Population in Decline: Call for a resource change

A major resource change that has been in progress for many years now is population decline. In the year 2000, the population growth amounted only to a 1.5% annual growth rate. By 2015, the estimated growth rate is expected to be negative, at - 0.5%. If the trend continues, South Africa may face an enormous decrease in population, causing an economic devastation. In fact, GDP growth predictions have shown a possible 5.7% decrease. How so?

Population decrease means changes in the workforce. Whereas the workforce should be stealthily growing, it is in fact on the verge of collapse. The average final household consumption expenditure (FCE) is expected to decrease by about 0.3% per year for the next 13 years, due to more rapid growths in the economy’s product inflation and higher interest rates (all impacts of the millions of lives to be lost to AIDS over the next decade).

If the workforce is to be weakened it will mean a significant decrease in South Africa’s ability to work in agriculture and manufacturing. An overall decrease of 21% in the labor force is expected to take effect by 2015. This means that of the approximate 14 million citizens currently employed only about 11.06 million will be in the labor force within the next 13 years.

The PPC graph below indicate an approximation of the current agriculture/manufacturing curve and the one in the year 2015, based on the approximations made by economists, as described in South Africa’s newspaper Business Day.