Longevity Innovation Hubs: A Missing Link in Embracing Ageing Populations?
This month, continuing our theme of exploring links between age, innovation and productivity growth, we explore how the development of Longevity Innovation Hubs within Australia might be a missing link in the chain in helping promote a longevity mindset within our decision-makers in politics, business and the community. Our inspiration comes from a recently published book ‘Longevity Hubs: Regional Innovation for Global Ageing’ which showcases cities and regions who are identified as hotspots for innovation surrounding ageing. Whilst completely subjective the book’s purpose is to act as a catalyst in encouraging innovation in the ageing space by highlighting the value of knowledge transfer, initiative and collaboration within and across different regions to spur the development and implementation of cutting-edge products, services and ideas to support ageing populations.
The book editors, Coughlin and Yosanto, broadly understand a longevity hub as any hot spot characterised by a disproportionate level of innovative activity aimed at the older population and related markets. They acknowledge there is no single unified theory describing what exactly constitutes a cluster or how they form, grow, mature and decline. We’re sure there are innovation experts reading this who know much more of the theoretical and applied intricacies in this space, but for the purposes of simplicity, traditionally, a cluster is often defined as an interconnected group of firms located in a given geographic area, which interact with similar markets, industries or technological fields.
The nature of innovation hubs
The connections between firms in such a cluster can create synergistic outcomes. Three factors generating such outcomes are identified: the sharing of a local pool of suppliers and customers; the sharing of a local pool of specialised labour; and the transmission of valuable knowledge through the location’s organisations and workers. Critical to a cluster’s success is the development of an infrastructure that promotes creativity and innovation. Sub-components of this infrastructure include:
The existence of a diverse network of entrepreneurs, researchers, investors and professionals who operate in a culture of open innovation and knowledge sharing.
The ability to access funding, resources and R & D support primarily, for the latter, through partnerships with universities and research institutions.
The creation of networking events, workshops and knowledge sharing sessions.
The willingness of industry and government to collaborate in the innovation space.
The embrace of technology to help drive stronger data insight and connection across the hub.
Unsurprisingly, to differing degrees the above sub- components extensively feature in the book’s analysis of how the featured longevity innovation hubs formed and have grown. Ground zero for the operation of a longevity innovation hub is Greater Boston in the USA. Louisville is also identified as another emerging US longevity hub. Internationally, Dubai, Japan, Milan, Newcastle in the UK, San Paulo, Tel Aviv and Thailand are further identified as developing longevity hub candidates. What distinguishes Greater Boston as a world leading longevity hub is that it is home to a significant amount of ground- breaking, age-oriented activity across a variety of industries, supported by neutral non-profit organisations, a growing venture capital funding structure, leading academic institutions, and key government stakeholders.
Potential drivers of a Longevity Innovation Hub
Coughlin and Yosanto present a working hypothesis that a potential driver of innovation promoting a longevity mindset will be delivered through tapping into an underserved demand of the world’s ageing consumers. They suggest the scarcity of useful knowledge into how to meet these needs may act as a force promoting islands of economic vitality- ‘longevity hubs’- that have the potential to prosper despite economic headwinds created by global population ageing.
The innovation focus can continue to be on ramping up investment in traditional ageing related industries- especially health care and retirement living. Whist an established industry, the authors argue this industry still has considerable growth potential due to our older population’s burgeoning size and spending power. New investments in ‘old growth’ markets may give a hub the means to tap wealth not only of local older cohorts, but also those hailing from other regions or countries. Another innovation focus can be in developing new products and product categories, particularly in the technology field. The authors note once a region branches out from a traditional age-related industry like health care and housing the potential avenues for entrepreneurial activity appear to multiply.
In 2024 the World Economic Forum produced a report highlighting key drivers for establishing a longevity economy. There exists a large overlap between these drivers and the highlighted innovation activities occurring in the longevity hubs featured in Coughlin and Yosanto’s book. The World Economic Forum identified six pillars of a longevity economy all open to continuing innovation. These included:
the requirement for individual financial literacy and resilience
the importance of healthy ageing,
the promotion of sustainable age -inclusive workforces,
the design of systems and environments facilitating social connection and purpose and
addressing issues of longevity inequality across gender, race and class.
