Africa's great demographic challenge

The population is young and growing, but for this to work in the continent's favour, jobs must grow too

- Natale Labia

When does a demographic dividend turn into a curse? Africa might be about to find out. Recent UN data shows that Africa is in the throes of the greatest demographic transformation of the 21st century. How it manages the transition from a young population with low life expectancy to the world's fastest-growing labour force will in no small part shape the global economy for decades.

The numbers are staggering. Africa's population has doubled in 30 years, reaching about 1.5 billion people. By 2100 it may swell to four billion — or nearly 40% of humanity. This surge will be driven by plunging infant mortality, better access to healthcare and high fertility rates.

About 60% of sub-Saharan Africans are under 25, compared with less than a third of Americans. In demographic terms, what the continent is about to experience is nothing short of an earthquake.

What matters most for economic growth is the ratio of workers to dependants. At present, sub-Saharan Africa's stands at about 1.3:1. As this rises, with more workers to support every child or retiree, the continent could enjoy the fabled “demographic dividend” — a boost to growth that derives from greater numbers of productive and economically active people entering the labour force.

Whether that promise can be delivered depends on two things. First, fertility needs to fall so that ever-growing cohorts of infants do not overwhelm the gains from rising life expectancy. Second, and more critically, the economy needs to generate enough jobs to absorb the millions of new entrants into the labour force so that unemployment rates do not skyrocket.