#272 1.5 Bn People Just Changed Sides

It was only in April 2023 that India became the largest country in the World. It passed China when when its population reached 1,425,775,850. Now three years later it too has low fertility. In 1950 India had a population of 360m. The average woman had 6 children. That number is now 1.9.

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Today, 71% of the worlds population lives in countries that have a fertility below replacement level. In 1950 the global average fertility was 4.85 children. Today it is just above replacement level at 2.2. Only Africa has a fertility rate above replacement (3.85). Europe by comparison has fallen to 1.41.

Declining Population

The Indian population has not yet started to decline. There are enough young people of child bearing age to maintain the growth momentum for a while. 65% of the population are under 35. Forecasts vary for when the population will actually peak. The range is between ten and twenty years from now. Some forecasts are much sooner. They suggest a peak within the next ten years. They cite the 1m Indians a year that leave the country as migrants.

The Variability Problem

India is an excellent example of the problems faced by all countries with declining populations. There is a huge variations in demographic dynamics within individual countries. Two Indian states are already in population decline. The North Eastern state of Sikka has a fertility level today of 1.1. Across the country states are scambling to undo policies designed to restrict population growth. For many years there was a real fear of a “population explosion”. In Andhra Pradesh there was a policy that you could not stand for public office if you had more than two children. That law was recently repealed. The fertility level in Andhra Pradesh is now 1.5 compared to 1.46 in the EU. It has a population half way between Italy and Spain.

Population decline brings with it a decline in working age population. That in turn reduces tax revenues and puts pressure on public services. Child and adult mortality in India can still be too high by international standards. Kerala has a child mortality rate comparable to the US. It is still higher than much of Europe. In rural areas child mortality average 28 per 1000 child born. In urban areas it is only 19. It has been driven down by investment in health infrastructure including public health.

The huge variablity is not unique to India. It has a North South split. Fertility in the South is much lower. In the USA the split is between the Great Plains, Midwest and South which all have higher fertility compared to the rest of the USA. The North East has the lowest fertility. North Dakota has the highest birthrate in the USA. “Leveling Up” is a major problem everywhere. This is politically sensitive. At the same time initiatives to improve fertility are at the state level.

Getting Rich before you get Old.

10% of the Indian population are over 65. The forecasts are for that to double by 2050. It is fortunate that today there is a huge working age population. In fact the working age population of India represents 20% of the global total. India should be able to collect a “demographic dividend”. The number of children to be educated will go down. The number of older people in need of care is only growing slowly. However that dividend requires 7.85m new jobs every year. Currently youth unemployment is 16%. Graduate unemployment has been quoted as high as 40%. India produces 5m graduates a year.

The economy is creating jobs. The problem is like everywhere else in the World. Whether they are in the correct geography and sector. Agricultural jobs are growing. Manufacturing growth is proving harder. The movement of Apple assembly from China to India is helping. New assembly factories have hired 125,000 people this year. 80% are women entering the workforce for the first time.

An Inverted Logic.

A recent study in the Nordics highlights the imporance of employment to fertility. Historically the better educated and more affluent couples were less keen to have children. Workers with lower incomes had the children. The situation has now reversed. The insecurity of the job market means that lower income couples are less likely to have children. More affluent couples are doing it instead. Jobs are yet another factor in the decline in fertlity.

Looking at states or regions within a country shows one view of variability. In reality there is as much diversity down to the city level.(See Newsletter #121 "Ageing is a Universal Issue)

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