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IPFS News Link • Economy - Economics USA

2010 to 2030: Demographics and the Fate of Nations

"The risk of social and political upheaval could grow throughout the developing world – even as the developed world's capacity to deal with such threats declines." From the fall of the Roman and the Mayan empires to the Black Death to the colonization of the New World and the youth-driven revolutions of the twentieth century, demographic trends have played a decisive role in many of the great invasions, political upheavals, migrations, and environmental catastrophes of history. By the 2020s, an ominous new conjuncture of demographic trends may once again threaten widespread disruption. We are talking about global aging, which is likely to have a profound effect on economic growth, living standards, and the shape of the world order. For the world's wealthy nations, the 2020s are set to be a decade of rapid population aging and population decline. The developed world has been aging for decades, due to falling birthrates and rising life expectancy. But in the 2020s, this aging will get an extra kick as large postwar baby boom generations move fully into retirement. According to the United Nations Population Division (whose projections are cited throughout this article), the median ages of Western Europe and Japan, which were 34 and 33 respectively as recently as 1980, will soar to 47 and 52 by 2030, assuming no increase in fertility. In Italy, Spain, and Japan, more than half of all adults will be older than the official retirement age – and there will be more people in their 70s than in their 20s. Falling birthrates are not only transforming traditional population pyramids, leaving them top-heavy with elders, but are also ushering in a new era of workforce and population decline. The working-age population has already begun to contract in several large developed countries, including Germany and Japan. By 2030, it will be stagnant or contracting in nearly all developed countries, the only major exception being the United States. In a growing number of nations, total population will begin a gathering decline as well. Unless immigration or birthrates surge, Japan and some European nations are on track to lose nearly one-half of their total current populations by the end of the century.