1/27/2005

The Aging Population

All around the world a big percentage of the workers is reaching retirement age, and there are less people to fill the jobs as they become open. A few of the articles that I read suggest that because of the decline in the number of workers, the world's economy is going to decline. In an article titled "Productivity Can Make Up the Gap" http://yahoo.businessweek.com/magazine/content/05_05/b3918035.htm
the authors suggest that just because there is a declining number of workers, the world's economy can still grow. According to the acticle the average productivity in Japan, per worker, has increased 2% each year since 1980. If the trend continues productivity will rise 169% by 2050, raising Japan's GDP by 72%. I would tend to agree with the latter article, if countries can increase productivity then the world's economy will continue to grow steadily, even with fewer workers. For productivity to increase countries needs to provide education and encourage innovation.

3 comments:

Lana said...

Even though there more workers retiring than there are workers working, I don't think the world's economy will decline either. Maybe in the short-run we will see some negative results from having less workers, but we are an innovative people, and we'll find a way to make up where we lack.

Marie said...

I think that there is almost a trap that this country has gotten its self in. We contiually have to purchase more goods. Young couples need a new houses and cars as opposed to the retiring generation who worked years to obtain. Our generation is also creating a lot more debt per individual than the past generations would have even dreamed of. All of this purchasing and debt means that both individuals in a relationship have to work, as in the past the majority of men worked. People are alos working longer harder hours, and at times more than one job. I think it is true, as long as we can keep this country educated and innovative we will remain strong.

Dr. Tufte said...

-1 for a poorly formatted link in Ann's post (waived)

-1 for spelling mistakes in Ann's post (waived)

Worrying about something like this (which is fairly common) is putting the cart before the horse. Our population is aging because it can - improvements in medical productivity have led to increased longevity. Our older population is retiring because they can - improvements in productivity have allowed them to save more.

It is incorrect that people are working more. The evidence simply does not support this. Yet, it is a common fib that we tell each other. Yes, more people are working outside of the home, but that is a tradeoff for working less in the home.