Many look at global population growth as a given to greater consumption…and looking at the chart below of total global population set to hit 7.8 billion by 2020, one might be forgiven for this viewpoint. However, the reality, when one looks into the numbers, is that growth in global consumption has ended, as I recently detailed, Investing for the “Long Run”? You May Want to Consider This
. This article explains why this population growth will no longer equate to economic or consumptive growth.
0 to 64 year old Global Population
The 0 to 64 year old global population is about 7 billion persons, as of 2018. The chart below shows the distribution and changing size of that population from 1950 through 2050 by high income (black line…$12,000+ income per capita including the US/Canada, most of Europe, Japan, Aus/NZ, etc.), upper middle (yellow line…$12,000 to $4,000 per capita income including China, Russia, Brazil, Turkey, Mexico, Thailand, Columbia, etc.), lower middle (red line…$4,000 to $1,000 per capita income including India, Indonesia, Pakistan, Bangladesh, Ukraine, Philippines, Egypt, etc.), and low income nations (blue line…less than $1,000 in per capita income including most of sub-Saharan Africa, Afghanistan, Haiti, etc.). The simple takeaway should be that the 0 to 64 year old populations among the high and upper middle income countries have ceased growing and will now be shrinking, indefinitely. All 0-64 year old population growth from now forward will be among the lower middle and low income nations of the world. So what?
Income by Age of Head of Household
Why the focus on 0 to 64 year old populations? Average income and expenditures vary greatly by the age of the head of household.
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