Demographic Transition, Labour Markets and Regional Resilience

325 Pages·2017·12.687 MB·English

by  Cristina Martinez, Tamara Weyman, Jouke van Dijk (eds.)

Advances in Spatial Science
Cristina Martinez
Tamara Weyman
Jouke van Dijk Editors
Demographic
Transition, Labour
Markets and
Regional Resilience
Advances in Spatial Science
The Regional Science Series
Serieseditors
ManfredM.Fischer
Jean-ClaudeThill
JoukevanDijk
HansWestlund
Advisoryeditors
GeoffreyJ.D.Hewings
PeterNijkamp
FolkeSnickars
Moreinformationaboutthisseriesathttp://www.springer.com/series/3302
Cristina Martinez (cid:129) Tamara Weyman (cid:129)
Jouke van Dijk
Editors
Demographic Transition,
Labour Markets and Regional
Resilience
Editors
CristinaMartinez TamaraWeyman
SchoolofSocialSciencesand WesternSydneyUniversity
Psychology Penrith,NewSouthWales
WesternSydneyUniversity Australia
Penrith,NewSouthWales
Australia
JoukevanDijk
FacultyofSpatialSciences
UniversityofGroningen
Groningen
TheNetherlands
Waddenacademie
Leeuwarden
TheNetherlands
ISSN1430-9602 ISSN2197-9375 (electronic)
AdvancesinSpatialScience
ISBN978-3-319-63196-7 ISBN978-3-319-63197-4 (eBook)
DOI10.1007/978-3-319-63197-4
LibraryofCongressControlNumber:2017955843
©SpringerInternationalPublishingAG2017
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Foreword
Demographic transitions, the subject of this book, have been reshaping our econ-
omies, societies, politics and international relations for over two centuries. The
planetsawitspopulationexplodefrom1billionintheyear1800toover7billion
today, as mortality rates fell sharply thanks to improved hygiene, nutrition and
economic development. In more recent times, declining fertility rates have been
dragging down world population growth and, together with increasing life expec-
tancy, resulting in an ageing of our populations. Selective migration patterns also
occur within and between countries. As a result, some areas show a rapidly
increasingpopulationwhereasotherareassufferfrompopulationdecline.
The world’s different continents are at different stages of these demographic
transitions. Europe is the world’s “oldest continent”, despite the recent influx of
manyyouthfulrefugees,followedbyNorthAmericaandAustralia.Fromthecase
studiesinPoland,theNetherlandsandSweden,itbecomesclearthatwithinEurope
there are also substantial differences. Ageing in Sweden and the Netherlands is
comparablewiththeUnitedStatesandmuchlessseverethanintheSouth-European
countriessuchasSpainandItalywhicharecomparableinageingwithJapan.Asia,
theregion thathas experienced theworld’sfastesteconomicgrowth thispasthalf
century,isalsoexperiencingtheworld’sfastestrateofpopulationageing.
Asiaisuniqueinthatitalsohastheworld’sgreatest“demographicdiversity”.A
long period of fertility rates below the “replacement rate” of 2.1 children per
womanhasnowledtoaslowlydecliningpopulationinJapan,withadverseeffects
oneconomicgrowthandpublicbudgets.KoreaandTaiwanarebothfollowingthe
same pattern, as is China due in part to its one-child policy (now reformed into a
two-child policy). China’s demographic transition has been so abrupt that, in
contrast to its North East Asian neighbours, it will become old before it becomes
ahigh-incomecountry.
AttheotherendoftheAsianspectrumarecountrieslikeIndia,Indonesiaandthe
Philippines,whicharestillatanearlierstageintheirdemographictransitions.They
havelargeyouthbulgesnowenteringthelabourmarket,buttheseenergeticyoung
people are in desperate need of skills and training and jobs. Asia’s demographic
v
vi Foreword
diversityopensopportunitiesformutuallybeneficialmigrationfromlabour-richto
labour-poor countries. But most regrettably, apart from the low-fertility cases of
HongKongandSingapore,toofewcountriesareopeningtheirdoorstosignificant
immigration. Europe is now confronted with increasing migration from conflict
areasinAfricaandtheMiddleEast.Migrationofpeopleisalsorelatedtomigration
ofhumancapital.SomecitiesintheUnitedStatesshowingpopulationdeclineare
alsoconfrontedwithadeclineinstocksofhumancapital,whileothercitieswhich
havedepopulatedarestillaccumulatinghighereducatedindividuals.
