I read so many articles citing population growth as a given for greater consumption or further economic growth. I think before someone throws out this canard as the means for economic or environmental or political action, some basic information on the topic is due.
First, no shocker the human race has grown spectacularly, particularly since 1850 from 1.3 billion to today's 7.6 billion inhabitants (chart below). This period of atypical spectacular growth is all that everyone alive has ever known...so a shared frame of reference that believes this to be "normal" is understandable. This period has so warped thinking that most mainstream economists believe economic growth is the increase in the inflation-adjusted market value of the goods and services produced by an economy over time. The great assumption made is that ever greater economic capacity and production will perpetually be met with rising demand. If nations can only funnel ever more investment to create perpetually higher capacity and production, the system will thrive...so goes this "logic". However, simply put, I'll show the Fed and global central banks are attempting to accelerate the creation of new and/or better production / capacity (via interest rate cuts and cheapening debt service) into a natural deceleration of new consumers.
Population Growth has primarily shifted to Africa; only Africa is experiencing accelerating annual population growth while all other regions have decelerating growth.
African's have minimal disposable income, savings, or access to credit
Africa consumes very little, relative to developed nations (15% of worlds population consumes just 4% of global oil)
Immigration from Africa (particularly Sub-Saharan Africa where rapid population growth is taking place) has historically been and continues to be very low, relative to other regions
The mismatch of nearly all population growth in a location that does not drive any significant consumption / economic growth nor provides significant immigrants means practically speaking, Africa is economically a non-factor and excluding Africa, global population and economic growth is nearly at an end.
Central banks interest rate policy has consistently followed the child bearing population (x-Africa) and an implementation of ZIRP is imminent as the childbearing population (x-Africa) is on the verge of beginning to contract.
Total World Population
Since 1700, total population has risen 10 fold. However, the accelerating rate of growth from 1850 ended abruptly around 1970, with an equally rapid decelerating rate of growth since. Those simply looking at the total population may have missed this small detail that means so much.
Peak annual population growth took place in the late 1980's adding in excess of 90 million per year (chart below). Splitting the world in five roughly equal groupings, population growth has decelerated by about 10 million per year while the geographical sources of that growth have significantly changed (away from E. Asia and Europe/N. America/Australia), decelerating S. Asia, and accelerating Africa). Population growth would be far greater except for Africa's significantly shorter life expectancy (60 versus nearly 80 in N. America).
Looking at those geographical annual sources of growth, it should be apparent all are decelerating save for one, Africa (chart below). The chart below highlights global fertility rates for 2016....where the global population growth is coming from. Simply, a bulls-eye on Sub-Saharan Africa.
Looking at annual growth (2017 through 2050, chart below), Africa's accelerating growth is prominent versus the deceleration everywhere else. Africa Oil Consumption But Africa doesn't consume like the rest of the world. The chart below details Africa's minimal increase in oil consumption versus India and China (of similar size) from 1980 through 2015. In 1990, Africa and China nearly consumed the same quantity of oil. Since 1990, China has nearly quintupled oil consumption while Africa has less than doubled. To give some perspective, consider Saudi Arabia and its 33 million citizens consume more oil than Africa's 1.2 billion. African Purchasing Power Parity According to the World Bank, the average per capita income in Sub-Saharan Africa (SSA) was essentially unchanged from 1993 through 2008, from $742 to $762 per capita. In 1993, 25% of the worlds poorest 5% lived in SSA; by 2008 60% of the worlds poorest 5% lived in SSA. The majority of Sub-Saharan African's spend up to 75% on their income solely on food. Things have only worsened since 2008. Given commodities are priced globally in dollars, African's and particularly the huge growing population of the SSA simply have no means to be consumers and frankly have bigger concerns than the global economy.
Below, GDP per capita or purchasing power parity (PPP). Countries with low PPP in red (Central Africa), moderate in green, high in blue, and very high in magenta. Most global commodities and exports cost the same worldwide...so those with high PPP's (and particularly those with relatively easy access to credit) can consume far more than those with low PPP's. The bulk of nations highlighted in red (particularly in Africa) have PPP's below $2000 a year...(and as low as $400/yr). Nations with PPP's of $2000 year are generally in-line with the GDP per capita of Haiti and a third the PPP of Cuba...and about 4% of US GDP per capita.
