The World in 2050: Rapid Changes Ahead
Last week, I picked up a copy of the Wall Street Journal and was saddened and troubled to see the picture of a baby Syrian boy’s body being recovered from the sea. It was all the more ironic that I was preparing to give a talk on the World in 2050. It made me think that we are on the cusp of many rapid and dramatic changes. By 2050, we will have some 9.6 billion people on the planet, up from our current population of some 7.3 billion.[1] A big change facing the human race is the massive demographic shift that we will see in accordance with this population growth. Not all populations are growing equally. The sad events in Syria and elsewhere are part of this big shift. The world will have a super abundance of people in some places and a rapidly aging population in other places. As far as we can tell, the size, speed, and dramatic nature of the changes to our population are unprecedented in human history and will pose both challenges and opportunities.
India will Surpass China in Population (and Growth?)
We have grown comfortable with China being the population and economic growth engine for the world. Need another factory? China has been able to add manufacturing capacity in a low cost manner and find new workers to operate the factories. Due to the one-child policy and now the movement of many Chinese to urban areas, which typically results in the downsizing of family size, China will have a smaller and older population by 2050 (1.30 billion) than it does today (1.37 billion in 2015). It is somewhat hard to accept that China will soon be shrinking. The challenge here is that economically speaking, much of China’s growth has come from its ability to generate a labor supply and customer demand to fuel global markets. With concerns about China not meeting economic growth targets today and some 45% of the population already urbanized, one is forced to wonder if this slowing growth is a permanent change for the future and an earlier start to the inevitable slowdown than anticipated.
This brings us to India, which will be, by 2050, the most populous nation in the history of the world with over 1.66 billion people, up from its current population of some 1.25 billion. India will add more people to its population in the next 35 years than we have in the U.S. today! India still has a great deal of growth potential with only some 30% of its population living in urban areas. India’s growth will require access to more and new food supplies and a low-cost supply of energy. The opening of Iran and the access of other large energy finds in recent decades are all positive factors to support the economic growth of India. There is a strong intellectual base and educational system in India. Conditions for economic hyper growth are very positive.
Africa will Surprise Us
The largest boom in population growth will come from West Africa. Nigeria, which has a landmass about the size of Texas, will grow from its current population of 180 million to about 400 million in 2050.
It will more than double its population in a landmass that is already feeling crowded. The above population pyramid growth for Nigeria shows that Nigeria will remain a growing population through the next century, too.[2]
Most forecasts suggest that Nigeria will about equal the U.S. in population by 2050. Some project even faster population growth for Nigeria such that Nigeria will top the U.S. by 2040. This growth in Nigeria will be similarly matched by other countries in West Africa, leading many industries to examine Africa as a source for talent, customer demand, and indeed overall growth!
The U.S. will become more Hispanic
The U.S., like most developed countries, is aging. We are all familiar with the Baby Boomer population. However, the delay in marriage, lower rate in the formation of families and the reduction of family sizes are new normals for millennials. The net is that America will see an aging population, but immigration and the higher birthrate of immigrants in the U.S. will have U.S. population grow from today’s level of approximately 325 million to some 395 million by 2050. It is a respectable growth, which will come almost entirely from the Hispanic population. The Pew Research Center estimates that 82% of the U.S. population growth will come from Hispanics and that by 2050, the Hispanic population will grow from a current 17% to nearly 30%.
Foreign-born Americans will make up nearly 20% of the population by 2050, up from today’s 12% (although these number are clearly hard to confirm owing to undocumented residents). The Asian population, which is now about 5%, will double to 10% by 2050; the African-American population will remain at about 13%, and Caucasians are expected to comprise less than 47% of the population by 2050, showing a dramatic decline.[3] We will have an abundance of older people and fewer young people, suggesting that population growth will slow into the next century in the absence of greater immigration. Of course, immigration pressure will exists for the US, suggesting an even richer ethnic composition after 2050!
The World Will Need More Women
The population explosion that is occurring in India comes with an unfortunate and troubling imbalance. Owing to cultural preferences and gender-specific infanticide, India produces more boys than girls, and this is a growing problem. This cultural preference has been at work for many decades now and the population imbalance of women is irreversible. Consider the population pyramids for India and China, showing this grave imbalance.
The United Nations predicts that in Asia, there will be some 80 million to 100 million men with no prospect of forming a family by 2050. We should expect that the imbalance will be concentrated in the poorest strata of society. As families form, the poorest women will have mobility upward and the poorest men will have the hardest time in having families. This will be a social challenge that will bring changes to the concept of families, communities, marriage, and happiness in many of the poorest parts of Asia. The world has not seen this level of imbalance before and how it will be resolved is a new challenge.
