Beyond 100: Whitepaper

Introduction

When Bryson William Verdun Hayes turned 100, he celebrated by jumping out of a plane. A year later, the British World War II veteran became the oldest tandem skydiver on record after completing a jump with his family.

The prospect of being alive for longer has always fascinated us. But adding more years to our life is only half the story. What we really want is the chance to enjoy more healthy, active years, however we might spend them – from skydiving to starting a business or seeing more of our grandchildren – or great grandchildren.

We could be closer to this reality than many people realise. Scientists are working on ways to re-engineer our biology, accelerated by the emergence of deep learning in clinical trial research to dramatically improve drug development. As a result, within a couple of decades, we could be living to 110 or 120.

“All of the life expectancy improvements in the last 100 years, where human life expectancy has more or less doubled, have occurred as a result of environmental factors, improvements in sanitation, less infant mortality, fewer accidents at work and antibiotics,” says Jim Mellon, investor, entrepreneur and co-author of Juvenescence – Investing in the Age of Longevity.

“There has been no interference with fundamental biology that has caused an increase in longevity…Now we are able to fundamentally manipulate biology, and that’s going to feed into life expectancies very quickly.”

The promise of living to 100 or beyond could have a profound impact on people around the world. The traditional three-stage life – learning in childhood and adolescence, working throughout our adulthood and spending our older years in retirement – could be redefined by the next generation, if living to 110 or 120 becomes more common.

In this report, Barclays Private Bank has brought together viewpoints from specialist and leading experts in longevity research and biotechnology, work, housing and the economy. These industry experts tell us about the science behind longer life, and consider some of the implications for the economy, your family and your investments.

The science of longer healthier lives

Two years ago, scientists at the Mayo Clinic College of Medicine and Science in Rochester, Minnesota, discovered that they could extend the average lifespan of mice by up to 35%, effectively by programming some of their cells to self-destruct.

Two images of mice that had been treated with therapeutic drugs during the study, with one mouse markedly healthier than the other, got the attention of specialists from across the world. It was a clear and easy-to-grasp illustration of the long-held theory that eliminating old, ‘senescent’ cells could significantly delay or even reverse the ageing process. 

As the population of the world gets older, there is expected to be a significant increase in spending on healthcare and pharmaceuticals that help to prevent, diagnose and treat chronic illnesses and diseases.

However, over the last decade, there have been huge steps forward in bioscience and regenerative medicine, including gene therapy, stem cell research and organ regeneration, along with small molecule therapies. This has fuelled growing interest from academics and investors in the specialist area of longevity, or the science of longer living.

Longevity experts believe it could be possible to address some of the most common chronic diseases and conditions by looking at ageing itself.

Eric Verdin, CEO of the Buck Institute for Research on Aging, based in Silicon Valley, says: “This decade will be regarded as a historical inflection point for ageing research, both from a societal and scientific perspective.”

Dr Aubrey de Grey, Chief Scientific Officer at SENS Research Foundation, has been investigating novel ways of managing the ageing process for the past 25 years. His research includes examining ways to eliminate molecular waste products that accumulate inside and outside cells.

“Ageing is the process of self-inflicted damage accumulation,” he says. “Damage is the set of changes to the microscopic, molecular and cellular composition and structure of the body that eventually become too abundant; we are simply repairing and eliminating that damage before it gets to that problematic point.”

We could be at a tipping point. AgeX therapeutics is a biotechnology firm looking at how to reprogramme our bodies at a cellular level. Its researchers are trying to turn human tissue back to a younger, healthier state by applying the body’s own regenerative properties.

Michael West, CEO of AgeX Therapeutics, says: “Induced tissue regeneration could not just add years to our life, but potentially have significant applications in addressing chronic diseases.”

While a breakthrough in regenerative medicine may be years away, biotechnology experts believe deep learning and automation could soon revolutionise the search for new medicines.

AI and healthcare

The rapid acceleration in digital technology over the last 20 years has not been reflected in medical research, where innovation remains painstakingly slow. It can often take 10 years for a new drug to get to market, and clinical trials have a 90% failure rate.

