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The World Might Be Running Low on Americans

    The world has been stricken by scarcity. Our post-pandemic pantry has run bare of gasoline, lumber, microchips, chicken wings, ketchup packets, cat food, used cars and Chickfil-A sauce. Like the Great Toilet Paper Scare of 2020, though, many of these shortages are the consequence of near-term, Covid-related disruptions. Soon enough there will again be a chicken wing in every pot and more than enough condiments to go with it.

    But there is one recently announced potential shortage that should give Americans great reason for concern. It is a shortfall that the nation has rarely had to face, and nobody quite knows how things will work when we begin to run out.

    I speak, of course, of all of us: The world may be running low on Americans — most crucially, tomorrow’s working-age, childbearing, idea-generating, community-building young Americans. Late last month, the Census Bureau released the first results from its 2020 count, and the numbers confirmed what demographers have been warning of for years: The United States is undergoing “demographic stagnation,” transitioning from a relatively fast-growing country of young people to a slow-growing, older nation.

    Many Americans might consider slow growth a blessing. Your city could already be packed to the gills, the roads clogged with traffic and housing prices shooting through the roof. Why do we need more folks? And, anyway, aren’t we supposed to be conserving resources on a planet whose climate is changing? Yet demographic stagnation could bring its own high costs, among them a steady reduction in dynamism, productivity and a slowdown in national and individual prosperity, even a diminishment of global power.

    And there is no real reason we have to endure such a transition, not even an environmental one. Even if your own city is packed like tinned fish, the U.S. overall can accommodate millions more people. Most of the counties in the U.S. are losing working-age adults; if these declines persist, local economies will falter, tax bases will dry up, and local governments will struggle to maintain services. Growth is not just an option but a necessity — it’s not just that we can afford to have more people, it may be that we can’t afford not to.

    But how does a country get more people? There are two ways: Make them, and invite them in. Increasing the first is relatively difficult — birthrates are declining across the world, and while family-friendly policies may be beneficial for many reasons, they seem to do little to get people to have more babies. On the second method, though, the United States enjoys a significant advantage — people around the globe have long been clamoring to live here, notwithstanding our government’s recent hostility to foreigners. This fact presents a relatively simple policy solution to a vexing long-term issue: America needs more people, and the world has people to send us. All we have to do is let more of them in.

    For decades, the United States has enjoyed a significant economic advantage over other industrialized nations — our population was growing faster, which suggested a more youthful and more prosperous future. But in the last decade, American fertility has gone down. At the same time, there has been a slowdown in immigration.

    The Census Bureau’s latest numbers show that these trends are catching up with us. As of April 1, it reports that there were 331,449,281 residents in the United States, an increase of just 7.4 percent since 2010 — the second-smallest decade-long growth rate ever recorded, only slightly ahead of the 7.3 percent growth during the Depression-struck 1930s.

    The bureau projects that sometime next decade — that is, in the 2030s — Americans over 65 will outnumber Americans younger than 18 for the first time in our history. The nation will cross the 400-million population mark sometime in the late 2050s, but by then we’ll be quite long in the tooth — about half of Americans will be over 45, and one fifth will be older than 85.

    The idea that more people will lead to greater prosperity may sound counterintuitive — wouldn’t more people just consume more of our scarce resources? Human history generally refutes this simple intuition. Because more people usually make for more workers, more companies, and most fundamentally, more new ideas for pushing humanity forward, economic studies suggest that population growth is often an important catalyst of economic growth.

    A declining global population might be beneficial in some ways; fewer people would most likely mean less carbon emission, for example — though less than you might think, since leading climate models already assume slowing population growth over the coming century. And a declining population could be catastrophic in other ways. In a recent paper, Chad Jones, an economist at Stanford, argues that a global population decline could reduce the fundamental innovativeness of humankind. The theory is simple: Without enough people, the font of new ideas dries up, Jones argues; without new ideas, progress could be imperiled.

    There are more direct ways that slow growth can hurt us. As a country’s population grows heavy with retiring older people and light with working younger people, you get a problem of too many eaters and too few cooks. Programs for seniors like Social Security and Medicare may suffer as they become dependent on ever-fewer working taxpayers for funding. Another problem is the lack of people to do all the work. For instance, experts predict a major shortage of health care workers, especially home care workers, who will be needed to help the aging nation.

    In a recent report, Ali Noorani, the chief executive of the National Immigration Forum, an immigration-advocacy group, and a co-author, Danilo Zak, say that increasing legal immigration by slightly more than a third each year would keep America’s ratio of working young people to retired old people stable over the next four decades. 

    As an immigrant myself, I have to confess I find much of the demographic argument in favor of greater immigration quite a bit too anodyne. Immigrants bring a lot more to the United States than simply working-age bodies for toiling in pursuit of greater economic growth. I also believe that the United States’ founding idea of universal equality will never be fully realized until we recognize that people outside our borders are as worthy of our ideals as those here through an accident of birth.

Opportunity Cost

This phenomenon goes by the name of ‘opportunity cost,’ since by not investing in more equipment and a more rigid production flow, the company is forgoing the opportunity to earn increased profits. These costs are every bite as real as the payment of dollars out-of-pocket.

This notion _______ opportunity cost can be reinforced _________ a famous saying ______ Benjamin Franklin, no slouch himself _________ operations management. To make the point, however, we must make a brief excursion into logic. One truth of logic is the validity of the so-called contrapositive, which says simply that if the statement “If A, then B” is true, then it is also true that “If not B, then not A.” That is, of every time A occurs B follows, then we can be sure that if B does not occur, then A did not occur as well. Enough logic then, and back to Ben Franklin.

One of his Poor Richard sayings is that “A penny saved is a penny earned.” We have all recognized the truth of that since childhood, but I assert that by this saying Ben showed us he knows everything about opportunity cost. After all, what is the contrapositive of “A penny not earned is a penny not saved (i.e., a penny sent). All we are saying by this notion of opportunity cost is that “a penny not earned (an opportunity forgone) is a penny spent.” We shall often have occasion to consider opportunity costs, in analyzing and deciding various operations issues.

SCHMENNER, Roger W. Production/Operations Management. 5th Edition. Prentice-Hall, 1993.