Many nations, especially those with advanced economies, face significant demographic challenges. Due primarily to declining fertility rates, the populations of these countries are stagnating and, in some cases, even shrinking. In addition, most developed countries are “graying,” with seniors accounting for an increasingly larger share of their overall populations.
In the coming decades, these demographic trends will only accelerate, straining the already-tested economic and social systems of the developed world. As increasing numbers of elderly people exit the workforce, slower population growth leaves fewer young workers to take the jobs they vacate. This makes it difficult to maintain the size of the labor force, which in turn limits the economy’s growth potential and strains social insurance programs that count on workers to support retirees.
The United States faces these same challenges, but thanks to immigration trends, has a healthier demographic outlook than most other advanced economies. Immigrants help improve the U.S. demographic outlook by (1) coming in large numbers (about one million legally per year) and (2) having children at nearly a 50 percent higher rate than people who are not immigrants.
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