Falling Birth Rates And Changing Age Structure

FALLING BIRTH RATES AND CHANGING AGE STRUCTURE Despite explosive global population growth earlier, especially in developing nations, birth rates are now falling universally. Population still grows annually but at a declining rate. Declining birth rates have serious business implications. With fewer babies, markets for baby products shrink, prompting strategies like repositioning Johnson & Johnson baby brands for wider appeal and emphasizing international business. But industries like hotels, airlines, and restaurants benefit from childless couples having more income and time for leisure. Small families also have such advantages over large families. As per Peter Drucker, the collapsing birth rate in developed nations is "national suicide". Many countries have below-replacement birth rates, presaging major population declines by 2100 - like Italy potentially falling from 60 to 20-22 million. For businesses targeting children, this poses a threat. But lower birth rates increase the value of each child. More disposable income may be lavished on the only child in China or few children in countries like Germany and the US. In developing countries, still-high birth rates and rising incomes are expanding markets rapidly. Large, mostly poor, populations also present opportunities to address problems like education, healthcare, water etc. And abundant labor encourages laborintensive production. Changing Occupational and Spatial Mobility High occupational and spatial workforce mobility likely reduces labor problems. But heterogeneous labor in terms of language, religion, ethnicity etc. complicates personnel management. It also causes varied demand patterns needing tailored marketing strategies. Changing Age Distribution Falling birth rates and rising longevity alter age distributions, increasing the proportion of aged people. By 2080, one-third of Italy's projected 20-22 million people could be over 60. In Japan, the disproportion between young and retirement-age people will be greater. In the US too, the elderly population is rising faster than the young. The changes have business implications. Pharmaceutical firms target the expanding elderly population's needs. The rising welfare burden on governments is a concern. According to Drucker, the collapsing birth rate has political and social implications:  For 20-30 years, turbulent demographic politics will dominate developed nations, with unstable governments.  Retirement may entail part-time work rather than complete stoppage, especially for knowledge workers.  Productivity of all workers, especially knowledge workers, will have to greatly increase to avoid national decline.  Immigration will rise but also be politically contentious. While developed country populations shrink, developing country populations expand, causing migration pressures despite resistance. Immigration has already transformed America's ethnic composition. Marketers must understand varied ethnic group needs but avoid overgeneralizing.