The Dramatic Global Rise of Urbanization (1950–2020)
In the 21st century, few trends have matched the economic, environmental, and societal impact of rapid urbanization.
A steady stream of human migration out of the countryside, and into swelling metropolitan centers, has shaken up the world’s power dynamic in just decades.
Today’s eye-catching map via Cristina Poiata from Z Creative Labs looks at 70 years of movement and urban population growth in over 1,800 cities worldwide. Where is the action?
Out of the Farms and Into the Cities
The United Nations cites two intertwined reasons for urbanization: an overall population increase that’s unevenly distributed by region, and an upward trend in people flocking to cities.
Since 1950, the world’s urban population has risen almost six-fold, from 751 million to 4.2 billion in 2018. In North America alone, significant urban growth can be observed in the video for Mexico and the East Coast of the United States as this shift takes place.
Over the next few decades, the rural population is expected to plateau and eventually decline, while urban growth will continue to shoot up to six billion people and beyond.
The Biggest Urban Hot-Spots
Urban growth is going to happen all across the board.
Rapidly rising populations in megacities and major cities will be significant contributors, but it’s also worth noting that the number of regional to mid-sized cities (500k to 5 million inhabitants) will swell drastically by 2030, becoming more influential economic hubs in the process.
Interestingly, it’s mainly cities across Asia and Africa — some of which Westerners are largely unfamiliar with — that may soon wield enormous influence on the global stage.
It’s expected that over a third of the projected urban growth between now and 2050 will occur in just three countries: India, China, and Nigeria. By 2050, it is projected that India could add 416 million urban dwellers, China 255 million, and Nigeria 189 million.
Urbanization and its Complications
Rapid urbanization isn’t only linked to an inevitable rise in city populations.
Some megacities are actually experiencing population contractions, in part due to the effects of low fertility rates in Asia and Europe. For example, while the Greater Tokyo area contains almost 38 million people today, it’s expected to shrink starting in 2020.
As rapid urbanization continues to shape the global economy, finding ways to provide the right infrastructure and services in cities will be a crucial problem to solve for communities and organizations around the world. How we deal with these issues — or how we don’t — will set the stage for the next act in the modern economic era.
The Problem of an Aging Global Population, Shown by Country
The data behind the world’s rapidly aging population, and what it could mean for the economy and future generations of retirees.
The Implications of an Aging Population
The world is experiencing a seismic demographic shift—and no country is immune to the consequences.
While increasing life expectancy and declining birth rates are considered major achievements in modern science and healthcare, they will have a significant impact on future generations.
Today’s graphic relies on OECD data to demonstrate how the old-age to working-age ratio will change by 2060, highlighting some of the world’s fastest aging countries.
The Demographic Debacle
By 2050, there will be 10 billion people on earth, compared to 7.7 billion today—and many of them will be living longer. As a result, the number of elderly people per 100 working-age people will nearly triple—from 20 in 1980, to 58 in 2060.
Populations are getting older in all OECD countries, yet there are clear differences in the pace of aging. For instance, Japan holds the title for having the oldest population, with ⅓ of its citizens already over the age of 65. By 2030, the country’s workforce is expected to fall by 8 million—leading to a major potential labor shortage.
In another example, while South Korea currently boasts a younger than average population, it will age rapidly and end up with the highest old-to-young ratio among developed countries.
A Declining Workforce
Globally, the working-age population will see a 10% decrease by 2060. It will fall the most drastically by 35% or more in Greece, Japan, Korea, Latvia, Lithuania, and Poland. On the other end of the scale, it will increase by more than 20% in Australia, Mexico, and Israel.
Israel’s notably higher increase of 67% is due to the country’s high fertility rate, which is comparable to “baby boom” numbers seen in the U.S. following the second World War.
As countries prepare for the coming decades, workforce shortages are just one of the impacts of aging populations already being felt.
Managing the Risks
There are many other social and economic risks that we can come to expect as the global population continues to age:
- The Squeezed Middle: With more people claiming pension benefits but less people paying income taxes, the shrinking workforce may be forced to pay higher taxes.
- Rising Healthcare Costs: Longer lives do not necessarily mean healthier lives, with those over 65 more likely to have at least one chronic disease and require expensive, long-term care.
- Economic Slowdown: Changing workforces may lead capital to flow away from rapidly aging countries to younger countries, shifting the global distribution of economic power.
The strain on pension systems is perhaps the most evident sign of a drastically aging population. Although the average retirement age is gradually increasing in many countries, people are saving insufficiently for their increased life span—resulting in an estimated $400 trillion deficit by 2050.