However, this process is being upgraded with the development of a new type of artificial intelligence based on  Generative Adversarial Networks.

“Imagine a network of many layers of interconnected digital neurons, run by algorithms that function in a similar way to the human brain,” says professor Alex Zhavoronkov, founder of Deep Learning AI research firm Insilico Medicine, and pioneer of deep learning in medical research.

“As it’s exposed to data, a network can learn to generalise. And as we create more sophisticated architecture, and couple two algorithms together, they can acquire creativity, with the potential to imagine entirely new data. This could be new pictures, videos and even new molecules with specific properties that do not exist in nature”.

This means that for the first time, instead of trying to find a new drug by repeated trial and error, scientists can effectively define a very specific problem and then ask the network to develop a molecule from scratch that addresses that problem.

By analysing such data in AI-powered models, companies such as Insillico Medicine are able to test treatments and develop drugs much more quickly and accurately than through conventional clinical trials.

At the UK’s Oxford Sciences Innovation (OSI), Head of Network Intelligence Riwa Harfoush believes deep learning could lead to a revolution in healthcare.

“There are tools and devices that used to be big, expensive, require experts to operate, and be quite exclusive. We’re seeing these become better, cheaper, smaller, more democratic and more accessible, and that’s really changing the way that we’re thinking about both treating and preventing diseases.”

The changing nature of work and reskilling

If improvements in healthcare and developments in life expectancy become reality over the coming years, the impact on the way we work could be profound.

The next generation may dispense with the traditional blueprint for their career and embrace a more flexible mindset, argues Lynda Gratton, Professor of Management Practice at London Business School, founder of research consultancy Hot Spots Movement and co-author of The 100-Year Life.

She says the idea of a linear progression through full-time education, full-time career and then full-time retirement will seem less and less relevant. “We will see something much more flexible, where you come in and out of both education and work, all through your life. The idea of working until you’re 80 might seem depressing, but it won’t be working non-stop and without breaks – people will do other things, too,” Gratton adds.

“We’ll also see more freelancers, more people taking advantage of these new work platforms to work when they want to, and more people starting their own business. Already, the over-55s are more likely to launch their own businesses than any other age group.”

Automation and work

Around 14% of jobs currently done by humans are ‘highly vulnerable’ to automation, and another 32% will see significant changes to the way they are carried out, according to recent research by the Organisation for Economic Co-operation and Development (OECD).

For workers with the right skills, automation could make their current jobs more rewarding or create new opportunities that are more engaging. The World Economic Forum has warned that by 2022, 54% of workers will find they need significant re-skilling or upskilling.

That poses a particular challenge for the older workforce. In two years’ time, for the first time in history, there will be more human beings aged over 65 alive in the world than those under 5. By the end of this century, the number of people aged over 80 will have increased sevenfold.

“The rise of automation and AI, combined with people living and working longer, means lifelong learning is going to become a major trend,” argues Rajeeb Dey, founder and CEO of Learnerbly, which works with employers and other groups to help employees of every age to learn new skills.

The market for workplace learning was worth $362 billion worldwide in 2017, and Dey argues that this will soar in the coming years as companies are forced to retrain employees to keep up with advances in technology.

The education technology (edtech) sector, which includes approaches such as remote learning, online tutoring and the use of tools like virtual and augmented reality, is expected to benefit from this focus on training and upskilling. More than $8 billion was invested in these companies in the first 10 months of 2017.

But Dey argues that traditional ideas, such as face-to-face teaching and high-quality books and course materials, will remain important too. Indeed, he believes hybrid approaches may be the most successful, compared to either traditional or online alternatives alone.

For example, the educational technology company Jolt delivers teaching remotely and virtually via online tools and webcams, but its students learn together in a single physical space – a college classroom or a training room at one of their employers.

This combination of advanced technology and peer support could be the future of education, whether it is provided by employers or specialist education providers.

