The future may be hard to predict and sometimes we guess wrong. However, there is one trend that will have a big impact on everyone’s business for not only the next few years, but possibly the coming decades. One thing that we cannot deny is that tomorrow, we will be older than we are today. Changes of demography can have very important political, economic and military consequences.
Let’s take a look at Europe and Japan first. Recent statistics are showing that populations in these two countries are having fewer children – they are also facing a distressing level of youth unemployment. Some worrisome implications of this is a less experienced workforce that will need to financially support a larger elderly population. Meanwhile, Europe is having a huge migration crisis. Who will make it to Europe, where will they settle?
Competitiveness will be at a high in mature economies like Japan and the United States. The workforce will be older, healthcare costs will be higher and there will probably be less pension benefits.
I know what you’re thinking – “What about China?” Many analysts have been betting that China will take up the demographic slack and be the growth engine of the future, but that is not the case. Sure, right now Chinese citizens are relatively prosperous, but China’s one child policy is beginning to take its toll. The smaller number of the next generation is going to have to support a much larger pool of aging citizens, just how it is in developed countries. The Middle Kingdom still accounts for a large proportion of the world’s population and mainland China will still fuel world growth economically. However, the pace of this growth will vary province by province.
As you can already see, companies will need to be creative and find new innovative business models that can take advantage of the shifting demographics of their operating countries’ populations.
The growth in the world will come from countries like India and Africa – this is where the big opportunities lay. Over the next decade, African economies such as Ethiopia, Tanzania and Mozambique are predicted to grow as fast or even faster than some recent Asian countries. However, we must keep in mind that problems like corruption, political instability, poor education and lack of infrastructure could slow or limit growth.
Overall, these shifts in demography will not cause a decline by any means. There will be room for new business opportunities across industries, especially healthcare.