Total births by region per 5 year periods
The declining number of births everywhere but Africa should be obvious (chart below).
Births per region by five year periods. Again, everywhere but Africa declining...
Europe/N. America/Oceania declining since 1960 despite the massive influx of immigrants
East Asia (China, Japan) declining since 1970
South Asia (India) declining since 2000
Rest of the World (ROW) peaking now
There is only one oar in the water from a population growth standpoint...Africa. And like a rowboat with a single oar, there is much commotion but ultimately the boat goes nowhere.
Child Bearing Population Economic growth is really simple, add up the change in the quantity of people over a period versus their savings, income, and access to credit...and that represents the change in demand. Funny enough, the Federal Reserve seems to agree with me since their Federal Funds Rate seems to mirror the change in the global child bearing population (x-Africa). The chart below shows the change in the 15-40yr/old global childbearing population (per five years) versus the five year average of the Federal Funds % rate. It really couldn't be a nicer match. So those curious where the FFR is going, simply look at the child bearing population (x-Africa) over the next decade and the there should be little guessing that the implementation of NIRP (negative interest rate policy) is upcoming.
One more look but showing total global population (x-Africa) and global population growth rate (x-Africa) versus the Federal Funds Rate and total global debt. The rates were hiked with the accelerating growth, cut with the deceleration of population growth, and will go negative with the imminent outright decline in global childbearing population (x-Africa).
Even the most inclusive definition of the childbearing female population of 15 to 49 year olds has begun the peaking process while the global birth rate, excluding Africa, is negative and continuing to fall further. A waterfall event is possible (likely?) as the combination of a declining quantity of childbearing females (x-Africa) and a deepening negative fertility rate meet up in the coming decade.
Global 0-45yr/old population (x-Africa) versus global births per five year periods (x-Africa). The next leg down is likely imminent.
Childbearing change per five years, by region.
The chart below highlights what the 0-5yr/old population (x-Africa) and 0-5yr/old African population will likely look like through 2050.
Just for reference, the chart below shows annual population change of combined Europe / N. America / Oceania versus East Asia (China, Japan, N/S Korea, Taiwan).
Again for reference, annual population change of Africa versus South Asia.
Sources of Global Migration
Since the sources of population growth should be clear, then understanding the sources of migration is pretty critical. The chart below shows the primary sources of migration, per five year periods, by global region. Some key takeaways 1950->2015:
Sub-Saharan Africa has been a relatively insignificant source of immigration since the 1980's...and even then it never rivaled the migrations from Latin America (primarily Mexico) or presently from S. Asia. Essentially, what happens in Sub-Saharan Africa stays in Sub-Saharan Africa.
Northern Africa has been a more significant source of migration since the 1990's but the regions birthrates (2.8 children per female) are falling more in-line with Europe than Sub-Saharan Africa (4.9 children per female).
Latin America was the primary source of migration but this has hugely decelerated, with Mexico experiencing a 10 fold decrease in immigration since 2005.
The S. Asia region, (primarily India, Pakistan, Bangladesh) are producing the bulk of the worlds migrants.
Nations like Bangladesh, Pakistan, or Mexico have consistently seen migrations on par with the far larger and faster growing Sub-Saharan African region. A breakdown of the regions that are the recipients of those immigrants...led by N. America (Canada/US), Western Europe, Western Asia (despite the huge outflows from Syria, even larger inflows into Saudi Arabia, Turkey, UAE, Lebanon, and others are making the region a significant net growth area).Seemingly, Sub-Saharan Africa's geographical remoteness coupled with the changing global demand for highly skilled labor and the great poverty of Africa's citizens is a barrier that is keeping Africans in Africa. All this is essentially saying that, practically speaking, the end of population growth as the primary feature of economic growth is coming to an end sooner than advertised. As the chart below highlights, excluding Africa, there will be far less growth than previous and what growth there is will be primarily among the elderly.