The world is in the midst of a profound demographic transformation as countries in Europe, North America, and parts of Asia grapple with the potent combination of an aging population and declining birth rates. Meanwhile, countries in other parts of the world, such as Africa, are seeing their populations surge. The New York Times documented these trends in a 2023 piece that shows how the world is projected to change in the coming decades. These demographic shifts will have significant impacts on the retirement systems of countries that are rapidly aging and may force nations to rethink how they structure and fund their retirement plans.
This demographic shift is being driven by the aging of populations in many advanced economies. With longer life expectancies and lower birth rates, many of these countries are experiencing an increasing proportion of elderly citizens compared to their working-age populations. The U.S. Census Bureau projects that by 2034, there will be more senior citizens than children for the first time in American history. This transition has major implications for the sustainability of retirement systems, as it places greater financial pressure on governments, individuals, and employers to provide for retirees.
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