Demographic change from a European perspective
- An adaptive leadership challenge

Johannes Meier, Ph.D.

Boston, 8 May 20...
Demographic Change




              This could not have happened with a family!



                                      ...
Demographic Change




Agenda


    Higher life expectancy and declining fertility are not new trends
    Demographic chan...
Demographic Change




Agenda
Higher life expectancy and declining fertility are not new
trends
    Higher life expectancy...
Demographic Change




Demographic trends are long-term phenomena in their
genesis and impact – and are not over yet


   ...
Demographic Change




Relevant global trends


  More old people!
  They’re living longer!
  The number of first-time mar...
Demographic Change




As wealth increases, the birth rate falls at first

   Children per woman




                     ...
Demographic Change




Declining fertility in Germany

   Children per woman




The fertility rate is defined as the aver...
Demographic Change




Growth segment elderly:
Germany 2000-2050 (per 100 persons in 2000)
 200

 180

 160

 140

 120

 ...
Demographic Change




France 2000-2050 (per 100 persons in 2000)

 200

 180

 160

 140

 120

 100

  80

  60
        ...
Demographic Change




Poland 2000-2050 (per 100 persons in 2000)

 200

 180

 160

 140

 120

 100

  80

  60
        ...
Demographic Change




China 1950-2050 (%)

 25


 20


 15


 10


  5


  0
        1950       1960       1970       198...
Demographic Change




The bad news: fewer people of working age ceteris
paribus

                                        ...
Demographic Change




Agenda
Demographic change will intensify cohesion issues of the
German society over the next few ye...
Demographic Change




1. How robust is intergenerational cohesion?

24.500
                          under 20           6...
Demographic Change




State spending and income 2004 and
population profile 2004
                      1.600             ...
Demographic Change




State spending and income 2004 and
population profile 2020
                      1.600             ...
Demographic Change




State spending and income 2004 and
population profile 2030
                      1.400             ...
Demographic Change




Complication: lack of accruals for pension obligations

                                           ...
Demographic Change



2. How robust is regional cohesion?

                      Below 20 years of age   1991             ...
Demographic Change



2. How robust is regional cohesion?

                      Below 20 years of age   2020             ...
Demographic Change




Shrinkage and growth are found in close proximity


Population trend 2003-2020
in towns and municip...
Demographic Change




The age quotients (%) in the municipalities will change
dramatically even by 2020
                 ...
Demographic Change




3. How is Germany tackling the integration task?


80                                              ...
Demographic Change




Graduation rates of German and immigrant youths
in 3-tier school system in percent

  50
  45      ...
Demographic Change


Children’s desired educational level: Percentage of
children who hope to graduate from a Gymnasium, b...
Demographic Change




From postponing the problems into the future to
encouraging more co-responsibility from the generat...
Demographic Change




Agenda
The global demographic trend is calling for new
mechanisms of resource allocation and accele...
Demographic Change




Global projection for 2050
   2050: 9.1 billion people
   Trebling in Afghanistan, Burkina Faso, Bu...
Demographic Change




1. complication: Shrinking periods for adjusting to ageing

Number of years for percentage of popul...
Demographic Change




2. complication: Do old societies have enough
“creative bite”?
 180.000

 160.000                  ...
Demographic Change




3. complication: The link between demography and
climate change
1. Scenario 2050
Developed countrie...
Demographic Change




Agenda
The need for adaptive leadership to deal with
demographic change
    Higher life expectancy ...
Demographic Change




The life of a Thanksgiving turkey


                                                               ...
Demographic Change




Demographic change calls for adaptive leadership



Nature of challenge                            ...
Demographic Change




Dimensions of adaptation:
1. New forms of living and service delivery
Sun City, Arizona            ...
Demographic Change




Dimensions of adaptation:
2. Leverage of technologies
                      Nursing care robots, ex...
Demographic Change




Dimensions of adaptation:
3. A developmental psychology viewpoint

                                ...
Demographic Change




The individual’s development opportunities depend on
the structure of the individual’s resources


...
Demographic Change




How can the ethics of a successful life be given a more
concrete form in the face of demographic ch...
Thank you for your attention




johannes.meier@bertelsmann.de
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Demographic Change from a European Perspective - An Adaptive Leadership Challenge

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Presentation by Johannes Meier given at Tufts University, May 2008.

