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Economics

What will global population decline mean for cities? 

Hint: It isn't all bad.

Thomas Malthus, in the future. (Technical.ly/Chris Wink/made with DALL-E)

This piece first appeared in Technical.ly CEO Chris Wink’s Builders newsletter. It features tips on growing powerful teams and dynamic workplaces. Sign up to get more pieces like this in your inbox before they appear on our site.

In 1798, 32-year-old English cleric Thomas Malthus described a common phenomenon: The population of a successful nation would increase until food systems couldn’t keep up.

Time-saving innovation was used to make more new people, rather than improving quality of life for existing people. War or famine would inevitably follow, he wrote. Malthus correctly described much of recorded history. Ironically though, just as he was writing, the first few rich nations were escaping this “Malthusian trap” with the rapid improvement in food production efficiency. For the next two centuries, successive waves of countries beat the trap, and saw their populations soar.

In 1800, about a billion people lived in the world, growing meagerly, if consistently, by about 0.04% for the previous 10,000 years. Today, more than 8 billion people are alive, surging at a peak of 2.2% per year in the 1960s. It was an earth-shaking two-century-long period. Now it’s all over, as documented in the 2019 book by demographer Paul Morland called “The Human Tide: How Population Shaped the Modern World.”

The world population is now growing by less than a percent a year and falling. The United Nations projects the global population could peak at about 10.4 billion in the 2080s and begin declining by 2100. What does this mean for economic strategy, and for cities in particular?

“Population decline is happening. And at the same time, also our population is aging,” said author and urbanist Diana Lind, who writes a newsletter called “A New Urban Order.” “So it’s going to be a really big change. And I think that we’re pretty unprepared for it.”

Understanding the inevitable decline

This is no ineffectual thought exercise. Demography shapes hiring patterns, entrepreneurship trends and how our communities operate.

This matters specifically for tech economies because younger, growing populations tend to start more companies and invent more breakthroughs. Innovation leaders will be tested. Making this trickier still, population declines won’t happen uniformly.

China’s population is already declining, timed with economic turmoil. Europe’s population is expected to begin shrinking in the next few years. In contrast, the population across the African continent is still projected to surge for decades — considered an answer to the global tech talent shortfall.

Four big factors inform population trends: births, deaths, migration — and who is counting.

US population trends are more unusual both because fertility rates have fallen less slowly than other rich countries and because we remain the global leader in attracting immigrants, who are major economic contributors.

Even within the United States, population patterns are unevenly distributed. In South Dakota, nearly 70 women aged 15 to 44 per 1,000 gave birth in 2021, a figure that was below 45 for Vermont, according to the CDC. Americans have been moving to the South and Southwest for decades — practically ever since we invented air conditioning. More than 10 million immigrants live in California, but fewer than 23,000 in Montana. Put it all together, and population trends look different across US states, counties and cities.

The population of Austin has grown by more than 20% each decade since the 1920s. The populations of Atlanta, Denver and Washington DC all grew between 2010 and 2020 by double-digit percentages. Philadelphians cheered modest growth of 5% in the same period. In contrast, the populations of Baltimore and Pittsburgh have been shrinking since the 1950s.

As global population decline plays out over the coming decades, many so-called superstar cities are expected to continue to grow — if housing and infrastructure keep up. But everyone, everywhere will likely face the same phenomenon: After hundreds of years of unprecedented growth, the human population will eventually shrink.

Reframing growth and success

Shrinking populations worry some for two main reasons: Our clearest metric for the health of a community is if more people want to live there and most modern institutions, from tax bases and infrastructure, were built in a time when each successive generation was bigger than the previous one.

Both have to change. Lind says cities need to rethink what growth and success mean in an era of population decline.

“Paris is a good example,” she said of the City of Lights’s population decline since 2012. “The metric of success is not necessarily the number of people who are living there, but what the quality of life is like in the city.”

Here a critical point for city leaders is to understand why a population declines. Barring some radical change, fertility rates are expected to continue to decline. Immigration, too, likely won’t increase forever. The question becomes: Is your city’s population declining because of these secular trends, or because quality of life is worsening for all?

What should city leaders do about population declines?

Big demographic shifts are no excuse for shirking responsibility on building better, more livable cities. A mindset shift is necessary.

“Stop thinking about necessarily having unrealistic expectations about growing your population,” Lind said. “Instead, think … how could [population loss] possibly be an asset?”

For example, vacant properties have been repurposed as green space and community-run gardens. Infill development to increase housing supply and reduce what local governments have to maintain.

Mindset changes come slowly, though.

“I wouldn’t expect a mayor to get on the podium and talk about population decline,” Lind said. “It’s something that they’re thinking about as an administration, not necessarily as a policy platform.”

Instead, how mayors talk about developing, housing and trends can change.

“I would vote for how to make your city as attractive as possible to immigrants, because that’s where the population growth is,” Lind said.

Different cities may have different expectations of growth for now. Two hundred years ago, we changed our understanding of what population growth meant. We’ll need to do it again.

“Cities across the country,” Lind added, “really need to start facing up to the fact that population decline or stasis is really going to be the norm.”

Series: Builders
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