Some Thoughts and Observations on Growth
For companies and investors looking for growth in the world, I offer a few major trends. The world will have massive expansion in the warmest climates. Warm climates demand air conditioning, refrigeration, and such comforts go a long way in changing the satisfaction of the population. With rare exception do people ever give up such comfort. Also, the growth of these populations (especially in India) will correspond to higher per capita GDP. As people move out of the depths of poverty and into the so-called “global middle class” they adopt a richer diet that is based more on animal protein. This will require more soybean production for the raising of animals and put new pressures on sustainable animal husbandry as meat consumes not just soy beans, but large amounts of water and energy. These people will need transportation and communications. The development of low cost automobiles and the expansion of mopeds will bring these growing populations access to combustible engines and the continued environmental challenges posed by them. On the flip side, the U.S., Europe, and Japan will need solutions for an aging population. Obviously healthcare is a focus. But these aging populations will consume services. Some of this can be met by immigration, but automation and even robots will, and already are answering the call.
It is clear from the Syrian crisis that millions people will need to move across borders in pursuit of peace and prosperity. This movement will continue to be amplified in the coming decades. Arguably, we are just seeing the beginning. Businesses and governments will need to change how they connect supply and demand globally. Workers are not just contributors but are also customers. Growth will come from matching supply and demand and bring peace and prosperity to the millions (actually billions) of people who are looking to improve their lives.
Professor Walker provides keynote talks, seminars presentations, executive training programs, and executive briefings.
Recent talk topics enjoyed by clients have included:
“From Big Data to Big Profits: Getting the Most from Your Data and Analytics”
“Data Monetization”
“Leveraging Artificial Intelligence and Automation at Work”
“Winner Take All – Digital Strategy: From Data to Dominance”
“Success with an Inter-Generational Workforce: From Boomers to Millennials”
“FinTech, Payments, and Economic Trends and Outlooks in Consumer Lending”
“The World in 2050: Risks and Opportunities Ahead”
Exceptional executive training programs have included:
“Digital Disruption, Automation, Analytics, Data Science, the IoT, and the Big Data Wave”
“Master Course on Operational Risk: Measurement, Management, Leadership”
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“Managing Your Brand and Reputation in a Crisis.”
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About Russell Walker, Ph.D.
Dr. Walker is Clinical Professor of Managerial Economics and Decision Sciences at the Kellogg School of Management of Northwestern University.
Professor Walker has developed and taught executive programs on Enterprise Risk, Operational Risk, Corporate Governance, Analytics and Big Data, and Global Leadership. He founded and teaches the Analytical Consulting Lab, Risk Lab, Global Lab, and Digital Lab – all very popular experiential learning classes at the Kellogg School of Management, which bring Kellogg MBA students together with corporate opportunities focused on data and strategy. He also teaches courses in risk management, analytics, and on strategies in globalization.
His most recent book From Big Data to Big Profits: Success with Data and Analytics is published by Oxford University Press (2015), which explores how firms can best monetize Big Data. He is the author of the book Winning with Risk Management (World Scientific Publishing, 2013), which examines the principles and practice of risk management through business case studies.
He has also authored many business cases and published multiple Kellogg case studies through Harvard Business School Publishing. His cases have been highlighted by the Harvard Business School Publishing, the Aspen Institute, PRMIA, and the Bank of England for excellence in teaching risk management.
He serves on the Scientific and Technical Council for the Menus of Change, an initiative led by the Harvard School of Public Health and the Culinary Institute of America, to develop healthier and more environmentally friendly food choices. He was formerly on the board of the Education and Technology Committee to the Morton Arboretum. He was a board member of the Virginia Hispanic Chamber of Commerce, where he developed support programs for Hispanic entrepreneurs and worked with US senators on US Latino matters.
He is at @RussWalker1492 and russellwalkerphd.com.
[1] United Nations Population Projections, 2012.
[2] Population pyramid graphics are from the International Data Base, made available by the US Census Bureau.
[3] http://www.pewhispanic.org/2008/02/11/us-population-projections-2005-2050/
2050, Africa, China, Demographics, Global Affairs, Global Growth, Globalization, Hispanic, Hispanic Population, India, International Business, Nigeria, Population, Trade, US, World Economics, World Economy
Russell Walker helps companies develop strategies to manage risk and harness value through analytics and big data. He has done novel research in data monetization and digital disruption and advises leading firms on these topics.
As Director of Experiential Learning in Analytics and Associate Teaching Professor of Marketing and International Business at the Foster School of Business, at the University of Washington, Dr. Walker is an academic thought-leader on analytics. Russell Walker has developed and taught leading executive programs on Big Data and Analytics, Strategic Data-Driven Marketing, Enterprise Risk, Operational Risk, and Global Leadership. Previous to moving to Seattle and the Foster School, Dr. Walker was Clinical Professor at the Kellogg School of Management of Northwestern University, where he founded and taught many popular courses in analytics and risk management.
His is the author of the book From Big Data to Big Profits: Success with Data and Analytics (Oxford University Press, 2015) which examines data monetization strategies and the development of data-centric business models in the new digital economy. He is also the author of the award-winning text Winning with Risk Management (World Scientific Publishing, 2013), which examines the principles and practice of risk management as a competitive advantage.
Dr. Walker consults with firms on the topics of Big Data and Analytics, Data Monetization, Risk Management, and Business Strategy.
Russell Walker can be reached at:
russell@walkerbernardo.com
@RussWalker1776
russellwalkerphd.com
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