A major new report paints an alarming picture of demographic decline

Falling fertility rates are propelling the major economies toward a major reckoning, according to a new study by the McKinsey Global Institute, one of the world’s leading management consulting firms.

As the report, entitled “Dependency and Depopulation? Confronting the Consequences of a New Demographic Reality” confirms, a huge and growing portion of the global population now resides in countries where fertility rates have fallen well below the replacement threshold of 2.1 children per woman.

In Ireland, it is currently at 1.5. Only in sub-Saharan Africa are fertility rates still well above replacement level.

This trend indicates that, by the end of the century, several major economies could witness population reductions ranging from 20pc to 50pc. For instance, China’s population has been decreasing year on year, with a reduction of 1.4 million in 2024 alone, and in 2100 will have less than half of the current population. Like the rest of East Asia, China does not want mass immigration to help alleviate the problem. However, even if China were to try this approach, there are simply not enough people in the world who can come to China and balance out its population decline between now and the end of the century.

The big decline in fertility rates is creating a growing unbalance between generations.

With families shrinking in size almost everywhere, for the first time in history a sharply declining number of young people will have to support for a fast growing cohort of older people who are not working.

The report calls “first wave economies” those regions that are at the forefront of experiencing demographic shifts associated with declining fertility and ageing populations.

In  what it calls ‘Advanced Asia’ (Australia, Japan, New Zealand, Singapore, and South Korea), ‘Greater China’ (Mainland China, Hong Kong, Macau and Taiwan) and ‘Western Europe’, there were 6.8 working-age individuals for every person over 65 years in 1997. Today this ratio is 3.9 to 1 and by 2050 it will fall to just two working age people for every retiree.

These changes pose challenges for economies traditionally reliant on a robust working-age demographic to support economic growth and social welfare systems.

To counteract this growing imbalance between the workers and those who depend on them – the McKinsey report claims – these countries would need to amplify productivity growth by two to four times the current rates or encourage individuals to work an additional one to five hours weekly. Moreover, retirement systems may require adjustments, potentially directing up to 50pc of labour income to cover the increasing gap between the financial needs and the income of the elderly population.

In confronting the consequences of demographic change, societies enter uncharted waters, according to the report.

“Even if global fertility rates were to jump overnight to the replacement rate, it would take 20 years, give or take, for those additional babies to become adults and begin contributing to economic growth through work”, the report notes.

The bad news is that no country so far has been able to return to replacement levels after falling below. 

The report suggests that migration can play a role in addressing labour shortages but only for a short period of time because many developing countries, which currently supply a large share of migrants, are expected to experience their own demographic transitions, leading to reduced migration flows in the long term. 

Demands of employers can’t dictate childcare policy

 

A new survey from the Dublin Chamber of Commerce (DCC) finds that a lack of affordable childcare affects employers’ ability to attract new employees. Aebhric Mc Gibney of DCC was interviewed on Morning Ireland about the survey, and as usual no consideration was given to all the parents of young children, especially mothers, who would prefer to mind their children at home rather than put them in daycare. It is like the referendums of last March never happened.

The latest ‘Business Outlook Survey’ by the DCC found that childcare challenges impact almost nine-in-ten (88pc) businesses to some degree.

Childcare availability and costs affect workforce participation and productivity, as employees struggle to balance work commitments with parental responsibilities, says the DCC.

The DCC has asked the next Government to prioritise a public model of childcare. “Moving to a public model will be critical for ensuring a steady supply of affordable, quality childcare and building a more sustainable and diverse labour market,” said Mia Finnegan, Public Affairs Executive at Dublin Chamber.

Nonetheless, while employers’ concerns about childcare availability and costs are valid in their own narrow way, they should not be the sole determinant in shaping childcare policies.

A survey commissioned by The Iona Institute last year, and conducted by Amarach Research, revealed that more than two-thirds (69pc) of mothers with children under 18 would prefer to stay at home with their children if financial circumstances allowed. Furthermore, 76pc of these mothers feel that women who work in the home are undervalued by society. These findings suggest a strong inclination among mothers towards full-time caregiving, provided economic conditions are favourable.

We can’t expect employers to care too much about this very large group. They want everyone out working, after all, because that helps their businesses. But it can’t be the only consideration for Government policy in this area.