All these demographic transitions are impacting different national regions and
cities to different extents and in different ways. This highlights the need for
governments at all levels, from the local to the regional and national, to respond
to the manifold challenges, with a response which is not one size fits all, but is
modulatedaccordingtothespecificityoftheregionorcity.
Internationalcooperationisalsobeingtestedbymigrationpressuresandcross-
border capital flows. Businesses must adapt and respond to changing labour
supplies. Trade unions and civil society organisations are having to represent the
interestsofadynamicallychangingdemography.Eachandeveryoneofusisnow
living in rapidly changing demography which is challenging social cohesion.
Thebookisauniquesourceofinformation,analysisandideasondemographic
change,labourmarkets andregional resilience.Countrycasestudies,oftenwitha
regionalfocus,coverEuropeancountrieslikePoland,theNetherlandsandSweden,
theUnitedStatesandAsia’sleadingeconomiesofChina,JapanandKorea.Issues
dealt with include urban and regional aspects, retirement security, labour markets
and productivity. The authors of each chapter are leading experts in their fields. I
canonlymakethemostunreservedrecommendationtomembersofallstakeholder
groupstotakethetimetobenefitfromtheirknowledgeandexperiencebyreading
thisexcellentvolume.
AsianCenturyInstitute JohnWest
Sydney,Australia
Introduction
Demographicchangeisauniversalfeatureofourtimes,affectingallcountriesatall
stagesofdevelopment.Theworld’spopulationisincreasing,butpopulationgrowth
rates are in decline. This slowdown is essentially due to falling fertility rates.
Meanwhile, in OECD countries, people are living longer. This means that the
distribution of age in the population is shifting, with proportionately fewer young
peoplethan olderpeople. Ageing isnotaproblem untoitself:Individualswantto
grow old. Overall, people are significantly healthier than in the past and enjoy
longer lifespans. However, the aggregate effect of population ageing and the
resulting changes to the population structure of many countries pose huge
challenges for their economies and their ageing populations, prompting multiple
questions(Newbold2015).1Willtherebethecapacitytosupportagrowingnumber
ofretireesandfundpensionsandlong-termhealthcarewithasmalleranddeclining
labour force? What are the economic benefits and costs of ageing at the local,
regionalandnationallevels?
Atthelocallevel,themain reason forpopulation ageingismigration,with the
outmigration of young workers to highly urbanised areas, leaving behind older
populations in less urbanised and rural areas. The net result is economic and
demographic decline compounded by an older and smaller population. This trend
isalreadycreatingpolicyandfiscalchallengesinsomecountries.Thelargerimpact
of demographic transition can be observed at the local level where institutions,
organisationsandthecommunityfeelthedynamicsofshrinkageandageingoftheir
labour markets. Despite the severity of the global trends and the difficulties in
reversing these trends in the short term, national and local institutions and
stakeholders can and should enhance their pathways for sustainable development
by smart management of their demographic transition. This book reviews these
1NewboldKB(2015)Populationaging:whatroleforregionalscience?AnnRegSci55:357–372.
doi:10.1007/s00168-015-0676-y
vii
viii Introduction
trends in a selection of countries and suggests strategic policies that need to be
implementedtomakelabourmarketsmoreresilientandmoreinclusive.
