What Is Demographic Dividend?

With the birth of the baby boom, the population has entered the middle age.

Demographic dividend, in simple terms, is the relatively large number of school-age labor force in the population, which contributes to economic growth.

This is because the age structure of the population determines the pattern of consumption, saving and investment, affecting the prices of goods and assets, and thus changing the economic structure of a country.

The rapid decline of the fertility rate of a country has accelerated the aging of the population. Meanwhile, the child dependency ratio has also declined rapidly. The proportion of the working age population has increased. Before the proportion of the elderly population reaches a higher level, it will form a "golden era" with relatively abundant labor resources, low burden of support and favorable economic development. The population economist calls it "demographic dividend".

The present age structure of population in China is at the stage of demographic dividend. The total labor force supply is about 10 million per year, and the proportion of labor force is relatively high, which ensures the labor demand in economic growth.

Because the peak of population aging has not yet arrived, the burden of social security expenditure is light, and wealth accumulation speed is relatively fast.