Demographics play an important role in the economic growth. Any demographic change can affect GDP, living standards, infrastructure investments, social welfare, etc.

 

Population Growth

It is commonly understood that the higher the population growth, the better the economy will be.

Some countries experiencing low birth rate are introducing more family-friendly schemes [to boost birth rates] and accepting more skilled immigrants.

 

Age Structure

There is no ideal age structure for the economy.

However, usually an economy wants to avoid an aging population, since it will lead to declining labor forces and will stretch the social & healthcare services.

Age structure needs to be sensible, considering the life expectancy, pension schemes, replacement ratio, etc.

Currently, the country’s population has youthful age structure, with almost 70% of population at productive age range (15-64).

 

Education

Higher academic qualifications (i.e. university degrees) among young generations are generally good for the economy, up to a certain point.

There might be not enough white-collar jobs available for the young generations, especially those without any experience.

Hence, the tertiary education needs to be modelled appropriately, such that the youths are ready to work with the right skillsets, leaving no gaps unfilled.

Often, non-university educations (i.e. academies, polytechnics, institutes, and schools of higher learning) are overlooked although the learned skills could be more practical and not as hard to find jobs around.

 

Healthcare

Decent healthcare system will improve life expectancy and life quality.

Currently, majority of population is covered by government’s BPJS and other health schemes.

Although some argue that this will stretch the national budget, others could argue that the economic benefits will eventually outweigh the costs.

 

Disclaimer: NOT FINANCIAL / INVESTMENT ADVICE. This article is of writer’s personal opinion. Any information contained here is for education and informational purpose only. Readers should seek other sources or professional advice for further clarification where deemed necessary.