Demography

A declining population and plummeting fertility rate isn’t a unique Japanese phenomenon. All rich countries will contend with this crisis.

The world has an obsession with Japan’s shrinking population. Each year, news that the country is a little bit smaller can reliably be called upon for column inches, which tend to examine it as a Japanese mystery — one of those inherently Oriental concepts that foreigners could not possibly penetrate, like wabi-sabi or the bushido code of samurai warriors.

The New York Times asked in 2012, “Without babies, can Japan survive?” The Atlantic wrote about “the mystery of why Japanese people are having so few babies.” To be fair, Japan talks about the population crisis as much as anyone, with one paper recently calling for the declaration of a “declining birth-rate state of emergency.”

“We are on the verge of something fundamentally different right now, yes. But a lot of it looks more like the world before 1945 than the world of the future.” There is good news coming out of the global population collapse.

A little while back, a friend introduced me to the work of developmental economist Peter Zeihan. He identifies as a socially conservative libertarian but seems to be slightly further to the left than that. His science is spot on and he presents it in a way that’s agenda-free. He tells it like it is, is known for his accurate forecasts, and I think we need to listen to him. Here is a recent and very concise presentation of his scholarship.

Billionaire iconoclast Elon Musk had it right when he told a Wall Street Journal forum last week: “One of the biggest risks to civilization is the low birth rate and rapidly declining birthrate.”

Between now and the end of the century, declining fertility (or Demographic Winter) will have an impact few can imagine.

What does Russia want with Ukraine? Most would say to keep NATO off its southern border or for the nation’s rich natural resources. That’s true, in part. But there’s a very big something else.

A new study published in the Lancet journal revealed that for the first time in centuries, the world’s population is set to decline starting in the next few decades.

There are currently around 7.8 billion people in the world. Experts believe the global population would peak at around 9.7 billion in 2064 before steadily declining to 8.79 billion by 2100.

From the Lancet? Now that’s a trusted source.

Elon Musk has described declining birth rates as one of the “biggest threats to civilisation”. Speaking at a Wall Street Journal event earlier this week he said: “If people don’t have more children, civilisation is going to crumble. Mark my words.”

This isn’t the first time he’s issued this warning. In an interview back in September, he remarked that “a lot of people think there are too many people on the planet; in fact there’s too few.” He also reiterated the point on Twitter yesterday.

The UK is facing a “baby shortage”, with fertility rates dropping to nearly half those seen in the Post-War Boom, raising concerns over potential “long-term” economic stagnation.

A report from Social Market Foundation (SMF) found that in 2020, the total fertility rate (TFR) – the number of children per woman – stood at 1.58 in England and Wales, nearly half of the peak following the Second World War of 2.93. Scotland saw the sharpest decline, with a fertility rate of 1.29.

The narrative we’ve been force-fed for decades is being abandoned by its strictest adherents.

It may be the most astonishing story of the year that no one is paying much attention to. As the Wall Street Journal recently reported on their front page, “Chinese officials are drawing up plans to further loosen birth restrictions and transition toward policies that explicitly encourage childbirth,” (emphasis added). According to Chinese insiders, China, the most populous nation on the planet, is replacing its brutish childbirth restrictions with a program allowing, and even rewarding, couples for having kids. Beijing has announced that its demographic problem today is too few young people, not too many.

Economic forces are disincentivising women from having babies everywhere

The Chinese government has announced that every family may now have three children. This policy change responds to a cratering fertility rate and looming demographic crisis that isn’t confined to China, but replicated all over the developed world.

China’s fertility rate in 2020 was 1.3 children per woman. This is worse than the 2020 US total fertility rate of 1.6, a figure much the same in the UK — and that was already falling before Covid struck. 

All over the world, countries are confronting population stagnation and a fertility bust, a dizzying reversal unmatched in recorded history that will make first-birthday parties a rarer sight than funerals, and empty homes a common eyesore.

Maternity wards are already shutting down in Italy. Ghost cities are appearing in northeastern China. Universities in South Korea cannot find enough students, and in Germany, hundreds of thousands of properties have been razed, with the land turned into parks.

In the past two weeks two global superpowers have had to face an unsettling reality – census results in the US and in China indicate that both countries are likely to start shrinking in population much sooner than they thought.

That’s because fertility rates are falling fast. As that happens, the population gets older, which can stand in the way of economic growth. It’s something governments are usually keen to avoid.

China and the US are not at that point yet. But they could learn from other countries that are already thinking about how to boost fertility.