According to the DCC survey, companies are trying to accommodate the needs of employees who are also parents in various ways. For example, 74pc offer remote work options and/or providing flexible working hours (70pc) arrangements.

Over a third (36pc) allow part-time work or reduced hours for parents with childcare needs, while 31pc offer paid parental leave or additional leave options.

While businesses may advocate for enhanced public daycare services to support working parents, it is also crucial to acknowledge and respect the desires of many mothers and fathers to prioritise home-based caregiving. Part-time work, reduced hours and additional leaves would allow those who want to continue to be employed to balance their work and parental responsibilities.

A public model of childcare would not suit every family. Childcare policies should strive to accommodate the diverse needs and preferences of parents, and to repeat, the demands of employers cannot be the decisive factor in the debate about childcare. A comprehensive strategy that considers the preferences and needs of parents, particularly mothers, is essential for creating a supportive environment for all families.

Curbs on religious freedom remain high in much of the world

 

What is the current state of religious freedom in the world? The latest report from the prestigious Pew Research Centre finds, not good. The report covers 2022, and finds that curbs on religious practices and beliefs remained at high levels worldwide.

The study, which assesses government-imposed restrictions and societal hostilities towards religion across 198 countries and territories, found that restrictions remain widespread, with notable regional and national variations.

The study uses measures called the ‘Government Restrictions Index ‘(GRI) and the ‘Social Hostilities Index’ (SHI) to quantify restrictions. The GRI examines twenty forms of government action, such as banning religious groups or restricting preaching, while the SHI assesses thirteen indicators of societal hostility, including religious conflict and harassment, for example, when a mob attacks a church. The research draws on sources such as the US State Department’s annual religious freedom reports and other data from the Council of Europe and the United Nations.

The report showed no significant improvement from 2021. The GRI remained at 3.0 out of 10, its highest recorded level. Similarly, the SHI, which evaluates religion-related societal hostilities, held steady at 1.6. These may not sound high, because they are average figures, but there is huge variation by country. In China, for example, there are very extensive government restrictions on religion. In India, attacks by Hindu militants on Christians are commonplace.

Although the average global scores have not changed, the number of countries experiencing high or very high levels of government restrictions rose to 59 in 2022, up from 55 the previous year. This marks the highest figure since the study began in 2007.

The report found harassment of religious groups by governments or groups in society in 192 of the 198 countries surveyed.

This represents a record high, surpassing the 190 countries reported in 2021. Government harassment occurred in 186 countries, an increase from 183 in the prior year, while societal harassment affected 164 countries, a consistent figure from 2021.

Physical harassment, including assaults, property damage, and displacement, also rose. Incidents were reported in 145 countries, up from 137 the previous year. Both government actors and private individuals were equally likely to engage in such harassment, with incidents involving either group occurring in 111 countries.

The Middle East and North Africa remained the regions with the highest levels of government restrictions, with their median GRI score rising from 5.9 to 6.1. While the Americas reported the lowest levels, with a median GRI score falling from 2.1 to 1.8. Europe also saw a slight decrease, with its score dropping from 3.1 to 2.9.

Mind you, the score for Europe of almost 3 (the world average for government restrictions on religious freedom) throws up certain questions about the methodology. It makes it appear that Europe is quite a bad place for religious freedom in global terms, which is clearly not the case in general terms, unless having an Established Church, as in say, Britain, Greece or Norway, counts as something bad. Moreover, severe Government restrictions on religious freedom in places like Russia and Ukraine does drag up the score.

There is also growing societal hostility in some European countries towards certain religious groups, not least Jews. But in France (say), Christian churches are sometimes attacked.

Among the world’s 25 most populous nations, notable trends include China’s “very high” levels of government restrictions paired with “low” social hostilities. Vietnam and Turkey exhibited “very high” government restrictions and “moderate” levels of societal hostility.

While global averages remain steady, the record number of countries with severe government restrictions underscores the persistent challenges facing religious freedom worldwide. The steady rise in harassment, both by governments and groups, signals the need for continued vigilance and advocacy.

Regional disparities highlight the varying dynamics of religious restrictions. As the Middle East-North Africa region continues to experience the highest levels of government restrictions, countries like the United States and Canada maintain relatively low levels. However, global stability in these indices shows no significant progress.

This annual report offers a reminder of the ongoing struggles faced by religious communities globally and the critical need for international cooperation to uphold the principles of religious freedom.