Higher life expectancy and declining fertility are not new trends.
Demographic change will intensify cohesion issues of the German
society over the next few years.
The global demographic trend is calling for new mechanisms of
resource allocation and accelerated adaptation processes.
Deal constructively with demographic change calls for adaptive leadership.

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Demographic Change from a European Perspective - An Adaptive Leadership Challenge

  1. 1. Demographic change from a European perspective - An adaptive leadership challenge Johannes Meier, Ph.D. Boston, 8 May 2008
  2. 2. Demographic Change This could not have happened with a family! page 2
  3. 3. Demographic Change Agenda Higher life expectancy and declining fertility are not new trends Demographic change will intensify cohesion issues of the German society over the next few years The global demographic trend is calling for new mechanisms of resource allocation and accelerated adaptation processes The need for adaptive leadership to deal with demographic change page 3
  4. 4. Demographic Change Agenda Higher life expectancy and declining fertility are not new trends Higher life expectancy and declining fertility are not new trends Demographic change will intensify cohesion issues of the German society over the next few years The global demographic trend is calling for new mechanisms of resource allocation and accelerated adaptation processes The need for adaptive leadership to deal with demographic change page 4
  5. 5. Demographic Change Demographic trends are long-term phenomena in their genesis and impact – and are not over yet Norway New Zealand Iceland Sweden Japan Netherlands Switzerland Australia Life expectancy for women (in the country where the expected figure was highest in each year) Source: MPI Rostock, 2005 page 5
  6. 6. Demographic Change Relevant global trends More old people! They’re living longer! The number of first-time marriages is falling. The age of those marrying for the first time is increasing. The average age of first-time mothers is increasing. More babies are being born out of wedlock. The number of divorces is increasing. More women are active in the world of work. Inequalities within and between countries are increasing. The total fertility rate is declining. Demographic change must be analyzed in the context of sociological, technological and economic megatrends. page 6
  7. 7. Demographic Change As wealth increases, the birth rate falls at first Children per woman Bangladesh France Germany The fertility rate is defined as the average number of births per women (age-specific birth figure, total fertility rate) Source: World Bank, 2001 page 7
  8. 8. Demographic Change Declining fertility in Germany Children per woman The fertility rate is defined as the average number of births per women (age-specific birth figure, total fertility rate) Source: Institut für Bevölkerungsforschung und Sozialpolitik, 2001 page 8
  9. 9. Demographic Change Growth segment elderly: Germany 2000-2050 (per 100 persons in 2000) 200 180 160 140 120 100 80 60 2000 2010 2020 2030 2040 2050 65+ 15-64 high variant (an additional fertility of 0.5 children) Source: Heran, 2007 page 9
  10. 10. Demographic Change France 2000-2050 (per 100 persons in 2000) 200 180 160 140 120 100 80 60 2000 2010 2020 2030 2040 2050 65+ 15-64 high variant (an additional fertility of 0.5 children) Source: Heran, 2007 page 10
  11. 11. Demographic Change Poland 2000-2050 (per 100 persons in 2000) 200 180 160 140 120 100 80 60 2000 2010 2020 2030 2040 2050 65+ 15-64 high variant (an additional fertility of 0.5 children) Source: Heran, 2007 page 11
  12. 12. Demographic Change China 1950-2050 (%) 25 20 15 10 5 0 1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050 Percent of elderly (65+) Source: World Population Prospects: The 2004 Revision (2005) page 12
