How will the next billion earn a living? LINKEDIN | 22 NOVEMBER, 2016

The world is adding about 130 million new-borns every year. So, every 10-12 years, a billion people will enter the workforce. Where will the next billion find their livelihood? There are three big current trends that do not seem to have any intersection point:

1. a. Several societies are ageing rapidly
2. b. Youth population in developing countries is very large and growing
3. c. Globalisation has given way to anti-immigration mind-set

After Japan, many of the European nations, Singapore and Australia are ageing fast. The dependency ratios are moving alarmingly. These societies have the double whammy of slow birth rates and longevity, an unsustainable balance in the long run. Countries like India, Bangladesh, Pakistan, Indonesia, many in Africa and Latin America have seen a baby boom in the past two decades that is bringing millions into the workforce every year. These countries unfortunately, are not creating enough jobs. In the 90s and early 21st century, globalisation had engulfed our societies. People moved around for jobs, besides jobs moving around to lower-cost countries. Both are bad themes today (Brexit, DJT’s election premise). Apart from humanitarian considerations, the work visa regime in most countries is still tight and perhaps tightening further. So where will the additional workforce go to earn a living and how will ageing societies manage without young hands and legs?

A selfish world may have dawned. The precarious imbalance does not seem to have an immediate solution unless pragmatic immigration policies and their backers succeed with voters. The demand supply disequilibrium, in the meantime, will take its toll in the form of unrests (due to lack of employment), high costs (to maintain ageing economies) and continued health and education challenges in third world countries. Parties in government will suffer voter revolt and protectionism chorus will rise. As economists and demographers battle this problem, should we give a chance to IBM Watson or an AI genie to find solutions?