A Look at the Future of Population Collapse -- Italy and South Korea
A relative recently toured central Italy with a tour group. Hearing her talk about how empty it was, about 80% vacant homes, and how the housing was falling apart due to lack of upkeep, sparked my interest in the economics and social implications of declining populations.
A similar trend is under way in the USA. It primarily affects smaller towns in farming regions and among their primary struggles is how to maintain access to healthcare. Iowa State University has produced analyses of what separates towns that remain viable as they shrink from towns that become dysfunctional. They quantified quality of life so they could measure differences in a meaningful and consistent way. It is a fascinating read in part because unlike the CW that says towns must grow to thrive, their premise accepts that many towns will not grow and that frees the researchers to look at best practices. Their PDF is here:
https://isuaamncus122stg.blob.core.windows.net/shop/SOC3083.pdf
Looking at Italy, many of the changes seen there are simply more extreme versions of what is happening all over the USA. The BBC looked at the town of Fregona in Veneto and reports that, like in the USA, schools are closing steadily starting with grade schools and rolling into middle and high schools as the nonexistent children age.
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On average, Italian women are now having just 1.18 babies, the lowest level ever recorded. That's under the EU average fertility rate of 1.38 and far below the 2.1 needed to sustain the population.
https://www.bbc.com/news/articles/c5y76483200o
Incentives have had no impact and younger couples report that the high cost of living is not the biggest influence on their family size choices -- lifestyle and career are.
Elsewhere, the world's fastest population collapse is underway in South Korea where the birth rate is at 0.73 and still falling. Some stats say it is 0.68 which points to another odd wrinkle -- the scale of population collapse is treated as a military secret. 0.68 means that for every 10,000 South Koreans in Gen Z there will be less than 3,400 in the generation they raise. Studies of South Korea show that despite relative wealth the nation's attitude toward women is a factor in the declines. Because women are paid less than men there is even more pressure on them to work longer hours. Other research outlines a kind of turbo effect where households which welcomed the advantages of two incomes 20 years ago, increased their spending and now need two incomes to maintain their lifestyle:
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The Covid-19 pandemic led to postponed marriages and childbirths, temporarily pushing fertility below its trend. The recent uptick in marriages and births reflects a catch-up effect from the pandemic years but may also signal the start of a reversal in trend, driven by the working-hour reduction reform phased in between 2018 and 2021 and the strengthening of family policies over the past couple of decades. However, a fertility revival will at best be slow until policies, gender norms and working practices taken together support a large majority of women to pursue career and family in tandem.
https://cepr.org/voxeu/columns/what-we-can-learn-koreas-demographic-meltdown
How AI, robotics and the collapse of the job market plays into this remains to be seen. If AI and robotics continue to replace human workers and soldiers, it seems likely that governments and oligarchs will shift from incentivizing fertility to accepting and managing the population decline and demographics will invert from children outnumbering seniors to seniors outnumbering everyone else.
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