SHAPING THE FUTURE HOW CHANGING DEMOGRAPHICS CAN POWER HUMAN DEVELOPMENT

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“When relatively large generations reach the prime ages for working and saving, a country will experience a demographically induced economic boost, provided this demographic cohort is productively employed.” – Bloom et. al. 2010 and scope of demographic shifts, but in all cases, the three drivers of a changing population play determining roles. Transition begins with a fall in mortality, especially among children, as health care, including sanitization and hygiene, and nutrition improve. Initially, this means people have more children, but eventually, as the prospects of survival increase, families are motivated to have fewer children. They are able to devote more resources to the health, education and overall well-being of each child, building capabilities that will equip them to be more productive as adults (Figure 1.13). In the middle stage of transition, the share of the working-age population increases on the back of past high fertility rates and declining infant mortality rates. It is high compared to the shares of the older and younger people who depend on them. With families becoming smaller, more women seek paid employment outside the home. Many young workers move to urban areas where salaries and living standards are higher, jobs are more productive, and they can begin to accumulate savings and other assets. This process as a whole can accelerate economic growth and begin to yield a demographic dividend. 46 If it provides decent work and other FIGURE 1.13: The broad stages of demographic transition opportunities accessible to all, growth will be inclusive and high in quality, and contribute to human development. A large share of people in the workforce can spur tax collection, even as a lower share of dependents implies fewer social security expenditures, such as for education and health. Governments may have the resources and flexibility to invest in economic sectors linked to inclusive growth, and to continue investing in human capabilities, such as through quality education and improved health care, that advance and sustain human development, and ensure its benefits are broadly shared. Gradually, the median age of the working population increases. At the middle or close to the end of their working life, people are likely to earn and save more, particularly with fewer children and more women working. The propensity to save also rises as people plan for their retirement, which can lead to increased investment, a positive for economic growth and the demographic dividend. The final stage of transition, typically occurring after many decades, is when ageing sets in, bringing challenges and opportunities for individuals, governments and economies. More people enter retirement. As people tend to live 36
longer with improved availability of medicine and technology, the demand for pensions and health care increases. Countries that used their period of demographic dividend well will be in a better position to support a larger share of older people. Investments made at an earlier stage are critical to sustaining human development gains during rapid ageing. Some countries today, including in Asia-Pacific, are looking at a future of ageing before reaching a higher level of human development. For others, human development needs to accelerate for demographic change to begin. The extent to which countries in different stages can leverage demographic change to attain higher human development depends very much on policies, choices, institutions and long-term investments. DEMOGRAPHIC CHANGE AND <strong>HUMAN</strong> <strong>DEVELOPMENT</strong> Demographic changes influence economic growth and human development through several channels (Figure 1.14). The first is an increased number of people in the workforce. A second channel entails improved human capabilities, built through investing more resources in education and health as well as the effective use of the knowledge and expertise of a more experienced population. When fertility falls and the number of children in a family declines, there is greater potential to invest in the health and education of children, leading to improved human development. The third and fourth channels are improved productivity and enhanced savings, when the workforce is better educated, and people earn higher wages and make greater profits. A fifth channel is through increasing domestic demand, as greater earning and spending feeds economic growth. Urbanization is the last channel. As more and more people flock to urban areas, they can find better health care and education, and diverse opportunities for decent work, all factors of central importance to human development. While increases in the labour supply, savings and human capital can all by default speed up economic growth and contribute to human development, strategic polices, responsible institutions, targeted investment and good governance need to be in place to make the most of potential gains. A number of challenges can arise, foremost among which is creating a sufficient amount of decent work for growing numbers of young people joining the labour force. Another factor involves strengthening the financial sector so that people find adequate, safe instruments for savings and investments. A dimension that is often less discussed is how the bulge in the working-age population can undermine socioeconomic stability if people are not provided with decent jobs. Worrying trends also include the shift of the dependency burden from supporting the young to caring for the elderly. And accelerated urbanization can A large working-age population may undermine socioeconomic stability if people lack decent jobs FIGURE 1.14: With appropriate policies and a conducive environment, demographic changes can improve human development by several channels 37
Page 1 and 2: ASIA-PACIFIC HUMAN DEVELOPMENT REPO
Page 3 and 4: ASIA-PACIFIC HUMAN DEVELOPMENT REPO
Page 5 and 6: FOREWORD We live in times of great
Page 7 and 8: ACKNOWLEDGEMENTS The Asia-Pacific H
Page 9 and 10: Table of Contents Foreword iii Pref
Page 11 and 12: 1.15 Population age-composition is
Page 13 and 14: Acronyms ADB Asian Development Bank
Page 15 and 16: Overview SHAPING THE FUTURE: HOW CH
Page 17 and 18: HUMAN DEVELOPMENT IN ASIA-PACIFIC:
Page 19 and 20: FIGURE 2: Wealthier countries tend
Page 21 and 22: a strong emphasis on protecting wor
Page 23 and 24: could provide job matching assistan
Page 25 and 26: Asia-Pacific leave the workforce at
Page 27 and 28: WHAT’S AHEAD IN THIS REPORT This
Page 29: Chapter 1 HOW CHANGING DEMOGRAPHICS
Page 32 and 33: sustainable, reaching everyone whil
Page 34 and 35: FIGURE 1.1: The Human Development I
Page 36 and 37: TABLE 1.1: Asia-Pacific still has l
Page 38 and 39: married couples to have children, a
Page 40 and 41: FIGURE 1.5: Population pyramids in
Page 42 and 43: FIGURE 1.8: The median age is high
Page 44 and 45: FIGURE 1.10: Disparities in fertili
Page 46 and 47: Improved overall human development
Page 48 and 49: TABLE 1.5: Countries in Asia-Pacifi
Page 52 and 53: 38 Having fewer dependents on worki
Page 54 and 55: 40 In developed Asia- Pacific, the
Page 56 and 57: TABLE 1.6: Demographic dividends fl
Page 58 and 59: 44
Page 61 and 62: 2. MORE PEOPLE AT WORK: THE FOUNDAT
Page 63 and 64: encouraged labour-intensive industr
Page 65 and 66: FIGURE 2.3: Peaks within subregions
Page 67 and 68: A DEMOGRAPHIC RETURN FOR HUMAN DEVE