New types of housing

Property start-up Common offers co-living accommodation in US cities from New York to San Francisco, pioneering for what is expected to be a much more familiar type of housing in future.

Residents have a short-term lease on their own room, as well as access to a range of communal facilities where they mingle with fellow residents – from a large kitchen facility to a cinema in the basement.

The co-living concept remains niche – an experiment in communal living that is popular among mobile professionals, such as those moving to a new country. However, it reflects various changes in society – including both an increasing desire for a sense of community and the changing patterns of work.

 “We’re going to see a great deal more experimentation in housing, and a great deal more co-living,” says the London Business School’s Lynda Gratton. “Marriage is happening later, people are having fewer children, so being single will take up a bigger proportion of your life, and co-living may become a very important way of living for that particular age group.”

Under pinning the theme

Several factors underpin that theme. One is that the generation growing up in a digital era increasingly prioritises access to high-end technology at all times – high-spec, purpose-built, shared accommodation provides this. Also, in a labour market characterised by greater mobility, rented accommodation – perhaps shared with co-workers or other mobile employees – offers the increased flexibility that people need.

The co-living development sector is now one of the fastest growing areas of the real estate market, and companies are introducing schemes around the world. In the UK alone, the build-to-rent market, which includes co-living, is expected to expand from £25 billion in 2017 to £70 billion by 2022.

Manisha Patel, senior partner at the architectural firm PRP, sees co-living developing in several different ways. “The private rental sector will offer more and more buildings in which people live together in flats with shared facilities,” she says.

“We may also see more specialist housing for older people, where residents may be able to buy-in services personalised to their health needs."

Multi-generational housing

It’s often assumed that the main area of the housing market likely to be impacted by an increase in life expectancies is the specialist retirement property market. Many older people will be looking for homes designed with their needs in mind, or even with support and care available, in preference to a residential care home.

After a period of rapid growth, the UK’s retirement housing market is worth £29 billion, almost twice the size of the care home industry, according to data from Knight Frank. Other geographies are even more mature: while owner-occupied retirement housing represents just 2% of the UK’s housing stock, the comparable figure in the US is 17%, and 13% in Australia and New Zealand.

However, if new treatments to tackle chronic illnesses and conditions do eventually emerge, it could change the type of housing support we need as we get older.

Patel argues that we are likely to see a rise in multi-generational housing, when three, four or even five generations could live flexibly and support each other during different stages of life.

“This type of multi-generational living is happening all over the world – in the US, Canada, Australia, Japan, India, and even Eastern Europe,” says Patel.

In Japan, for example, it’s common to have different areas or storeys in one building catering to different generations – essentially one house on top of another house. “The older relatives that are less mobile live on the lower level, while younger members of the family live on the upper level, but the whole family can support each other in various ways.”

Indeed, while co-living – whether different generations of the same family or other social groups – has been viewed in many societies as a less attractive option, this may be about to change.

Matthew Taylor, Chief Executive of the Royal Society of Arts, says: “Models of co-living are growing and getting more attention because they can offer people, more affordable, more convenient and more enjoyable ways of living”.

The economic impact of longer living

The seismic shifts in demographics that are being triggered by improvements in health, higher life expectancy and fewer births could have fundamental implications for the global economy.

There are widespread concerns about the economic impact of ageing populations. However, if people are healthier for longer and able to remain in work, some experts argue that there could be benefits. With the right focus, moreover, this additional growth can be accelerated.

“Rising life expectancies mean long-term economic growth will probably increase,” says Antonio Garcia Pascual, Chief Economist, Europe, at Barclays. “Governments will collect more taxes and be able to spend more.”

But there could be other consequences. Changes to working patterns and more disruption in people’s lives, perhaps due to more periods in and out of work, may lead people to save more and borrow less, with a knock-on effect on monetary policy.

“As a population ages, savings tend to rise and that brings down interest rates,” says Pascual. “That’s one reason why we are already seeing central banks struggling to lift interest rates; the long-term equilibrium rate is being dragged down by population dynamics.”

