Technological Changes, the Reversal of Age Pyramids and the Future of Retirement Systems

Figure 6: Population Pyramid Summary for India 2000-2050
Source: U.S. Census Bureau, International database.

At the same time, the declining mortality rates quickly lead to a situation where most people who survived the first years continue to live for many years. Therefore, at any future point in time the bars describing young age groups move upward (as the group gets older), but the length of the bar remains fairly constant. This makes the pyramid less and less pointed, and after a few decades, when birth rates are significantly lower, the lower part of the pyramid becomes rectangular, or pillar shaped.
Later on, when birth rates reach a low level, the shape of the pyramid resembles a diamond (‘flower pot’) shape. The projected pyramids for Brazil, during the first half of the century serve as very good examples. Similar patters are observed and forecast for Egypt, Turkey and even Iran, but they are not shown here.

Figure 7: Population Pyramid Summary for Brazil 2000-2050
Source: U.S. Census Bureau, International database.

This trend continues in the post-industrial stage, the substantial drop in birth rates also being connected with the changing nature of the family structure: an increasing number of unmarried people, of families without children, a significantly older age for getting married, career considerations (of women mainly) that determine the size of the family, etc. The drastic decrease of births creates a strange situation. In the post-industrial era the diamond shaped age diagram gradually transforms into a fully reversed age pyramid. Japan could serve as an excellent example of this point. Similar patterns can be seen in the West European countries, though none of them will continue to be listed among the top large countries. The pyramids of Germany serve as good examples of countries in which older people (above 60) are typically more than one fifth, and sometimes even a quarter, of the entire population. France, Italy and the UK populations follow similar patterns, but are not presented here.

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