  13. 13. Demographic Change The bad news: fewer people of working age ceteris paribus 20 % 17 % 16 % 16 % 2000-2020 2020-2050 7% 2% 2% -5 % -7 % -9 % -14 % -13 % -21 % -28 % USA Canada UK France Germany Japan China Quelle: U.S. Census Bureau International Data Base page 13
  14. 14. Demographic Change Agenda Demographic change will intensify cohesion issues of the German society over the next few years Higher life expectancy and declining fertility are not new trends Demographic change will intensify cohesion issues of the German society over the next few years The global demographic trend is calling for new mechanisms of resource allocation and accelerated adaptation processes The need for adaptive leadership to deal with demographic change page 14
  15. 15. Demographic Change 1. How robust is intergenerational cohesion? 24.500 under 20 65 and older 22.786 22.240 21.615 21.000 18.219 17.500 16.589 17.259 14.066 15.524 14.000 14.552 13.927 12.874 12.094 10.500 2001 2010 2020 2030 2040 2050 The population of Germany by age group (in thousands) medium life expectancy, medium migration balance Source: Federal Statistical Office 2003, 10th coordinated population projection, variant 5 page 15
  16. 16. Demographic Change State spending and income 2004 and population profile 2004 1.600 25.000 € 1.400 20.000 € 1.200 Population in 1,000 1.000 15.000 € 800 600 10.000 € 400 5.000 € 200 0 0€ 1 5 9 13 17 21 25 29 33 37 41 45 49 53 57 61 65 69 73 77 81 Age Population 2004 Taxes and contributions per head Transfer payments and state consumption per head page 16
  17. 17. Demographic Change State spending and income 2004 and population profile 2020 1.600 25.000 € 1.400 20.000 € 1.200 Population in 1,000 1.000 15.000 € 800 600 10.000 € 400 5.000 € 200 0 0€ 1 5 9 13 17 21 25 29 33 37 41 45 49 53 57 61 65 69 73 77 81 Age Population 2020 Taxes and contributions per head Transfer payments and state consumption per head page 17
  18. 18. Demographic Change State spending and income 2004 and population profile 2030 1.400 € +285 bn 25.000 € 1.200 20.000 € Population in 1,000 1.000 800 15.000 € 600 10.000 € 400 5.000 € 200 0 0€ 1 5 € -118 bn 21 25 29 33 37 41 45 49 53 57 61 65€ 69 73bn 81 9 13 17 -403 77 Age Population 2030 Taxes and contributions per head Transfer payments and state consumption per head page 18
  19. 19. Demographic Change Complication: lack of accruals for pension obligations 123 125 117 99 88 70 66 58 50 53 34 19 11 15 6 7 9 5 4 4 3 AU K S H L O FR BE ES SE Z JA A K E IS IE AT FI IT D N N U U C D D C N EC O Pension fund savings, % GDP, international, 2005 Source: Salverda 2007, OECD page 19
  20. 20. Demographic Change 2. How robust is regional cohesion? Below 20 years of age 1991 Over 60 years of age Share of total population accounted for by age groups in % under 17 20 - 23 26 - 29 32 and above 17 - 20 23 - 26 29 - 32 Source: BBR page 20
  21. 21. Demographic Change 2. How robust is regional cohesion? Below 20 years of age 2020 Over 60 years of age Share of total population accounted for by age groups in % under 17 20 - 23 26 - 29 32 and above 17 - 20 23 - 26 29 - 32 Source: BBR page 21
  22. 22. Demographic Change Shrinkage and growth are found in close proximity Population trend 2003-2020 in towns and municipalities with more than 5,000 inhabitants (in %) very strongly declining (under -12) strongly declining (-12 to under -7) slightly declining (-7 to under -2) stable (-2 to under 2) slightly increasing (2 to under 7) strongly increasing (7 to under 12) very strongly increasing (12 and more) Source: Wegweiser Demographischer Wandel (2006) page 22
  23. 23. Demographic Change The age quotients (%) in the municipalities will change dramatically even by 2020 2003 2010 2015 2020 All German municipalities > 5,000 inhabitants (n=2,959) 0–18 years 65 years and older Source: Bertelsmann Stiftung, Wegweiser Demographischer Wandel 2006 page 23