Pensions Under Pressure
A pension is promised, but not necessarily guaranteed. Any changes made to existing government programs can alter the lives of future retirees entirely—but effective pension reforms that lessen the growing deficit are required urgently.
Towards a Better System
Certain countries are making great strides towards more sustainable pension systems, and the Global Pension Index suggests initiatives that governments can take into consideration, such as:
- Continuing to increase the age of retirement
- Increasing the level of savings—both inside and outside pension funds
- Increasing the coverage of private pensions across the labor force, including self-employed and contract employees, to provide improved integration between various pillars
- Preserving retirement funds by limiting the access to benefits before the retirement age
- Increasing the trust and confidence of all stakeholders by improving transparency of pension plans
Although 59% of employees are expecting to continue earning well into their retirement years, providing people with better incentives and options to make working at an older age easier could be crucial for ensuring continued economic growth.
Live Long and Prosper
As 2020 marks the beginning of the Decade of Healthy Ageing, the world is undoubtedly entering a pivotal period.
Countries all over the world face tremendous pressure to effectively manage their aging populations, but preparing for this demographic shift early will contribute to the economic advancement of countries, and allow populations—both young and old—to live long and prosper.
Visualizing How the Demographics of China and India are Diverging
The world’s two most populous countries have some economic similarities, but China and India are also diverging in one key area: demographics.
How the Demographics of China and India are Diverging
Within popular discourse, especially in the West, the profiles of China and India have become inextricably linked.
Aside from their massive populations and geographical proximity in Asia, the two nations also have deep cultural histories and traditions, growing amounts of influence on the world stage, and burgeoning middle classes.
China and India combine to be home to one-third of the world’s megacities, and they even had identical real GDP growth rates of 6.1% in 2019, based on early estimates by the IMF.
But aside from the obvious differences in their political regimes, the two populous nations have also diverged in another way: demographics.
As seen in today’s animation, which comes from AnimateData and leverages data from the United Nations, the two countries are expected to have very different demographic compositions over time as their populations age.
The easiest way to see this is through a macro lens:
Populations of China and India (1950-2100)
|🇮🇳 India||0.38 billion||1.37 billion||1.64 billion||1.45 billion|
|🇨🇳 China||0.55 billion||1.43 billion||1.40 billion||1.06 billion|
Although the countries have roughly the same populations today — by 2050, India will add roughly 270 million more citizens, and China’s total will actually decrease by 30 million people.
Let’s look at the demographic profiles of these countries to break things down further. We’ll do this by charting populations of age groups (0-14 years, 15-24 years, 25-64 years, and 65+ years).
China: Aftermath of the One-Child Policy
China’s one-child policy was implemented in 1979 — and although it became no longer effective starting in 2016, there’s no doubt that the long-term demographic impacts of this drastic measure will be felt for generations:
The first thing you’ll notice in the above chart is that China’s main working age population cohort (25-64 years) has essentially already peaked in size.
Further, you’ll notice that the populations of children (0-14 years) and young adults (15-24 years) have both been on the decline for decades.
A reduction in births is something that happens naturally in a demographic transition. As an economy becomes more developed, it’s common for fertility rates to decrease — but in China’s case, it has happened prematurely through policy. As a result, the country’s age distribution doesn’t really fit a typical profile.
India: A Workforce Peaking in 2050
Meanwhile, projections have India reaching a peak workforce age population near the year 2050:
By the year 2050, it’s estimated that India’s workforce age population will be comparable in size to that of China’s today — over 800 million people strong.
However, given that this is at least 30 years in the future, it raises all kinds of questions around the economic relevance of a “working age” population in a landscape potentially dominated by technologies such as artificial intelligence and automation.
While it’s clear that the world’s two most populous countries have some key similarities, they are both on very different demographic paths at the moment.
China’s population has plateaued, and will eventually decline over the remainder of the 21st century. There is plenty of room to grow economically, but the weight of an aging population will create additional social and economic pressures. By 2050, it’s estimated that over one-third of the country will be 60 years or older.
On the other hand, India is following a more traditional demographic path, as long as it is uninterrupted by drastic policy decisions. The country will likely top out at 1.6-1.7 billion people, before it begins to experience the typical demographic transition already experienced by more developed economies in North America, Europe, and Japan.
And by the time the Indian workforce age group hits 800+ million people, it will be interesting to see how things interplay with the world’s inevitable technological shift to automation and a changing role for labor.
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