Today’s Tuesday Reading is from Jack Wolfe, MOR Associates Senior Consultant and Executive Coach. Jack may be reached at [email protected].
In 1900, life expectancy at birth in the U.S. was 47. In 2000, just 100 years later, it was 77, up 30 years – WOW! That’s a 6%+ increase per decade, driven by factors including the increase in health care quality, healthcare coverage, and the reduction in smoking starting in the mid-1960s (1960 – 42% of the U.S. population smoked; in 2000, 23%; by 2024, only 12%). In 2025, the average U.S. life expectancy is up only slightly to 79.4 years (Opioids and COVID hurt). Women are far ahead, averaging 81.1 years, and men averaging 76.1 years
At age 87, I have a deep interest in life expectancy, particularly that of my wife, Ancelin and myself. Thus, when Goldman Sachs (GS) published their report, The Path to 2075 – The Positive Story of Global Aging, in late May, I read it immediately and thought many of you might like to see a few excerpts.
What might we do with this information? First, let’s look at a few summarized population demographics changes, worldwide, and then in the U.S., and ask what those changes could mean…
The first piece of worldwide good news is that, per the UN, we are nowhere near done growing – today, in 2025, our world population is estimated to be 8.2B, and projected to peak at 10.3B in the mid-2080s, and decline thereafter, hitting 10.2B in 2100. A few items of note:
- Today, China and India each have populations of about 1.4B. Together, they constitute about 35% of the world’s current population.
- China’s population may just have peaked, and its very low fertility rates (1.1-1.3) project that its population will be half or less by 2100 (500M-700M).
- India, in contrast, will continue to grow to 1.7B in the 2060s, and then decline somewhat to 1.5B in 2100. At that point, it is likely to be 2.5X China’s size.
- Africa is a continent to watch – its population today is 1.6B and is projected (UN) to be about 4.0B in 2100. This means that Africa is essentially all of the world’s growth, offsetting some of the world’s losses.
- And there are losses – Europe will drop from 440M now to 420M in 2100, but certain countries (Italy, Spain, Greece, Ukraine, Russia, etc.) may see drops in the 30%-50% range. Japan will lose nearly 50% of its 125M population by 2100. Brazil will drop from 215M to 170M in 2100. By 2100, only 12 countries are expected to have a fertility rate greater than 2.1, the replacement rate.
As a world, we’re growing noticeably older. Part of that is our substantially increased life expectancy. Severely declining fertility rates (number of children born to a woman) have also set in. In 1965, the world fertility rate was 5.09; in 2000, it was 2.75; in 2023 it was 2.25. That’s a 55% decline in just 60 years. Thus, we have far fewer young people as a percentage of our global population mix, raising the average age. Additionally, over the past 50 years, average life expectancy has increased in developed economies from 72 to 82 years. In emerging economies it’s somewhat younger, but still increased 58 to 73 years. Further, only 10% of the world population is over 65 today; in 2100, that will be 25%. In the U.S., nearly 20% of our population is now over 65. That will be 29% by 2100. During that same period, the mean U.S. age will rise from 39 to 48. Yes, our world is aging, and doing so quickly.
Net population growth is still occurring as much longer life expectancies offset our declining fertility rates, but there are still substantial pockets of loss, primarily in developed countries. And, we are aging, substantially. What should we examine in the face of these issues? Let’s look at three- migration, far more aged, and far fewer children:
Migration – Today, the U.S., Europe, China and Japan constitute about 65% of today’s world GDP of $113T, but only 28% of the world’s population of 8.2B. The U.S. and Europe have essentially flat populations until 2100; China’s and Japan’s populations will fall precipitously. All four, in varying degrees, are resistant to immigration. Consumer spending is the biggest ingredient in GDP in three of these four, and a substantial one in China, the fourth. When faced with the choice of immigration versus reduced GDP (aka standard of living), my bet is the doors will open to immigration.
Far More Aged – In the U.S., the population over the age of 65 rose from 35M to 68M from 2000 to 2025, both because so many baby boomers became 65, and life expectancy continued to grow. In the rest of the developed or developing world, it is less dramatic, but similar trends are underway. What is happening to the financial requirements for Social Security, Medicare, etc., and their worldwide equivalents? What is happening to the need for geriatric medical care, and geriatric housing, again worldwide? These will require shifting governmental resources from other activities (defense, social welfare, education, etc.) to the elders – there are lots of them, and they do VOTE!
Far Fewer Children – In 2007, we were at the replacement rate, 2.09. Then, during the Great Financial Recession, birthrates dropped rapidly to 1.6, a 23% decrease. That drop has sustained for the last 15 years. The GS report and the Census Bureau both agree that it will continue indefinitely. Working women chose fewer children, and we are now a nation of two-income families. What does that mean for elementary education, high school education, and college education? Across the nation, varying a bit by region, we will see fewer schools, fewer teachers, and a much smaller educational GDP. Will this apply equally to pediatricians, toy sales, Boy Scouts and Girl Scouts – yes, and to a myriad of other markets. It will be transformative in reducing spending on our youth.
I am not sure how much of it I will see, but most of you will see 40-50 years worth. It will be exciting and educating to monitor how population demographics continually shift. All the best to you and your families.
How much time do you feel you invest in understanding population demographics?
Last week we asked which element of strategy and culture you could benefit from focusing on more:
- 31% said why
- 26% said how
- 25% said what
- 17% said when
Whatever you are trying to enlist others in, helping them understand why it is such a critical step. When we understand why something is a priority, we are much more likely to see it as a priority. That, of course, depends on having a clear sense of what it is we are pursuing and how we can make it happen.