Although Isle of Man residents are up to 30% better off than US citizens, the ageing population could be destined to have a serious impact on Manx prosperity in future, according to RBS Group economist, Stephen Blackman.

Addressing a gathering of finance professionals in the Isle of Man, Stephen Blackman warned that the Isle of Man was entering a period when the proportion of the population who were not of working age would be on such a scale that local prosperity would be adversely affected, unless measures were taken to address the issue.

He told the audience that the Isle of Man’s standard of living was under threat simply from natural demographics.

He reached this conclusion through an analysis which compared the wealth of the Isle of Man with the USA and competitor jurisdictions such as Jersey. By comparing GDP (gross domestic product) per head, based on how many people as a proportion of the population were of working age, how many hours on average they worked and how productive they were for every hour they worked, he produced figures that showed that the Isle of Man and Jersey were broadly similar in terms of their prosperity per head, and three times richer than the US. However the figures also highlighted that this position was under threat because of the ageing population. He commented:

“The Isle of Man like the rest of the world is seeing a rise in the old age pensioner ratio compared to the number of working age and the number in employment is going to be hit because of it. In order to maintain its standard of living in terms of GDP per head therefore, either people are going to have to work harder or become much more productive or the Isle of Man is going to have to boost its population.”

He added:

“The big debate that is going to have to take place in the IoM, and its already started in Jersey, is how do the Islands manage to maintain the quality of life which they have become accustomed to and which are essential for Island life and balance that with the need to increase population. Without an increase in population with an ageing society, and based on these figures, the standard of living in terms of GDP per head is going to naturally fall.”

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