REPLACEMENT RATIO

March 15, 2021


You probably will not appreciate the term replacement ratio when I tell you it applies to “fertility rates”.  If we look at death rate vs the birth rate, we see several very troubling trends.  I want to mention the idea for this post came from the pod cast “CALM CASH”.  Calm Cash is written, produced, and broadcast by Ben Jackson.  It’s an excellent source of information on several topics but specifically how to invest wisely.  Several facts for this article also came from a post written by James Gallagher. Mr. Gallagher works for the BBC and is the Health and Science Correspondent for them.

Let’s now define the term fertility rates:

The fertility rate, at a given age, is the number of children born alive to women of that age during the year as a proportion of the average annual population of women of the same age. If you want information relative to rates for each country the very best source is the CIA Information fact book at https://www.cia.gov/the-world-factbook/.  It has a wealth of information on each country.

If the fertility rate number falls below approximately two point one (2.1), the size of the population for any one country or region starts to fall. In 1950, women were having an average of four point seven (4.7) children in their lifetime.  Researchers at the University of Washington’s Institute for Health Metrics and Evaluation showed the global fertility rate nearly halved to two point four (2.4) in 2017.  Their study, published in the Lancet, projects it will fall below one point seven (1.7) by 2100.  So, why is the two-point one threshold important? You might think the number should be two (2.0) – two parents have two children, so the population stays the same size.  But even with the best healthcare, not all children survive to adulthood. Also, babies are ever so slightly more likely to be male. It means the replacement figure is two-point one (2.1) in developed countries.  Nations with higher childhood mortality also need a higher fertility rate.  The graphic below will indicate the projection.

OH, by the way, 2100 is this year.  As a result of the falling rates, researchers who keep track of such things expect the number of people on the planet to peak at nine point seven (9.7) billion around 2064, before falling down to eight point eight (8.8) billion by the end of the century.  When I first became aware of this fact, my reaction was—what’s the big deal?  Is this not a good thing?  When you look at trying to feed the world’s population you see right now that’s a huge problem in some countries.  Also, think of the worlds’ diminishing resources, water being the most scarce.  So, what is the problem?

“That’s a pretty big thing; most of the world is transitioning into natural population decline,” researcher Prof Christopher Murray told the BBC. “I think it’s incredibly hard to think this through and recognize how big a thing this is; it’s extraordinary, we’ll have to reorganize societies.”

It has nothing to do with sperm counts or the usual things that come to mind when discussing fertility.  Instead, it is being driven by more women in education and work, as well as greater access to contraception, leading to women choosing to have fewer children.  In many ways, falling fertility rates are a success story.  But as we look closer; we might become somewhat alarmed.  The graphic below will tell more of the story.

Japan’s population is projected to fall from a peak of one hundred and twenty-eight (128) million in 2017 to less than fifty-three (53) million by the end of the century.  Italy is expected to see an equally dramatic population crash from sixty-one (61) million to twenty-eight (28) million over the same timeframe. They are two of twenty-three (23) countries, including Spain, Portugal, Thailand and South Korea, expected to see their population more than halve. “That is jaw-dropping,” Prof Christopher Murray said.   China, currently the most populous nation in the world, is expected to peak at one point four (1.4) billion in four years’ time before nearly halving to seven hundred and thirty-two (732) million by 2100. India will take its place.  The UK is predicted to peak at seventy-five (75) million in 2063, and fall to seventy-one (71) million by 2100.

This fall in fertility produces an “inverted age structure”.  This inverted age structure (more old people than young people) and all the uniformly negative consequences of an inverted age structure,” is the real problem says Prof Murray. 

The study projects:

  • The number of under-fives will fall from six hundred and eighty-one (681) million in 2017 to four hundred and one (401) million in 2100.
  • The number of over eighty (80)-year-olds will soar from one hundred and forty-one (141) million in 2017 to eight hundred and sixty-six (866) million in 2100.

Prof Murray adds: “It will create enormous social change. It makes me worried because I have an eight-year-old daughter and I wonder what the world will be like.” Who pays tax in a massively aged world? Who pays for healthcare for the elderly? Who looks after the elderly? Will people still be able to retire from work?

Prof Ibrahim Abubakar, University College London (UCL), said: “If these predictions are even half accurate, migration will become a necessity for all nations and not an option.  “To be successful we need a fundamental rethink of global politics.  “The distribution of working-age populations will be crucial to whether humanity prospers or withers.”

I personally think this just might be crisis greater than global warming or sustainability.

What do you think?

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