Inequality and Population Ageing: A Silent Threat to Latin America

Posted in: Culture and policy, Economics, Evidence and policymaking, Global politics, Public services, Welfare and social security, Young people

Brandon Hernandez highlights Latin America's rapid ageing amid persistent inequality and weak social protections, trapping many young people in poverty. With high labour informality and limited social mobility, the region faces severe socio-economic challenges. Hernandez calls for urgent policy reform and regional cooperation to address ageing, improve youth opportunities, and combat intergenerational poverty.

Brandon Hernandez is an Internationalist from the Universidad del Norte (Colombia). He holds a Master's degree in International Cooperation and Project Management from the same university and a Master's degree in Political Communication and Marketing from the Universidad de La Rioja (Spain). Currently, he is pursuing an MPA in Social and Public Policy at the University of York. He has over six years of experience in youth issues, civic participation, education, and youth employment. Brandon's research interests lie in the study of inequalities in the Global South. Currently Brandon works in the third sector in Colombia. His first blog for the IPR on informal youth labour in the global south can be found here.

 Little is being said about the demographic shift that Latin America is undergoing, intersecting with the social inequalities that have long defined the region's reality. It is important to recognise that this shift is happening in a traditionally youthful region that, in recent years, has been ageing at an alarming rate. While Europe and Asiaexperienced population ageing alongside sustained economic growth and the construction of robust welfare systems, Latin America faces this phenomenon with a fragmented social protection system, a predominantly informal labour sector, and some of the world’s most significant inequality gaps. And the combination of these variables is becoming asilent threat that may emerge in the coming decades in the region.

The data speaks for itself. According to CEPAL, over the next 20 years, the proportion of people aged 60 and over in Latin America could double. By 2038, we may reach a scenario where the number of people aged 0-14 equals thenumber of people aged 60 and older. This accelerated ageing process, which took over a century in other regions,finds Latin America without proportional economic growth to meet the needs of an ageing population. High labour informality — affecting more than 50% of the workforce — leaves millions without access to pensions or savings for oldage. This means that, within a few decades, the region faces the threat of widespread poverty among its elderly population.

In this context, inequality in Latin America has barely receded, despite significant socioeconomic progress. Thisstagnation is largely due to the structural roots and self-perpetuating nature of inequality, as seen in cycles of intergenerational poverty. Recent studies by the Inter-American Development Bank (IDB) and RED 2022 indicate that opportunities for social mobility in Latin America are extremely limited. On average, a person born into a poor household has five times the likelihood of remaining in poverty throughout their life compared to someone from a high-income background. This is compounded by educational and health inequalities, with young people from low-income households 50% less likely to complete secondary education. RED 2022 shows that in countries like Brazil, Mexico, and Chile, rising from the bottom 20% of the income bracket to the top 20% could take up to six generations. This reliance on the “birth lottery” means that uncontrollable factors like family background weigh more heavily on young people's future success than their effort or skills. This reality is especially critical in an ageing context, as those who cannot escape poverty in their youth will face old age with an economic and social burden placed directly on the shoulders of today's youth.

This trend of low educational and occupational mobility makes Latin America the region with the highest persistence of income across generations. This compounds projections by the International Labor Organization (ILO), which reports that 64% of young people aged 15-24 in Latin America currently work in the informal sector, lacking access to pensions or social protection. Informality disproportionately impacts the most vulnerable groups, limiting their personal and professional development opportunities and putting their future well-being at risk. Ageing, in this context, places anadditional burden on young people: the "triple burden" of working, raising their children, and caring for their elderly parents or grandparents. In this

 

sense, prospective inequality policies imply a complex design that should also take into account the demographic reality.

Considering this scenario, it is urgent for Latin America to prioritize public policies that recognize the convergence between inequality and population ageing. Otherwise, the region will continue edging toward irreversible socio-economic outcomes. Governments need to focus on more decisive actions to strengthen access to quality educationand promote formal employment among youth. Also, it is time to promote deep policy discussions about healthy ageing or even employment opportunities at an older age. It is clear that the current pension and welfare systems in Latin America are not prepared to withstand the pressure of a growing elderly population. In this regard, ageing should not become an economic burden. However, some questions arise about whether the region has that approach since it seems that it is not a policy priority.

Finally, addressing inequalities requires both a deep local understanding and global learning. The accumulated experience in Europe and North America offers valuable lessons on how some countries have managed similar challenges. Thus, disaggregating inequality is a technical task and necessary to accurately diagnose the gaps and design comprehensive responses addressing gender, race, ethnicity, territory, socioeconomic level, and other variables. Additionally, this process calls for a regional cooperation strategy oriented toward joint action, in which Latin American countries unite to share knowledge, resources, and experiences, especially at a time when the region faces increasingly interdependent economic and social challenges such as migration, climate change, and, of course, population ageing.

All articles posted on this blog give the views of the author(s), and not the position of the IPR, nor of the University of Bath.

Posted in: Culture and policy, Economics, Evidence and policymaking, Global politics, Public services, Welfare and social security, Young people

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