Demographics will always reshape the medium-term future because the change in economically productive populations is already determined. For example, most people who will be alive in 2050 have already been born. It is a fundamental fact of predictions that is often overlooked.

     In the picture above: Green = working age, Blue = Young, Pale green = aging & Orange = Old. The three maps are 1990, 2023 and 2050.

     Historically, the world’s dominant powers have benefited from large working-age populations that help drive economic growth. In the past, these populations have been augmented by conquest and slavery, which helped prolong dominance. However, domestic demographics will always determine that dominance in the end. Today is no exception.

     Japan had the first major shift: By 2013, a quarter of the population was 65 and older, making Japan the oldest large country ever. Soon, much of Western Europe will follow, with record old-age populations; South Korea, Britain and Eastern Europe will be next, along with China.

     At the same time, many low-income developing countries today will have huge prime-age labor forces in the near future. Can they take advantage of the opportunity?

     Europe is shrinking. China is shrinking and India, a much younger country, this year became the world’s most populous nation. But what we’ve seen so far is just the beginning.

     The projections are reliable, and stark: By 2050, people age 65 and older will make up nearly 40 percent of the population in some parts of East Asia and Europe. Extraordinary numbers of retirees will be dependent on a shrinking number of working-age people to support them. In all of recorded history, no country has ever been as old as these nations are expected to get.

     As a result, experts predict, things many wealthier countries take for granted, like pensions, retirement ages and strict immigration policies, will need major overhauls to be sustainable. And, almost inevitably, today’s wealthier countries will make up a smaller share of global G.D.P.

     In many respects, the aging of the world is a triumph of development. People are living longer, healthier lives and having fewer children as they get richer.

     The opportunity for many poorer countries is enormous. When birth rates fall, countries can reap a “demographic dividend,” when a growing share of workers, and fewer dependents, fuel economic growth. More women tend to enter the work force, compounding the economic boost.

     “All of these changes should never surprise anyone, but they do,” said Mikko Myrskylä, director of the Max Planck Institute for Demographic Research. “And that’s not because we didn’t know. It’s because politically it’s so difficult to react.”         

     However, demography isn’t destiny, and the dividend isn’t automatic. Without jobs, having a lot of working-age people can drive instability, rather than growth. Without the right policies, a huge working-age population can backfire rather than lead to economic growth. If large numbers of young adults don’t have access to jobs or education, widespread youth unemployment can threaten stability as frustrated young people turn to criminal or armed groups for better opportunities.     

     “Demography is the raw material. The dividend is the interaction of the raw material and good policies”, according to Philip O’Keefe, who directs the Aging Asia Research Hub at the ARC Center of Excellence in Population Aging Research and previously led reports on aging in East Asia and the Pacific at the World Bank.

     Change will not come easily. More than a million people have taken to the streets in France to protest the relatively modest change of raising the retirement age to 64 from 62.

     “Much of the challenge at the global level is the question of distribution,” Dr. Myrskylä said. “Some places have too many old people. Some places have too many young people. It would make enormous economic sense to open the borders much more but, politically, that would be incredibly difficult.”

     “You can say with some kind of degree of confidence what the demographics will look like,” Mr. O’Keefe said. “What the society will look like depends on policy choices and behavioral change.”

     Sobering thoughts that current politicians in most countries prefer to ignore, but they do so at the risk of future instability and possible chaos.

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