Page 69 and 70: BOX 2.1: Women bear a larger burden
Page 71 and 72: FIGURE 2.8: Growth in labour produc
Page 73 and 74: WHAT’S BEEN LEARNED IN CHINA, JAP
Page 75 and 76: FIGURE 2.13: Japan is past its work
Page 77 and 78: FIGURE 2.15: Thailand still has tim
Page 79 and 80: make this a key aim of national dev
Page 81 and 82: investment climate, as well as enco
Page 83 and 84: TABLE 2.4: Shares of workers in the
Page 85 and 86: Even before leaving home, migrant w
Page 87 and 88: Promote health and safety at work:
Page 89 and 90: BOX 2.8: Malaysia transforms an ind
Page 91 and 92: of resilient infrastructure are joi
Page 93: Chapter 3 NURTURING CHILDREN, UNLOC
Page 96 and 97: Asia-Pacific is home to 1.7 billion
Page 98 and 99: Commendable progress in education m
Page 100 and 101:
Quality primary education mitigates
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In most Asia-Pacific countries, sec
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Strong tertiary education is a buil
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FIGURE 3.3: Access to tertiary educ
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94 TABLE 3.9: Youth illiteracy has
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TABLE 3.11: Child mortality rates b
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BOX 3.7: Malnutrition and disabilit
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Despite social and economic progres
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FIGURE 3.8: The share of youth who
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104 Young migrants are highly vulne
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as an important challenge. But they
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TABLE 3.15: Some countries with lar
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Immunization saves children’s liv
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BOX 3.10: Germany’s vocational tr
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BOX 3.12: Partnering with youth in
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116
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4. AGEING SOCIETIES: NEW OPPORTUNIT
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FIGURE 4.1: Asia-Pacific is one of
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TABLE 4.1: East Asia is the oldest
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BOX 4.2: Responses to poverty among
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BOX 4.3: A plan of action for older
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FIGURE 4.9: Per capita health-care
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BOX 4.5: China moves towards univer
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TABLE 4.3: Social pensions are an i
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FIGURE 4.12: Pension replacement ra
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BOX 4.7: Increasing links between p
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cupy space in some public buildings
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ment bodies, encourage regular inte
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BOX 4.9: Ageing countries begin enc
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help coordinate the work of other g
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for older people. Many advanced cou
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action. Free public transport, and
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Chapter 5 TAPPING THE HUMAN DYNAMIS
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In the last 30 years, Asia-Pacific
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FIGURE 5.3: Even countries with few
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FIGURE 5.6: Most people will contin
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160 Social, cultural and economic i
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The benefits of urbanization have n
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BOX 5.2: Pioneering urban poverty r
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vehicles on the road. Beijing issue
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Municipal governments in Asia-Pacif
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TABLE 5.4: Revenue mobilization opt
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172 City governments need to have t
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Investing in essential infrastructu
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176 in East Asian cities, and occur
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BOX 5.9: The Republic of Korea emba
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180
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6. AN AGENDA FOR ACTION: SHAPING TH
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Development Report argues, decent w
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with ministries overseeing youth, e
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This is an urgent priority in a reg
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SUSTAINING HUMAN DEVELOPMENT ACROSS
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plan automatically enrols people in
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BOX 6.3: Developing Delhi’s metro
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End Notes CHAPTER 1 1. UNFPA 2014b.
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63. WHO 2014b. 64. UNFPA 2012. 65.
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produces 40 percent of total econom
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206 The Asia Foundation. 2013. “T
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208 CODI (Community Organizations D
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210 Global Migration Group. 2014.
Page 226 and 227:
212 Janwani. 2010. “Annual Report
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214 ———. 2012a. OECD Employme
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216 ———. 2011. “Follow-up t
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218 York. [www.unfpa.org/sites/defa
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———. 2012c. Malaysia Economic
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tables include the Caribbean countr
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224
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TABLE 2: Trends in the Human Develo
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TABLE 4: Gender Inequality Index 22
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TABLE 6: Trends in income poverty,
Page 246 and 247:
TABLE 8: Fertility rate and crude d
Page 248 and 249:
TABLE 10: Trends and share of child
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TABLE 12: Trends and share of young
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TABLE 14: Trends and share of older
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TABLE 16: Education indicators and
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TABLE 17: Health indicators 242
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TABLE 18: Employment and unemployme
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TABLE 19: International trade, fina
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ABOUT ASIA-PACIFIC HUMAN DEVELOPMEN
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