  24. 24. Demographic Change 3. How is Germany tackling the integration task? 80 900 75 600 70 300 65 0 1980 1970 1990 1960 2000 -300 Population (m) Migration balance (in thsd.) Actual population trend Natural population trend Migration balance (excl. migration) Source: Eurostat, Federal Statistical Office page 24
  25. 25. Demographic Change Graduation rates of German and immigrant youths in 3-tier school system in percent 50 45 42 42 40 35 31 30 25 25 25 20 18 15 10 8 8 5 0 upper tier middle tier lower tier drop outs Germans Immigrants Quellen: Statistisches Bundesamt, Abgänger 2004/2005 page 25
  26. 26. Demographic Change Children’s desired educational level: Percentage of children who hope to graduate from a Gymnasium, by socioeconomic background (Surveyed: 8- to 11-year-olds) 100% 81% 80% 68% 60% 40% 36% 32% 20% 20% 0% Lower class Lower middle Middle class Upper middle Upper class class class Source: 2007 World Vision study on children page 26
  27. 27. Demographic Change From postponing the problems into the future to encouraging more co-responsibility from the generations Operational challenges Transparency and accountability Critical question Consolidation and expansion of the “room to maneuver”; debt limitation How can generations of automatisms politicians and citizens who were socialized in the distribution Regional differentiation of the mode face up to today’s practical adaptation strategies challenges that derive from a long-term logic? Early integration of children with migration backgrounds and from population strata with low parental education level page 27
  28. 28. Demographic Change Agenda The global demographic trend is calling for new mechanisms of resource allocation and accelerated adaptation processes Higher life expectancy and declining fertility are not new trends Demographic change will intensify cohesion issues of the German society over the next few years The global demographic trend is calling for new mechanisms of resource allocation and accelerated adaptation processes The need for adaptive leadership to deal with demographic change page 28
  29. 29. Demographic Change Global projection for 2050 2050: 9.1 billion people Trebling in Afghanistan, Burkina Faso, Burundi, Chad, Congo, East Timor, Guinea-Bissau, Liberia, Mali, Niger and Uganda More than half of the absolute growth will be in India, Pakistan, Nigeria, Congo, Bangladesh, Uganda, the USA, Ethiopia and China alone (countries sorted by absolute growth) Ratio of population numbers in developed/non-developed regions will develop from 1:2 in 1950 to 1:6 in 2050 Developed countries Less developed countries Slowdown in economic growth Environmental and resource problems due to the overburdening of urban regions Cost dynamics in the health, nursing care and pension systems Costs of ageing and nursing care accumulate before the creation of a capital stock Risk of innovation deficiencies At the same time, relatively high “revolutionary” potential page 29
  30. 30. Demographic Change 1. complication: Shrinking periods for adjusting to ageing Number of years for percentage of population aged 65 or more to rise from 7% to 14% More developed countries Less developed countries France 1865-1980 115 Azerbaijan 2000-2041 41 Sweden 1890-1975 85 Chile 1998-2025 27 Australia 1938-2011 73 China 2000-2026 26 United States 1944-2013 69 Jamaica 2008-2033 25 Canada 1944-2009 65 Tunisia 2008-2032 24 Hungary 1941-1994 53 Sri Lanka 2004-2027 23 Poland 1966-2013 47 Thailand 2003-2025 22 United Kingdom 1930-1975 45 Brazil 2011-2032 21 Spain 1947-1995 45 Colombia 2017-2037 20 Japan 1970-1996 26 Singapore 2000-2019 19 Source: K. Kinsella and Y.J. Gist, Older Workers, Retirement and Pensions: A Comparative International Chartbook (1995) and K. Kinsella and D. Phillips, “The Challenge of Global Aging,” Population Bulletin 60, no. 1 (2005). page 30