Living longer may necessitate increased savings, but a higher savings ratio leads to falling investment returns.

“If people are going to live until they’re 120 or 130, say, they have to ask themselves how they will pay for those extra years of life,” says Jim Mellon. “One of the best ways of doing it is to invest in the very things that are going to keep them alive for longer.”

Mellon is particularly interested in the businesses and projects related to finding drugs and therapies that target ageing itself, rather than diseases related to ageing, where most of the gains to date have been made.

He points to rapid development in research into extending longevity – and the potential for harnessing AI to accelerate drug discovery, as well as trials and testing. “We are going to see billions of dollars coming into this sector, which is really quite nascent,” says Mellon. “There are very few companies available to the general public today, but there will be hundreds lining up over the next two or three years.”

This is not to suggest the answer for savers and investors planning for retirement is to stake everything on biotechnology research. As we have seen, the confluence of rising life expectancy and the revolution in digital technology will have impacts across many sectors.

From healthcare to property, and from education to technology, there will be direct beneficiaries from the transformation of our society; these businesses may offer an interesting place to start for those investing for tomorrow.

What does living beyond 100 mean for your wealth and investments?

If the next generation routinely lives beyond 100, it is likely to be the result of a huge leap forward in healthcare. These advances will continue as technology, and in particular machine learning, transforms medicine in profound ways. But this won’t be the only area of our world to change.

The lives of the next generation will also be shaped by AI. The impact of these two trends could have huge implications for the economy, work, housing and education, as the next generation embraces a more flexible and adaptable attitude to work.

Barclays Private Bank can help you take advantage of complex new trends shaping the global economy, ensuring that you are making the most of your wealth and investments.

“We are seeing key innovative technologies, including AI, quantum computing and bioscience affecting day-to-day life for individuals, small businesses, large corporates and governments,” says Barclays Private Bank CEO Karen Frank.

“As these technologies become more established and embed themselves into society, a new operating system for the planet starts to emerge. Barclays can help you to understand what this will mean for you, business, and society in 2019 and beyond.”

We leverage expertise across the whole Barclays group, including its corporate and investment banking operations, giving us access to a huge range of insights and expertise. Our researchers can also draw upon a global network of experts and innovators, and are constantly looking for emerging themes and new opportunities.

Our team-based approach, brings together investment and credit specialists, wealth advisers, philanthropy experts, specialist solution teams and many others to help clients make the right decisions.

“Barclays has a long history supporting innovation,” says Frank. “It is ingrained in our DNA and will help our clients navigate the opportunities innovation presents, now and in the future.”

This communication is for Barclays Private Bank customers only. Any views expressed may differ from those of Barclays. All opinions and estimates are given as of the date hereof and are subject to change. No representation is made as to the accuracy of the assumptions made within. Barclays is not responsible for information stated to be obtained or derived from third party sources or statistical services.

Barclays is not offering to sell or seeking offers to buy any product or enter into any transaction.  Any offer or entry into any transaction requires Barclays’ subsequent formal agreement which will be subject to internal approvals and execution of binding transaction documents. Neither Barclays nor any of its directors, officers, employees, representatives or agents, accepts any liability whatsoever for any direct, indirect or consequential losses (in contract, tort or otherwise) arising from the use of this communication or its contents or reliance on the information contained herein, except to the extent this would be prohibited by law or regulation.

Barclays is not obliged to inform the recipients of this communication of any change to such opinions or estimates. THIS COMMUNICATION IS PROVIDED FOR INFORMATION PURPOSES ONLY AND IT IS SUBJECT TO CHANGE. IT IS INDICATIVE ONLY AND IS NOT BINDING.

Barclays offers private and overseas banking, credit and investment solutions to its clients through Barclays Bank PLC and its subsidiary companies. Barclays Bank PLC is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (Financial Services Register No.122702) and is a member of the London Stock Exchange and NEX. Registered in England. Registered No. 1026167. Registered Office: 1 Churchill Place, London E14 5HP.