World Bank scenarios 3 for SA – creating a better enabling environment to realise the demographic dividend
TRENDS
that is largely unemployable as a result , and those who have an education can ’ t find work .
World Bank scenarios Just how we can make the most of the demographic changes and our dividend isn ’ t a simple question to answer , but Dr Mostert quotes four interesting scenarios that could be the most likely responses , as posed by the World Bank , namely : Business as Usual , Job Creation , Productivity- Enhancing , and Accelerated Educational Attainment . Each of the scenarios has some intriguing characteristics , as highlighted in Table 1 .
The main findings of the four scenarios are as follows 2 : 1 . Business as Usual – we potentially have the ideal age ratio for a young workforce , but the labour market is unable to absorb new entrants .
2 . Job Creation – the labour market improves considerably and growth is far more job-intensive , but there are modest gains to growth and income from a growing working-age population .
3 . Productivity-Enhancing – a combination of job creation accompanied by gains in labour productivity , with the increase in productivity helping to offset some of the pressures on savings and growth from having a growing share of the population older than 65 .
4 . Accelerated Educational Attainment – lower unemployment rate and faster labour productivity growth is complemented by faster skills attainment by school graduates entering the working-age population . The impact of a growing working-age population on growth and incomes is further enhanced by efforts to improve educational attainment and skills .
TABLE 1
World Bank scenarios 3 for SA – creating a better enabling environment to realise the demographic dividend
Scenario 1 Business as Usual
• Unemployment persists at 25.1 %
• Real GDP growth averages at 3.7 % per annum , while real GDP per capita averages 3.1 %
• Savings as a share of GDP rise from 14.5 % ( 2015 ) to 18.5 % ( 2030 ).
Scenario 2 Job Creation
• Employment rate rises from 43 % to 54 % in the working-age population
• Unemployment decreases from 25.1 % ( 2014 ) to 5.8 % ( 2030 )
• The number of people employed grows almost three times faster than in the Business as Usual scenario .
1 . The World Bank : 2015 ( Online ) https :// data . worldbank . org / indicator / SP . DYN . TFRT . IN
2 . South African Futures : Social Capital , Has South Africa been successful in capitalising on its demographic dividend ? Vol 1 ( 10 ) May 2007