Demographic change is recognised worldwide as a fundamental policy
challenge facing not only national governments across the world, but due to its
greatercomplexityatlowerspatialscales,isevenmorechallengingforregionaland
local governments. Such demographic changes include falling fertility rates,
increased life expectancy, migration, population ageing, youth unemployment
andlocalisedpopulationshrinkage.Theseprocessesimpactthesizeandcomposi-
tion of the labour force, the stock of human capital and labour productivity. The
impactofdemographicchangeisselectivebyindividualsaccordingtoe.g.ageand
education and differs between urban and rural areas. As a result of these demo-
graphicchanges,strategicsolutionsmusttakeintoaccounttheinterplayofdifferent
elements, integrating the characteristics of the community, human capital, indus-
trial composition and social distribution (Martinez-Fernandez et al. 2012).2 As
illustrated in Fig. 1, sustainable and resilient communities rely on the complex
interaction of four key areas: population and health, such as ageing, fertility and
longevity; new sources of growth, such as the silver and white economies, entre-
preneurshipandinnovation; skillsecosystems,such asskillssupply development,
utilisationanddemand;andlabourmarkets,suchasemployment,unemployment,
ageingworkforceandskillsmismatch.Theperformancecharacterisationsofthese
factors depend on elements in other key areas. These are significant transitional
issuesfacinggovernmentsatalllevels,butespeciallyatthelocallevel,inmanaging
industrial development, job creation, welfare levels and sustainable development.
Thisprovidesaframeworkfortheanalysisinlaterchaptersofspecificregionalcase
studiesandchaptersthatanalysemorein-depthspecificissueslikesecuringincome
security for older (retired) people, spatial changes in the human capital stock and
changesinlabourproductivityrelatedtopopulationchange.
Thebookisdividedintoelevenchapters.Itstartswithtwogeneralchapters.In
Chap.1,thedemographicchangephenomenonisintroducedfromaninternational
perspective and where the challenges and impacts of demographic transition are
discussed and the need for suitable indicators to develop effective and efficient
policies. Chapter2examinesdemographic trends across OECD cities andregions
and discusses challenges facing different types of places and addresses the policy
dilemmasandconflictsatdifferentspatialscales.
After these general chapters, a series of five chapters presents a cross-country
analysisoftheimpactsofdemographictransitionsinEuropeandAsia,focusingon
thechallengesfacingregionalandlocalcommunitiesandwhatgovernmentsandkey
stakeholderscandotoprepareandanticipatethechangesorturnthemintooppor-
tunities.InEurope,theNetherlands,SwedenandPolandareanalysed.Acomparison
of these three countries is interesting, because the institutional setting, the spatial
scale,populationsizeandpopulationdensityareverydifferent.TheNetherlandsand
2Martinez-Fernandez C, Kubo N, Noya A, Weyman T (2012) Demographic change and local
development:shrinkage,regenerationandsocialdynamics.OECDPublishing,Paris.doi:10.1787/
9789264180468-en
Introduction ix
Fig. 1 Interplay of factors impacting demographic change. Source: Based on Martinez-
Fernandez, C.,Kubo, N., Noya, A., andWeyman, T., (2012), Demographic Change and Local
Development:Shrinkage,RegenerationandSocialDynamics,OECDPublishing,Paris
Sweden are both small in terms of population, but spatial scale and population
density are very different. Poland is much larger in terms of total population, and
it has a very different history of institutional and economic development. Across
Asia, results are presented for China and Japan which are also very different in
spatial scale and institutional and economic development. The following chapters
giveanin-depthanalysisofspecificelementsfromFig.1ofdemographictransition:
SouthKorea’slabourmarkettrendsamongolderworkersasanotherpillarofincome
security;theUnitedStates’decliningpopulationareasareassociatedwithadecline
ineducatedindividuals;andaneconometricanalysisofDutchdataontheeffectsof
ageing on labour productivity and the impacts on welfare. In Chap. 11, potential
instrumentsfordecision-makingandstrategicprioritisationofactionsareidentified
and related to strategic, coordinated policy responses involving local solutions,
based on policy themes that addresssustainabilityand inclusiveness ofthe labour
market.Next,wewilldescribethecontentsofthechaptersinmoredetail.
Chapter1byMartinezandWeymangivesanoverviewofthemajorworldwide
trends in demographic changes. Falling fertility rates, increased life expectancy,
migration, population ageing and localised population shrinkage are significant
policy challenges that national, regional and local governments are facing. This
chapter outlines the objectives of the study, illustrates the demographic transition
across the OECD and globally and highlights the complexity and interplay of the
factors impacting demographic change. In order to get an insight into these