Dependency population
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Dependency population
Subject: Geography
Given its demographic profile, India is uniquely placed to provide services to ageing societies of the developed world.
Concept:
Dependency ratio
- It is the ratio of persons in the ages defined as dependent (under 15 years and over 64 years) to persons in the ages defined as economically productive (15-64 years) in a population.
- This demographic indicator gives insight into the number of people of non-working age, compared with the number of those of working age.
- Dependency Ratio is also sometimes called Total Dependency Ratio.
- It is made up of two different ratios viz. Youth Dependency Ratio and Age Dependency Ratio.
- The youth dependency ratio includes those only under 15, and the elderly dependency ratio focuses on those over 64.
- A high dependency ratio means those of working age, and the overall economy, face a greater burden in supporting the aging population.
- A dropping Total Fertility Rate reduces the dependency ratio, as there are fewer children below working age dependent on the working population.
- A lower dependency ratio should ideally result in higher economic growth, as there is a large section of people working, saving and investing.
- Improving living standards and medical advances over the past 40-50 years have prolonged life spans, thereby skewing the dependency ratio at the other end of the age spectrum.
Trends in dependency ratio:
- According to the UN, by 2050, 1 in 6 people in the world will be over 65, up from 1 in 11 in 2019.
- Dependency ratios in high-income countries– are steadily increasing – on an average at 55 per cent of the total population.
| Countries | Overall dependency ratio /(2021) |
| Japan | 70% (highest) |
| Germany | 56% |
| France | 63% |
| UK | 57% |
| US | 55% |
- To counter the challenge of rising dependency ratio- developed nations are focussing on artificial intelligence (AI), Industry 4.0, etc., which could reduce the required human interventions
- Higher dependency ratio in high income country-India’s opportunity
- Economic dividend– by providing working professionals and services export to developed countries.
- Japan -an agreement under the Specified Skilled Workers (SSW) programme to onboard trained nurses from India.
- Kerala – provide free European language training to tribal nursing professionals to help them migrate.
- India is the world’s largest recipient of remittances with receipts stood at $87 billion in 2021.
- Economic dividend– by providing working professionals and services export to developed countries.