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Demographic Window

 

What does ‘Demographic window’ mean?

   


State of the World Population 2002

Lower fertility and slower population growth temporarily increase the relative size of the workforce, opening an historic, one-time only demographic window. With fewer dependent children and older dependents relative to a larger, healthier working-age population, countries can make additional investments that can spur economic growth and help reduce poverty.

Within another generation, the window closes again, as the population ages and dependency increases once more. If jobs are generated for the working population, this demographic bonus results in higher productivity, savings and growth. In East Asia, for instance, where poverty has dropped dramatically, this demographic bonus is estimated to account for about one third of the regions unprecedented economic growth from 1965 to 1990.

This opportunity can be realized if countries have made the appropriate investments, not only in family planning, but in health and education generally, with special attention to the needs of girls and women, and in employment opportunities for the new and enabled workforce. Open and responsive governance makes these adjustments possible. Investments in health (including reproductive health) and education needs, and reducing gender inequality, have contributed to this effect. These investments attack poverty directly. They empower individuals, especially women. They enable choice and change.

Countries that have ignored the potential benefit have done less well. They have not made the necessary direct investments in poor people. They lack the good governance and social accountability that ensures that some of the benefits of economic growth go directly to the poor and towards alleviating poverty. The demographic window will close within a generation, as populations age, and with it a historic opportunity.

The big question for national leaders, legislators, policy experts and decision makers is whether to make the necessary changes in policy and practice in the next decade; and whether the international community will make the necessary efforts to help them succeed. If they do, women and men will be healthier and better educated. They will have access, among other things, to a full range of reproductive health information and services. Fertility and population growth will fall. The demographic window will be open for the next generation. Mass poverty could become a matter of history, not a threat to the future.

Regarding Egypt 's demographic transition, it is noted that death rates in Egypt have stabilized at a low level while fertility rates are continuing to drop due to increasing access to contraception, increasing age at first marriage, an increase in the status and education of women, etc. Also, it is noted that the total fertility rate (TFR) dropped 40 percent between 1980 and 2003. As a consequence, Egypt's population growth is decreasing while the relative size of Egypt’s potential labour force (15-64 years old) is slowly starting to increase in comparison to the size of the dependant population (those younger than 15 years or older than 65 years). Demographers call this period, in which the proportion of population of productive age is particularly high due to a nation's demographic evolution, the demographic window of opportunity.

The report states that such a demographic dividend is not automatic and requires a favorable policy environment. It goes on to say that Egypt is not yet profiting from the potential benefits its demographic window offers, and that absorption of skilled entrants in the labor market is particularly poor. Egypt is not yet successful in creating adequate employment due to weak export performance, insufficient economic diversification, insufficient domestic savings, limited investments, and an inflexible labour market in which working hours are rigid and firing of staff is difficult.

Among the recommendations emerging from the report were:

  • address widespread (digital) illiteracy;
  • strengthen educational and intellectual capacity;
  • spur and diversify exports;
  • promote labor intensive production;
  • double the domestic savings ratio;
  • strengthen the capacity of financial institutions to mobilize and invest savings;
  • enhance the investment climate (i.e. macro-economic stability, quality of institutions and flexibility of procedures and governance).

 

Demographic Changes Report

'Demographic Changes in Favour of Development in Egypt' is the second in a series of UNFPA-sponsored policy reports on emerging population issues, aimed at strengthening the evidence base for policy making. The report concludes with several statements on the need for Egypt to prepare for the situation following the demographic window, in which it will have to deal with an aging population and an increasing dependency ratio.