The basic ingredients exist in Australia for Longevity Innovation Hub formation
In Australia we have many of the basic ingredients for the successful creation of Longevity Innovation Hubs. We have expertise in the creation of innovation hubs as witnessed by their already existing operation across different industry sectors. We have world class gerontology and population ageing research practices. We already have some small innovation hubs dedicated to promoting healthy ageing, one of which is in my own local area the Central Coast Health & Wellbeing Living Lab passionately led by a highly talented academic researcher. We have not-for-profit organisations dedicated to providing support and advocacy services and conducting research focused on ageism, ageing, and age-inclusive practices. We have some venture capital firms already investing in healthcare and life sciences. We have small business start-ups with unique knowledge in how to take advantage of older workers for improved business performance. We also have a willingness of government to ‘put their toe’ into the age management innovation space, an example being the Federal governments grant to Aged Care Research and Industry Innovation Australia to enhance workforce capability and promote an innovation culture within the aged care sector.
So, what might be some of the barriers or challenges inhibiting the development of Longevity Hubs within Australia, given most of the ingredients already exist for their creation?
Barriers and challenges to local establishment of a Longevity Innovation Hub
Five immediate obstacles present themselves. They are:
A lack of awareness of the potential longevity market opportunity
There exists within Australia a low awareness of our ageing demographic situation and its potential challenges and opportunities. Governments rarely explicitly acknowledge its existence; evidence suggests business seldom include the market possibilities of an ageing world into strategic plans and the media often choose to frame the ageing trend as a divisive intergenerational inequity problem.
There is a significant business opportunity to take advantage of with the 65 years of age and over cohort currently representing about 18% of the population and holding around 46% of the nation’s wealth. Australians over the age of 50 are letting policymakers and business know they desire their independence, seek active engagement with others, want to continue to meaningfully contribute to the world and desire financial security. As they age, they would prefer to do so in their own homes or in their existing communities although for many of this group they have not planned how they might do this. Many Australian workers over the age of 55 have indicated they are interested in continuing work during retirement, provided the work aligns with their lifestyle. Older Australians appear very amenable to ‘opening their cheque-books’ for products and services that are going to meet their needs and aspirations. Longevity Innovation Hubs represent a potentially powerful vehicle to disrupt traditional markets and unlock new business growth opportunities.
Coughlin and Yosanto at a more tangible level observe a critical enabler of the evolution of Longevity Innovation Hubs is the existence of what they call ‘buzz and pipeline’ frameworks. The interaction of ‘buzz’ represented by specific local tacit knowledge with global ‘pipelines’ represented by strategic partnerships, intra-company communications and other region- spanning social institutions or networks creates a dynamic process of learning, knowledge production and innovation that is central to understanding a hub’s success.
The establishment of global ‘pipelines’ the authors anticipate will play an important role in shaping global knowledge flows in the longevity economy. We guess (and am happy to stand corrected) in Australia in the ageing space their exist very strong traditional ‘buzz’ networks but global ‘pipelines’ of knowledge transmission remain a major development opportunity. We believe, for instance in Sydney, the creation of a global ‘pipeline’ of longevity management knowledge would not only reduce the existing fragmentation of valuable knowledge and its potential wastage but also potentially act as an accelerant to business buy- in to the benefit of participating within a regional Longevity Innovation Hub.
Business buy-in
Coughlin and Yosanto recognise having a spectrum of innovative companies driving commercialisation and acquisitions is vital. We pointed out in our last post the Institute of Company Directors observes Australian business has a thinking problem with Australian business ranking 78th in the world for knowledge diffusion and 52nd for knowledge absorption at the organisation level in a 2021 global survey. Given the existing low business awareness of the longevity economy as a new growth engine and the high levels of ageism still being experienced by local older workers this points to a major weakness in developing Longevity Innovation Hubs in the immediate term.
