engaging the community better, improving education and collaborative efforts. There could be some structural factors too – like political lobbying and institutional reform – that are helping to create new markets. This should be encouraging because we all know that the population wave is coming eventually too.

So rather than unabashedly buying into the popular rhetoric being thrown around, it is necessary to diligently uncover and examine all the facts before making a statement about it. We must think critically about the marketplace and its varying degrees of complexity – seek to understand all of the factors affecting it. For the better of both sides of the equation – those providing a service and those receiving it – everyone must commit to this due diligence of statement and thought or else we risk misinforming and misleading.