Changing Population Age Structures and Sustainable Development

Report of the Secretary-General to the 50th session of the Commission on Population and Development

(E/CN.9/2017/2)

Population Division, DESA, United Nations

New York, 3 March 2017

Outline

Changing population age structures Global and regional trends Age structures in urban and rural areas Fertility, health and education Individual and household-level intergenerational support Changes in inter-generational co-residence Gender, balancing work & family obligations Consequences for the population and the macroeconomy Work, pensions and old-age income security Macroeconomic implications Conclusions and Recommendations

Changing population age structures

World population ageing is intensifying

Percentage distribution of global population by broad age group, 1980 to 2050

Source: World Population Prospects: The 2015 Revision.

Percentage distribution of the populations of major world regions by broad age group, 1980 to 2050

35

26

21

45

41

32

38

24

18

22

16

15

40

26

17

23

19 17

30

23

20

19

16

14

19

19

18

20

16

12

16

11 10

20

17

12

19

14 12

18

15

13

40

49

49

33 36

44

38

52

51

49

56

47

36

49

51

47

53

48

44

50

48

6 8

16

3 3 6 4

8

18 12

18

28

4 8

20

11 15

23

8 12

18

0

10

20

30

40

50

60

70

80

90

100

1980 2015 2050 1980 2015 2050 1980 2015 2050 1980 2015 2050 1980 2015 2050 1980 2015 2050 1980 2015 2050

World Africa Asia Europe Latin America andthe Caribbean

Northern America Oceania

65+

25-64

15-24

0-14

Source: World Population Prospects: The 2015 Revision.

Children (aged 0-14) and youth (15-24)

• Children and young people globally projected to rise slightly in future decades, while falling as a share of the total population;

• The continued increase in the number of children and youth worldwide is due mainly to growth in Sub-Saharan Africa, with smaller positive contributions by Northern America and Oceania;

• Declining numbers of children and youth in Asia, Europe and Latin America and the Caribbean. Globally, 2.1 billion children and 1.3 billion youth by 2050

Working-age population (aged 25-64)

• The world’s working-age population (WAP) is projected to increase by about 31 per cent, from 3.6 billion in 2015 to 4.8 billion in 2050. Most of this increase is expected to occur in Africa (+653 million) and in Asia (+440 million);

• Asia will continue to have the largest regional share of the WAP, but this figure will drop from 62 per cent in 2015 to 57 per cent in 2050. At the other extreme, Europe’s WAP is expected to start declining after 2015;

• Countries with large net inflows of migrants can attenuate, but not neutralize, the trend toward population ageing. Old-age dependency ratio of developed countries 4 per cent higher if trends in international migration continue to 2050 (United Nations, World Migration Report 2015).

Older persons (aged 65 or older)

• Older persons expected to increase 2.6-fold, from from 608 million in 2015 to nearly 1.6 billion by 2050, more than tripling in Asia, Latin America and the Caribbean and Africa. Older people will more than double in Oceania, and grow between 44% and 50% in Northern America and in Europe;

• The proportion of people aged 65 or over, the median age or the old-age dependency ratio yield broadly similar trends in ageing. Alternative measures of ageing that consider the average number of remaining years of life rather than the years already lived , give a different perspective. Such “prospective” measures of ageing, suggest much slower speed of ageing (Sanderson and Scherbov, 2015, 2016).

Older persons (aged 65 or over)

• Increasing evidence of improvements in cognitive ability, overall health status, and potential productivity (Skirbekk, 2016) over the range of adult ages. A major implication is that population ageing need not have the dire socio-economic consequences that are often attributed to it.

• Another important feature is the female predominance in the older population. In 2015, women accounted for 55 per cent of the global population aged 65 or older, and for 61 per cent of those aged 80 years or older (percentages highest in Europe, followed by Latin America and the Caribbean, Northern America and Africa, and Asia and Oceania)

Fertility, health and education

Association between education and fertility remains strong, but varies internationally

Source: Pradhan (2016)

Association of fertility with health less strong, but often positive Overall association between fertility and human capital significant

Individual and household-level intergenerational support

Changes of living arrangements of males between 1980s and 2000s in 27 countries (per cent)

-15

-10

-5

0

5

10

15

00

- 0

4

05

- 0

9

10

- 1

4

15

- 1

9

20

- 2

4

25

- 2

9

30

- 3

4

35

- 3

9

40

- 4

4

45

- 4

9

50

- 5

4

55

- 5

9

60

- 6

4

65

- 6

9

70

- 7

4

75

- 7

9

80

+

with parent with spouse with children alone

Ch

ange

s o

f liv

ing

arra

ngm

ent

bet

wee

n 1

98

0s

and

20

00

s (p

er c

ent)

Males

Age

Source: Estimates provided by Albert Esteve (2016)

Changes of living arrangements of females between 1980s and 2000s in 27 countries (per cent)

Source: Estimates provided by Albert Esteve (2016)

