Local demographic change
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Demographics refers to the number of people and the mix of ages, genders, backgrounds and locations in a population
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Local populations grow, shrink or change their composition when push factors drive people away or pull factors attract them
Examples of push and pull factors
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Jobs and income opportunities
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New factories, technology hubs or tourist resorts attract workers
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Factory closures or farm decline push them out
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Housing supply and cost
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Towns offering affordable, good-quality homes for families or retirees can grow quickly
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High prices or poor housing can cause population decline
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Transport links and digital connectivity
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A new motorway junction, rail station or high-speed broadband makes commuting or remote work easier, encouraging inward migration
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Education and training
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Universities, colleges or specialist schools attract students and staff
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Parents may move to a different area to access better state schools
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Quality of life
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Clean air, green space, low crime, cultural venues and leisure facilities act as strong pull factors
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Environmental hazards or congestion do the opposite
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Government and planning policy
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Enterprise zones, tax incentives and urban regeneration grants can revive an area, whereas planning restrictions can limit growth
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Birth and death rates
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Districts with many young families may see natural increase, while areas with older populations may shrink over time
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Case Study
Rapid population growth in Austin, Texas
Austin’s population has surged from about 1 million in 2000 to well over 2 million today, making it one of the fastest-growing large cities in the United States.
Reasons
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Technology and creative industry expansion
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Major firms such as Dell, Apple, Tesla and Oracle have expanded, offering high-wage jobs
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Quality of life pull factors
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A strong music scene, mild climate and relatively low taxes attract graduates and remote workers
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University talent pipeline
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The University of Texas supplies engineers, technology graduates and researchers that supply high-quality staff
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Impacts on businesses
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Large labour pool and innovation
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Employers gain access to skilled workers and a vibrant start-up community, encouraging investment and collaboration
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Rising costs and competition for space
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High demand pushes up commercial rents, housing prices and wage expectations, so firms must budget carefully or consider satellite offices in nearby towns
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National demographic change
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The population structure of a country can change for a variety of reasons
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Birth rate
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Influenced by living costs, childcare availability, women’s education and career choices, access to family planning services and cultural views on family size
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Death rate
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Better healthcare, sanitation and nutrition lower mortality
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Epidemics, conflict or poor medical access raise it
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Economic booms and slumps
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Growth attracts workers and encourages larger families; recessions can delay parenthood and trigger emigration
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Government policies
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Tax incentives for larger families, limits on family size, visa rules, pension ages and healthcare funding all shape population trends
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Case Study
Latvia’s shrinking population
Latvia’s population has fallen by roughly one-quarter since 1990 and is still declining each year.
Reasons
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Low birth rate
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Average fertility is well below the replacement level of 2.1 children per woman
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Net emigration
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Many working-age Latvians have moved to other EU countries for higher wages
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Ageing
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Longer life expectancy means a growing share of residents are over 65
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Impacts on businesses
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Labour shortages and wage pressure
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Firms in construction, healthcare and IT struggle to fill vacancies
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This pushes up wages and encourages employers to invest in automation or recruit foreign workers
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Shrinking domestic market
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Fewer consumers at home reduce demand for mass market goods
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Companies focus on export sales or target the expanding silver economy with products and services for older customers
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International demographic change
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Global population growth is decelerating
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The United Nations projects a rise from about 8 billion today to roughly 9.5–10 billion by 2055, after which it is likely to level off
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A sharply ageing world
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Almost every region will see a higher share of people over 65 as fertility falls and life expectancy lengthens
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This will shrink the working-age population in many economies
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Regional shift towards Africa and South Asia
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More than half of all new births to 2055 are expected in just eight countries, led by Nigeria, India and Pakistan
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Populations in Europe, Japan and China either stagnate or decline, shifting the centre of labour supply and consumer demand southwards and eastwards
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Migration
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Migration is the movement of people from one place to another with the intention of living or working there for at least a significant period of time
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It can be internal (within the same country) or international (crossing borders) and may be temporary or permanent
Why Canada encourages international migration
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Main reason |
How it helps Canada |
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Filling skill shortages |
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Countering an ageing population |
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Sustaining economic growth |
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The impact of demographic change on business decisions
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As age profiles, family sizes and migration patterns shift, firms must rethink what they sell, where they open, and whom they hire
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Demographic change |
Opportunities for businesses |
Threats to businesses |
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Ageing population |
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Young population |
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Falling birth rate / shrinking market |
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Rapid urbanisation |
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Rising migration and cultural diversity |
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Smaller households and solo living |
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More women in paid work |
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