Growth in a shrinking world
For most of modern economic history, growth has meant more people. More workers. More consumers. More households entering the market. We actually don’t know how to make economic growth happen without population growth.
But we going to have to learn.
Global birth rates are falling. In countries across Asia, Europe, and even the Americas, population growth is slowing—or reversing. The UN now forecasts that the global population could peak in our children’s lifetime and begin to decline. For context see Pew Trust, NIH, and CDC notes.
Our current economic models are poorly equipped for this scenario.
We’ve built our financial systems, market forecasts, and innovation engines around expanding populations. We never ask: What does growth look like when the customer base is not getting bigger? It doesn't compute.
We always had these underlying foundational beliefs – that the population would get bigger, more people would need more things. This has always been the fundamental belief that persuades us to invest in stocks and startups. You've probably never seen a pitch deck or investment offer that said, "There'll be fewer people, and that's the reason our company will grow big time."
In fact, we may have almost no historical precedent for driving sustained economic expansion while the total addressable consumer population is shrinking.
But we're going to have to start figuring this out. We need a new strategy for a new kind of growth.
All sorts of ideas are coming up. Some suggest that