  31. 31. Demographic Change 2. complication: Do old societies have enough “creative bite”? 180.000 160.000 USA 140.000 120.000 100.000 80.000 Germany 60.000 40.000 20.000 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 Patent applications of domestic origin Source: German Patents and Trademarks Office 2002 page 31
  32. 32. Demographic Change 3. complication: The link between demography and climate change 1. Scenario 2050 Developed countries: -40% CO² Developing counties: same CO²/per capita Future? Total emissions at current level Likely global warming: 2. Scenario 2050 Regionally different impacts Developed countries: no reduction CO² Developing counties: double CO²/per capita Floodings Total emissions + 90% Droughts Migration waves 3. Scenario 2050 Developed countries: -40% CO² Developing counties: double CO²/per capita Total emissions + 66% page 32
  33. 33. Demographic Change Agenda The need for adaptive leadership to deal with demographic change Higher life expectancy and declining fertility are not new trends Demographic change will intensify cohesion issues of the German society over the next few years The global demographic trend is calling for new mechanisms of resource allocation and accelerated adaptation processes The need for adaptive leadership to deal with demographic change page 33
  34. 34. Demographic Change The life of a Thanksgiving turkey Surprise!! 6 kg 5 kg 4 kg Weight 3 kg 2 kg 1 kg 0 kg Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Source: N. Taleb, The Black Swan page 34
  35. 35. Demographic Change Demographic change calls for adaptive leadership Nature of challenge Who does the work? Not just technical; application of Authorities/traditional regulation current know how not enough architectures are stressed Adaptive challenge: Adaptive leadership needs to bring in We need to learn new ways the people with the problem • Young immigrant leaders • Municipal leaders • Aging citizens, i.e. everybody Source: R.Heifetz/M.Linsky: Leadership on the Line page 35
  36. 36. Demographic Change Dimensions of adaptation: 1. New forms of living and service delivery Sun City, Arizona www.pflegeinthailand.de Voluntary segregation of the elderly 24-hour care for Alzheimer’s patients, residence, catering and support for approx. € 1,300 per month page 36
  37. 37. Demographic Change Dimensions of adaptation: 2. Leverage of technologies Nursing care robots, exoskeletons, and artificial intelligence for monitoring the elderly are being developed, especially in Japan. Paro – a therapeutic robot for cognitive illnesses, which can behave and move proactively and reactively by means of artificial intelligence. Caregivers Assistant (Intel Research Seattle, USA) analyzes behavior and gives out warning signals by means of RFID chips on everyday objects. page 37
  38. 38. Demographic Change Dimensions of adaptation: 3. A developmental psychology viewpoint Self-Pragmatics Cog. Pragmatics Performance Self-Mechanics Cog. Mechanics Idealized Lifespan Curves ca. 25 ca. 75 Life Course Life Mechanics Life Pragmatics := biology-based patterns of perception, information := the factual and procedural „knowledge“ about the world processing, emotionality, motivational expression and one‘s self gained through interactions with life contexts Source: Staudinger 2007 page 38
  39. 39. Demographic Change The individual’s development opportunities depend on the structure of the individual’s resources Plasticity Development path Plasticity Cultural and biological resources Options for new work Educational histories Social commitment Lifestyle Childhood Old age Source: Staudinger 2007 page 39
  40. 40. Demographic Change How can the ethics of a successful life be given a more concrete form in the face of demographic change? Television consumption in minutes per day in Germany 250 234 195 197 181 168 14-29 Y. 30-39 Y. 40-49 Y. 50-59 Y. 60-69 Y. 70+ Y. Source: Media-Perspektiven 6/2005 page 40
  41. 41. Thank you for your attention johannes.meier@bertelsmann.de

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