Greying world: Aging risk saps economic growth

Aging workers: Office workers crossing an intersection in Tokyo. The working-age population in Japan began to shrink in 1996, now even its total population. – Bloomberg

THE world’s population will rise to 9.7 billion by 2050. For much of post-WWII, global population growth averaged annually at about 2%.

It has started to fall and is now running at its lowest rate in the new millennium, down to about 1%. This is already undermining potential economic growth – estimated as increase in WAP (the working-age population, aged 15-64) plus growth in productivity (output per worker). Global growth has been trending south since – now at just under 2.5%, against the long-term pre-crisis trend average of 3.5%, reflecting slackening growth in WAP since 2005 to 1%, from 1.8%.