This article is taken from the Spring 2025 issue of

Think Global People magazine

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The reason for the latter simply comes down to births: the fact the fertility rate in most wealthy nations - including China, India, the US and virtually all of Europe - has now fallen well below the rate needed to sustain populations at current levels, which would leave ever-shrinking workforces incapable of generating the wherewithal to support a 'silver tsunami' of elderly.The New York-based McKinsey Global Institute reported recently: "Falling fertility rates are propelling major economies toward population collapse in this century. Two-thirds of humanity lives in countries with fertility below the replacement rate of 2.1 children per family. By 2100, populations in some major economies will fall by 20 to 50 percent, based on UN projections."Age structures are inverting from pyramids to obelisks, as the number of older people grows and the number of younger people shrinks. The first wave of this demographic shift is hitting advanced economies and China, where the share of people of working age will fall to 59 per cent in 2050, from 67 per cent today. Later waves will engulf younger regions within one or two generations. Sub-Saharan Africa is the only exception."Last year, Yoon Suk Yeol, the-then president of South Korea where the fertility rate tumbled to just 0.72 in 2024, declared the birthrate a "national emergency" and announced plans for a dedicated government ministry to try and tackle the issue. Greece's fertility rate of 1.3 poses an "existential" population threat, according Prime Minister Kyriakos Mitsotakis.Washington-based academic Otaviano Canuto, a former executive director of both the World Bank and International Monetary Fund, says that, at the moment, immigration represents the most effective mechanism to counteract demographic decline. Research he has conducted with economist Eduardo Andrade shows how immigration "has contributed to economic growth in high-income countries by replenishing the workforce, stimulating demand, and alleviating the fiscal burden of ageing populations".Yet, he says, an "immigration conundrum" has now emerged. "Despite its economic benefits, immigration faces mounting resistance in many high income countries. Anti-immigrant sentiment has been a decisive force in elections across Europe and North America, with populist movements leveraging fears of cultural displacement and economic insecurity to rally support. This backlash has complicated policymaking, with governments struggling to reconcile economic necessity with political reality."But opposition to immigration is not uniform, Prof Canuto adds, with some politicians in the US and Europe advocating a total halt to immigration while others favour policies that prioritise highly educated migrants."If history is any guide," he says, "economic logic alone is unlikely to override nationalist impulses. However, as labour shortages intensify and pension systems come under strain, the need for pragmatic immigration policies will become harder to ignore. The question is not whether immigration can help address ageing-related economic challenges — it already does. The real question is whether societies are willing to accept it as part of a long-term solution."That long-term solution is already beginning to find favour in Japan where the fertility rate in 2024 dipped to 1.20. Hiroshi Yoshida, the director of Tohoku University's Research Center for Aged Economy and Society, told the Yomiuri Shimbun newspaper: "As long as the decline in the number of births does not stop, the hands of the 'clock' will never turn back. Japan may become the first country to become extinct due to the declining birth rate. We should create an environment in which women and the elderly can work and aim for a society in which all people can play an active role."For some years, Japan has invested billions of yen in pro-natal policies, such as child care allowances and part-time working practices, but the bids to boost births have so far been unsuccessful. Now the government is easing strict immigration policies to help offset the shrinking labour pool in key industries, such as manufacturing, with the aim of tripling the foreign workforce by 2040.Tim Dyson, a demographer at the London School of Economics, says governments' efforts to encourage people to have more children are futile. "Considering the societal shifts, including the significant reduction in gender disparities as women's lives have become increasingly similar to those of men, this (downward trend in fertility) is unlikely to reverse," he said in a BBC interview.Mr Dyson also pointed out that while a fertility rate of 1.8 led to a slow, manageable population decline, a rate of 1.6 or lower could trigger "rapid, unmanageable population decline". The current rate in the UK is 1.44 but a projection from the Office for National Statistics (ONS) suggested in January that the nation's population could actually increase by almost five million to 72.5 in the decade mid-2032. And with indigenous births equalling indigenous deaths over this period, the rise would be entirely attributable to immigration.Predictably, the projection prompted howls of outrage from right-wing politicians and a Downing Street spokesman said the government was "going to publish a white paper to set out a comprehensive plan to end these staggeringly high migration numbers”.But such political pronouncements appear to ignore the fact - demographics aside - that Britain needs to attract the 'brightest and best' to fill shortages in professions from medicine, tech and engineering to social care, agricultural and construction.Ironically, the ONS report (which the organisation insists was a "projection" based on previous data, not a "forecast") coincided with a letter to the government from the House of Lords' Science and Technology Committee whose investigation had raised significant concerns regarding the UK's current immigration and visa policies for science, technology, engineering, and mathematics (STEM) talent.The investigation highlighted the detrimental impact of current immigration policies on the UK's ability to attract and retain highly skilled individuals in the fields of science and technology, with the committee describing the government's current approach as an act of national self-harm. It said the UK needed to adopt a far more holistic and adaptive approach if it wanted to compete in the global race for talent, with high visa costs and the Immigration Health Surcharge being particularly criticised.

