Sta Hungry Stay Foolish

Stay Hungry. Stay Foolish.

A blog by Leon Oudejans

Demographics

The UN still projects that “The world’s population is expected to increase by nearly 2 billion persons in the next 30 years, from the current 8 billion to 9.7 billion in 2050 and could peak at nearly 10.4 billion in the mid-2080s.” Early 2023, China admitted a population decline (eg, CNN, DW, Reuters).

In Europe, the average fertility rate in 2022 was at or below 1.8, except for Monaco (ie, 2.09). The minimum fertility rate to sustain a society is 2.1 (source). Hence, European populations will decline without (i) an increase in the average life expectancy, and/or (ii) an increase in immigration.

The blue lower line in the diagram (left) shows the 2005-2010 fertility rates (2.5 on average) compared to the 2015 minimum fertility rate (ie, 2.3).

Hence, we were already approaching the tipping point at which the global population will decline.

The minimum fertility rate decreased from 2.3 (2015) to 2.1 (2023) following an increase in life expectancy (eg, healthcare).

The theoretical absolute minimum should be 2.0.

The chart above is before the 2019 coronavirus pandemic and before the 2021-2023 inflation surge. The former killed about 20 million people (c. 0.25%), and/but the latter will decrease the fertility rate because raising children is getting too expensive (eg, Brookings-2022, CNN-2022).

Perhaps, the UN is still not lowering its global population projections because it prefers our fear over our hope. I suppose that all UN global disaster warnings are related to fear, eg. climate change, food, water. Indeed, it’s quite likely that people would lose interest in those regular warnings (without fear).

The consequences of the above are huge, both at customer level (micro) and for society (macro):

  • Macro: mainly supply & volume-driven, like:
  • lack of workers (eg, healthcare, police, soldiers);
  • substitution of soldiers (eg, drone warfare);
  • closure of retail outlets due to lack of workers;
  • need for city redesign (eg, vacant buildings).

To some extent, migrant workers will continue to fill some of the gaps (eg, Philippine nurses). However, the population decline will not be limited to Europe. At some point in time, Africa and Asia will need their own people to fulfill local demand. I suppose that will take several decades.

The above may seem farfetched to you. In my view, it’s about reality in the Netherlands. Several weeks ago, I even noticed a big advertising banner on a roadhouse restaurant above the busiest Dutch motorway, inviting applicants to just walk-in and have an immediate job interview.

Soon after my 1981 graduation from the Amsterdam business school, I received about a 100+ job offers from companies. Within several years, the tables had turned in favour of employers. I doubt any employer is prepared for what’s coming. Soon, you’ll read a lot on the upcoming demographic crisis.

No Help Wanted (1952) by The Carlisles
artists, lyrics, video, Wiki-artist, Wiki-song

Note: all markings (bolditalicunderlining) by LO unless in quotes or stated otherwise.

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