Understanding The Effects Of Demographical Changes In Your Business Sector

Understanding The Effects Of Demographical Changes In Your Business Sector

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Understanding The Effects Of Demographical Changes In Your Business Sector
Understanding The Effects Of Demographical Changes In Your Business Sector
The world is definitely on a continuous change. One of the most significant changes has been done without people to even notice it – the demographical change. Understanding this change might provide a lot of business opportunities. It sounds hard to understand, but it is actually pretty simple.

The effects of demography over the business world

The general idea is pretty simple to understand. Once you understand the demography, you will reveal both business opportunities and risks. HSBC is one of the companies that can actually understand the importance of demography. It is often known as the global local bank. In the long run, it is crucial to understand the composition of various populations, the way they change and their expectations from the society. It is even more important to do your homework if you run a financial business. All in all, HSBC has come up with an interesting message in 2007.

“Tell us what you think. Do you agree with the 57% of all Indonesians who choose to rest once they retire? How about the 58% of all Canadians who assume that retirement is the perfect time for a new career? Since the natural life expectation has increased lately, this topic is definitely worth some attention, especially since by 2050, 22% of the world population will be retired.”

HSBC is responsible for a lot of dynamical solutions and businesses, whether it comes to life, pension and investment. This is only the beginning though. Demography is actually behind a lot of changes in HSBC. HSBC has easily responded to the emigration coming from Eastern Europe. Emigrants work in better rated countries in order to support their families, so they obviously need the possibility to send money back home. These are not just some sporadic changes, but an actual trend.

In my opinion, the twentieth century has brought in a series of demographical changes. The world population has increased from 1.6 billions in 1900 to 6.1 billions in 2000. This was the quickest growth in the human history. However, this growth has also brought in an obvious decrease in the mortality rate, as well as the fertility. All in all, it has led to the development of some huge economical centres too, which are more populous than many countries.

The highest growth has been noticed in India, China, Pakistan, Nigeria, Indonesia and Bangladesh. There are no doubts that demographical developments are practically changing the world around. But it is up to you to observe such changes.

  • Japan estimates to lose up to 50% of its population by 2100 due to the low natality and a very low level of emigration.
  • Within a decade, Italy will have around a million inhabitants over 90 years old.
  • The United States of America represent the only developed country with a growing population, mostly because of the emigration. By 2050, the country is expected to count more than 400 million inhabitants. Most of the emigration targets the developing areas though.
  • Demographical changes influence the family composition by giving the feminine influence more power.
  • Populations will be older than ever, while the repercussions will be obvious on social help politics, taxes, expenses or pensions.
  • The urbanization is the new trend. For the first time in the human history, the urban population has overcome the rural one. It happened in 2006.

Benefiting from the demographical changes

As a general rule of thumb, you need to understand how demography can affect the market segments that you are actually interested in. What are the tendencies? What about the opportunities? What about the risks? Who are your current customers? What about the future ones?

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