Demographic dividend — boon or bane?

Here are a few numbers: Pakistan’s 66 per cent population is below the age of 30 — I quote from a newspaper report. That makes 158 million; 25 million of these in the school-going age do not go to school. Our record keeping and data is mostly suspect, nor any robust research based on or around collecting data is our forte. Representative reports by international agencies rely on samples and what trades as in-country statistics. Hence, it is prudent to consider these numbers with some circumspection, at best roundabouts. The situation could be far worse. The population is expected to increase at the rate of 1.9-2 per cent causing it to explode to 280 million by 2030. Of these 100 million alone are between ages 10-30 years. By 2050 we should be looking at around 300 million of us or more.

On the average we add 20 million people every ten years in the periodic cycle of a census. Of these officially 1.3 million are added to the labour market every year, though the number could be as high as two million which is what must drive our concern. In a shrinking economy and increasing unemployment these number of able-bodied men and women are loitering around unattended and are unoccupied productively. Some fall prey to insidious hands of criminals and armed groups becoming pawns in their objective to harm the state and the society. Others continue to dream of greener pastures across the seas finally drowning with their dreams in the seas and oceans of the world banished to their fate.

In comparison the world average of below 30s is 42 per cent which will continue to go down as people age in developed societies of Japan, Europe and North America. Economists link this demographic inversion in age groups to the decline of the West and the rise of the rest. There are some recent examples: Kenya is considered as the emerging player of significant effect in Africa where growth and development have rapidly improved the lot of the people in a thriving economy. Economists cite a decline in population growth rate as the most significant parameter enabling this turnaround. Fifty years back every Kenyan mother bore 8 children on the average; last year the number had dropped down to only three. They suggest that is how South Korea too began changing in the 1970s and became the poster child of miraculous economic development. Today an ageing population and lower fertility rates threaten to plateau such growth in South Korea.

A recent story in The New York Times was titled, ‘A huge shift, as nations with wealth grow older’. The story goes on to list the economic powerhouses of the past, present and the future on a roughly 30 years gap scale and suggests that in each era it was the productive labour which enhanced growth enabling those nations to make the grade of leading economies. The 1990s list top ten economies on the back of the largest working-age share of the population in the world. Today, only two of those remain on the list of nations benefitting from the productive age-group. Eight others are anvil economies who still must wrestle with the potential enablement to propel into the exclusive club. Bangladesh, Vietnam and Brazil have far greater potential waiting to be leveraged with remedial policies.

In 2050 India would be the only nation with a demographic dividend holding its position on the list of most developed economies in the world. China would have slid out of that list because of an ageing population and rapidly dwindling numbers in the working-age group though she might have other enablers including cutting edge technology that will keep it among the richest economies — as is the case with the US today which on the back of targeted legal immigration in the working-age group continues to retain its position as a leading economy. A recent debate though questions the policy of restricted legal immigration into the US vis a vis Canada which is taking in three times as many immigrants to bolster its working-age population. It is felt such an anachronistic approach to immigration will soon tell upon the US standing among world economies. Although the frontiers of the new economy will be defined by Artificial Intelligence, machine-learning, robotics and quantum computing, there shall be a need for human intervention when tending to a rapidly evolving society with its own social and economic peculiarities. The new economy will need a new kind of a workforce. It shall need to be so trained. Merely declaring IT as a sector of growth doesn’t count for much. It would need major policy intervention.

The NYT story further suggests, “Demography isn’t destiny, and (the) dividend isn’t automatic. Without jobs, having a lot of working age people can drive instability rather than growth”. And then, “Without the right policies, a huge working-age population can backfire… If large numbers of young adults don’t have access to jobs or education, widespread youth unemployment can threaten stability, as frustrated young people (increasingly) turn to criminal or armed groups for better opportunities.” Pakistan stands vulnerable on both counts: a rising wave of insurgency and a society dominated by unemployed youth in a shrinking economy makes for a deadly mix, unless urgently attended to. The potential and promise though of a demographic construct should never be underestimated. It is for Pakistan to leverage this opportunity of reversing trends to harness the potential into a bright prospect.

Recent initiatives at the national level on farming and agriculture and on IT and natural resources are a good beginning but these are more meant to re-energise what already exists. IT and other human resource-based areas need a detailed treatment of how to enable a population which is only partially literate in an IT infrastructure which is barely rudimentary. To turn IT into a productive sector at scale, manpower will need to be vocationally focused and trained. Learning computer languages and source coding are first few steps but we must understand the wide gap that we need to bridge in a short time as the world stands on the anvil of break-through technologies. Then there are areas beyond IT which must suit a semi-literate workforce — not all will or can turn into IT wizards. Sri Lanka trains its population in hospitality, nursing, gem-cutting and polishing, janitorial services, etc and then exports such skilled and semi-skilled labour to markets desperate to fill these jobs. In return it earns its dollars and precious FE. Sri Lanka’s recent history does not take away the essence of how a society and a system caters to all levels of qualification and benefits from its returns.

There is just so much more to do beyond what SIFC alone will handle but it needs the same amount of attention which SIFC will give to agriculture and mining.

Published in The Express Tribune, August 4^th, 2023.

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