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Antonio Lam, UK director of immigration at immigration platform Envoy Global, believes there has been a significant watering down of the skills-based immigration system that successive governments have sought to introduce. "Dilution of its immigration programme and the lack of transparency of how the Immigration Skills Charges are used, results in the continued negative light shown of 'over immigration' and the negative portrayal of global mobility," he says.“Immigration is one of the most straightforward methods of addressing the demographic challenges many Western countries face today. The declining birth rate and an ageing population have vastly reduced a key section of our workforce. That said, relying solely on immigration is not the answer, and immediate stoppage or zero immigration wouldn’t be the right solution."For some years now, there have been many discussions on the negative aspects of immigration and the portrayal of the negative side of immigration."In my view, this is not helpful or furthers the debate on how to address the issues of talent shortages or demographic challenges. Rather, governments internationally ought to have a sensible review of their immigration programmes, the shortfalls of the programmes in addressing the immediate, mid- and long-term needs, and how it does or does not address acute or regional talent and mobility needs."Giovanni Peri, an Italian-born American economist who is professor of economics and director of the Global Migration Center at the University of California, has long argued that the public and political arguments over immigration usually pay insufficient attention to demographics, which he has described as the “Achilles’ heel of the global North”.He says low fertility rates and ageing populations in so many countries will produce “population declines and substantial increases in average ages, both of which could disrupt labour markets, threaten the fiscal sustainability of pension systems, and slow down economic growth, unless total net immigration offsets such declines”.He adds: “The bottom line is that only net immigration can ensure population stability or growth in the aging advanced economies of the North—and this will happen only if we promote forward-looking immigration policies that allow larger numbers of immigrants and consider their long-run impact, rather than focusing only on the short-term calculations of their mostly political costs.”But, Prof Peri adds, while an increase in immigration flows, especially of young people, seems desirable, immigration policies, especially in Europe and the US, have been tightening.“There is increasing evidence that ageing societies are becoming more averse to open immigration policies, and older people have systematically more negative attitudes toward immigrants than younger people. This is paradoxical, as they are the group that stands to benefit the most from immigration: the pension system would be on a more sustainable trajectory, working immigrants do not threaten their jobs, and immigrants work in services often targeted to them, such as caregiving.“Yet the good news is that it appears that such negative attitudes are due more to generational differences than to a simple effect of ageing. A relative lack of exposure to immigrants among the currently old generations in Europe and the United States may be the reason for such attitudes. In Europe, for instance, surveys suggest that millennials and Generation Z have more positive opinions of immigration than do older generations.“As the current younger generations are exposed to more immigration, if they maintain such attitudes as they become older and see their voting power increase, they may support more open immigration policies. Then the positive demographic returns from immigration may be more fully realised.”A report published in late January by the Migration Observatory at the University of Oxford, concluded that "research shows that people do not become more negative towards immigration as they age, as attitudes are quite stable over adulthood".It found that 50 per cent of people with university degrees were more likely to regard immigration as a good or very good thing, compared to only 22 per cent among people with lower levels of education."Multiple factors explain why highly educated people tend to express more liberal attitudes towards immigration in surveys, including holding more cosmopolitan or nationalistic views, being more susceptible to social desirability bias (that is, hiding their views when these are not socially acceptable), or being less affected by labour market competition with migrants," said the report.Unless these liberal attitudes towards migration expand among voters in rich nations over the coming years, the fear is that falling birth rates might well have the last word in global labour markets.

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