-15

-10

-5

0

5

10

15

00

- 0

4

05

- 0

9

10

- 1

4

15

- 1

9

20

- 2

4

25

- 2

9

30

- 3

4

35

- 3

9

40

- 4

4

45

- 4

9

50

- 5

4

55

- 5

9

60

- 6

4

65

- 6

9

70

- 7

4

75

- 7

9

80

+

with parent with spouse with children alone

Ch

ange

s o

f liv

ing

arra

ngm

ent

bet

wee

n 1

98

0s

and

20

00

s (p

er c

ent)

Age

Females

Proportion living independently (alone or with spouse only), persons aged 60 years or over by sex: world and development regions

circa 2005

11 16

9 3

29

58

20

9

0

10

20

30

40

50

60

70

80

World Moredeveloped

regions

Less developedregions

Leastdevelopedcountries

Perc

enta

ge

Men

Living alone Living with spouse, no children

19

33

10 8

22

37

16

5

0

10

20

30

40

50

60

70

80

World More developedregions

Less developedregions

Least developedcountries

Women

Living alone Living with spouse, no children

Source: United Nations (2015) World Population Ageing 2015

Gender and balancing work-family obligations

• •

• Over the demographic transition, women have fewer children, later in life, and often increase their labour force participation;

• Generally positive changes, but also a “sandwich generation” affecting mostly women who care for children and elderly parents, while also being more active in the workforce;

• Increasing evidence of the large contribution of women to market and non-market production: In Senegal, women contribute 87% of all household production and 58% of total aggregate work. In Mexico, household production (mostly by women), is nearly 22% of GDP (Donehower, 2016). In Brazil, women’s household work (but not men’s) tends to increase when they marry and when they have children (Wajnman, 2016);

• Policies to support women’s labour force participation, parental leave for both father and mother, as well as affordable child care and long-term care for the elderly, can help to reduce gender inequalities, and ease the fiscal pressures of population ageing

Macroeconomic implications

Era of increasing global labour supply is ending

Two main factors: 1. Falling total labour force participation rates at the world

scale, and in some of the major economies of the world, including China, India, Japan and the Unites States (World Bank, 2017)

2. Stabilization and start of the decline of the share of the working-age population as a share of the world total

Era of increasing global labour supply is ending

Source: World Population Prospects: The 2015 Revision

30

35

40

45

50

55

60

65

1980 1990 2000 2010 2020 2030 2040 2050

Shar

e o

f th

e p

op

ula

tio

n a

ged

25

-64

ye

ars

(pe

rce

nta

ge)

World

Africa

Asia

Europe

LatinAmerica andthe Caribbean

NorthernAmerica

Oceania

Year

Evidence on the demographic dividends

• Countries in Africa, and some in Asia and Latin American and the Caribbean in the early intermediate stages of the demographic transition, will see increasing economic support ratios (positive “first demographic dividend”) through 2050;

• Countries with declining support ratios include China, Germany, Italy, the Republic of Korea, Spain, Slovenia and Thailand, where support ratios could decline by 0.5 per cent or more per year over 2015-2050;

• A “second demographic dividend” can remain positive long after the first dividend phase has elapsed.

Evidence on the demographic dividends

• Recent international evidence suggests that:

1) The “window of opportunity” for the demographic dividends opened in earlier Europe, then in Asia, Oceania and the Americas, and later in Africa;

2) The largest (peak) annual increases in economic growth (demographic dividends) estimated in Asia (2.3% per year), owing to the region’s rapid demographic transition and major investments in education. In other regions, the estimated peak dividends range from 1.5% to 1.8% per year;

3) Africa’s demographic transition is delayed and projected to be slower than other developing regions, but it could end up reaping the largest total (long-term) demographic dividend;

Evidence on the demographic dividends

4) The second demographic dividend estimated much larger and longer lasting than the first, but its realization is less certain, as is conditional on access to SRH care services, investment in human and physical capital, and productive employment available during the dividend period. This would be consistent with the successful implementation of the 2030 Agenda for Sustainable Development in developing countries, but it is not a foregone result

Conclusions and recommendations

• Demographic transition virtually universal, but its timing, speed and its implications for sustainable development vary greatly across countries and regions

• Globally, slower growth in the number of children and youth, turned negative in more countries and regions, presents a historic opportunity to invest in human capital (health and education) and productive employment. Governments should actively pursue these opportunities for their intrinsic value in fulfilling basic rights, and as an investment in future economic growth and in the well-being of present and future generations

Conclusions and recommendations

• Countries with high fertility and youthful populations to prioritize support for universal access to sexual and reproductive health care services, in accordance with the Programme of Programme of Action of the ICPD and the goals and targets of the 2030 Agenda for Sustainable Development;

• Governments to pro-actively pursue reforms of social security systems, including increases in the age of retirement in proportion to life expectancy, among other measures to ensure income security in old-age and fiscal sustainability, with due attention to gender equity;

• Ensure social protection floor through universal pensions; • Gender imbalances in family and work obligations call for policies to

support affordable child-care programmes, paternal and maternal leave, part-time and flexible employment opportunities for both men and women, and long-term care programmes

• Policies to promote accumulation of personal assets and physical capital through the older ages can enhance the demographic dividend

Thank you