A fundamental requirement of a successful longevity innovation hub is the existence of a business ecosystem that welcomes age diversity as a bedrock of innovation and belonging. To the extent our business sector has yet to actively embrace this principle creates a workplace innovation opportunity to anchor the business case a longevity economy presents and the competitive advantage the creation of age inclusive workforces offers. The ability of business to access and engage with an established regional global ‘pipeline’ on longevity management knowledge we believe would accelerate both their understanding of the upside in engaging in the longevity market and encourage a decision to seek participation within their local innovation hub.
Funding constraints
Coughlin and Yosanto identify the importance of the existence of venture capital firms with a specific appetite for investing in the ageing population sector and a willingness to take significant risks to begin investing in an unrecognised growth industry. Locally, whilst we have venture capital firms already investing in healthcare and life sciences, there is a scarcity of those willing to specifically invest in the ageing population sector. To the extent a Longevity Innovation Hub can demonstrate their work will potentially contribute to making the world a better place to age seems a vital step in attracting new investors.
Policy questions focusing on the purpose and role of Higher Education are also impacting university funding and their research capabilities. Universities play a critical role in the successful operation of innovation hubs with their independent research abilities and provision of a neutral ground to facilitate competing interests and views in progressing new thinking and concepts. Funding cuts in this space risk restricting universities abilities to optimise their contribution to the operation of a successful longevity innovation hub.
Infrastructure support
Finally, at the most practical level, a common thread across existing international Longevity Innovation Hubs is the importance of age diversity to sustaining them. A critical success factor is the existence of an extensive local workforce instrumental to ensuring they can function. A supply of abundant housing, a transportation infrastructure that works for residents, a non-prohibitive cost of living and access to sources of critical services including health care, childcare and elder care are all pre-requisites for supporting a Longevity Hub’s operation. If you want a thriving Longevity Hub, it appears a thriving community is essential.
Some final thoughts
The book on Longevity Hubs can be understood as a first attempt in developing a global pipeline of knowledge in the longevity innovation space. By sharing a variety of case-studies, the book highlights the progress being made in addressing our ageing world. Importantly, it works to develop the beginnings of a typology for categorising hub candidates and the criteria for classifying them. Three tentative criteria emerge: the number of industries involved in the hub (one, few or many); the nature of the decision-making structure supporting the hub (grassroots to top-down); and finally, the level of government support for the hub (minimal, intermediate or total). None of these hubs emerged perfectly formed overnight. Instead, an iterative formation process of expanding networks, connections, knowledge-sharing, problem-solving and creative interaction helped their continual growth.
This creates a local sense of possibility for at least Sydney. In the first instance what might it take to develop a stronger network within the existing community of academics, practitioners and government representatives all sharing the common mindset of making the world a better place to age? How could such local, disparate, deep and evidence-based knowledge and experience be harnessed to begin exploring what the establishment of a global pipeline of longevity management knowledge might look like as a precursor to a regional Longevity Innovation Hub?
There is a good reason, Coughlin and Yosanto note, to believe that one key to a better and longer more sustainable old age may lie in better innovation for older people: from electronic gadgets to government policies; nutrition to transportation infrastructure; financial services to workplace reforms. Such efforts, in addition to addressing specific needs, can also serve as a form of media: transmitting an urgently needed corrective about the value of older people and later life.
Continuing to disregard and misunderstand older adults, the authors conclude, is a mistake that may haunt regions, and indeed countries, in the years to come. Everyone stands to benefit from better knowledge of the large, yet poorly understood forces poised to shape how we will live tomorrow.
Not sure how to get started? We would welcome hearing from you about how we might work to begin building a local global pipeline of longevity management knowledge.
References
Amazon Australia. (2023) Unlocking ‘The Lifestyle Years’: Australians over 55 are redefining retirement Report
Coughlin. J.F. & Yoquinto, L. (Eds). (2024). Longevity Hubs: Regional innovation for global ageing. The MIT Press. Cambridge, Massachusetts.
McCrindle. (2018). Older Australians Not Prepared for Their Future Age Care Report.
World Economic Forum. (2024) Longevity Economy Principles: The Foundation for a Financially Resilient Future. Insight Report. (January)
