Sometimes we try to make simple things more complicated than they need to be. N.C. State University economist Mike Walden says economists do this sometimes, too, and as a result tend to overlook a simple factor related to economic improvement.
“The simple point is that if you are going to have an economy that is growing, you need more workers. And so one of the simple things I think we can overlook is what is going to be the forecast for growth in your working age population in a country. And there should be a correlation between that growth rate and the future economic growth of that country.
“So when we look around the world and we say, ‘What countries are going to have the biggest increases in their workforce?’ we see it is countries like India, Indonesia, Mexico, Brazil. Those are all countries that are forecast to have the biggest growth in working age population, and therefore many economists think those are going to be fastest growing countries.
“Interestingly, the U.S. is forecasted to have an increase in its working age population — not as much as those countries I just mentioned.
“Now there are some countries that are going to go in the opposite direction. And I think economic growth for them will be very challenged. These are countries where the working age population is expected to go down, and these are countries like Russia, Japan and Germany. And interestingly China is going to be about staying in neutral — very little, very small increase in their working age population. So despite all the hoopla about growth in China, it may be a challenge for them down the road.”