Britain’s population timebomb defused?

BabyUnpredicted and unannounced Britain now finds itself right in the middle of an extraordinary new baby boom, a fresh bulge-generation that will help shape our country for the rest of the 21st Century. Has Britain cheated demographic destiny?

Our attention was elsewhere, on doom-laden coverage of our greying nation and looming pensions nightmare. This has drowned out the occasional report of primary schools and maternity wards bursting at the seams.

The facts are striking. Nationally, births have risen by more than 20% in less than a decade. The sharpest rise this country has seen in two generations. The number of births has already surpassed the mini-peak of 1990 (when the original post-war baby boomers had their children), and is now the highest it’s been in 40 years. In places, particularly London, the change has been even more dramatic; Barking and Dagenham’s births are up by an incredible 55%. And all this in a nation supposedly entering its dotage?

Positive Ageing

The ageing isn’t a myth of course. There has been an astonishing growth in life expectancy – rising steadily by almost 3 months every year with no sign of easing off – leading some even to start questioning the idea of a limit to human lifespan. This is permanently changing the shape of our population. The 21st Century started with 6,800 Britons aged 100 or more, but by 2066 we can expect to have half a million centenarians.

Contrary to the media coverage this is clearly good thing, we’re gaining healthy and active years. The “pensions crisis” is a different issue and one entirely of our own making – we are living longer but remain stubbornly in denial about the need to work longer.

But now it turns out that ageing is only part of the story. Two other dramatic changes have happened to reshape our population in unexpected ways.

Importing a generation

Firstly we have back-filled the “missing generation”, the small cohort that followed the original baby boom has had its numbers made up through immigration. In 1977, as the Queen celebrated her Silver Jubilee, births hit a post-war low with fewer than 570,000 born in England and Wales. But look at that cohort today, aged 34, and their number has swollen by 100,000.

All told, migration has added perhaps a couple of million to the number of 30 and 40 somethings in Britain. This means the peak of the post war baby boom – 800,000 people aged 44 in 2011 – now looks less of a peak, almost matched by the number of 26 year olds.

The other big demographic shock is the sudden surge in births, which has already given us nearly a million more children than expected at the turn of the millennium.

It is tempting to link the two, immigration and births. Certainly a high proportion of births are to women born abroad (about a quarter), partly because immigrants tend to be young adults at the age to start families. But it’s broader than this, and seems to apply across ethnic, social and age groups – we’re simply having altogether more children. Fertility rates in the UK have actually risen faster for women born here, than those born abroad.

Future prospects

Where is this going? For most of the last ten years, as births rose, official forecasts resolutely assumed it was a blip, to be reversed the following year. Yet each time the numbers marched resolutely on upwards. Demographic forecasting has gloriously hopeless record and the end of this boom will take us just as much by surprise as the start did. However, unless births fall back rapidly, the number of newborns could come close to matching the bulges of people in their mid 20s and mid 40s.

What does this mean for the UK? Firstly, and most urgently, it means we need to embark on one of the biggest school building programmes since the late Victorian School Boards (see my previous blog).

It may also mean more crime. Both for victims and perpetrators, crime is most common amongst people in their late teens and early 20s. This group will be growing rapidly ten to fifteen years from now.

But overall, the benefits of a more stable and youthful population beat the costs of a shrinking, ageing one. A more balanced population outlook is likely to have all sorts of interesting and unpredicted effects, from savings rates and asset prices to tax takes, house prices, culture and politics.

Perhaps most importantly, these changes have arrived just in time to soften the impact of ageing. Just a decade ago, we tended to think of the post war boomers as a huge bulge – the “pig in the python” – working its way up through the generations. Now the demographic gap behind the boomers is filling up through births and immigration, it’s possible the workforce could even keep growing when the original baby boom retires.

The effect is seen in the charts below, showing how much the shape of our population has changed in just ten years.

Beating the bulge – Forecast and Actual British Population in 2010 (ONS/GAD)

2010 Population Pyramids for Great Britain

This matters hugely. The “demographic dividend”, a high-growth economic sweet spot when a country has lots of workers but few children or elderly dependants, can turn to economic stagnation as these workers retire. Something like this may be happening now in ageing Japan, and other “bulge” countries may follow suit in the next few decades, including Germany and Italy, and further ahead perhaps even China.

If Britain has cheated this demographic fate it could give the country a relative economic advantage through the rest of the 21st century.

August Comte famously claimed “demography is destiny”, in which case the two huge population shocks of the last decade – immigration and births – could mean Britain’s destiny has brightened unexpectedly.

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2 thoughts on “Britain’s population timebomb defused?

  1. Pingback: The True Scale of the Housing Crisis | Barney's Blog

  2. Pingback: Demographics Are Not Destiny | Joyante's Blog

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