Education has a large momentum, and whenever a country does not invest suffi ciently in education, this lack of investment will show for a life time. Let us imagine a coun- try where in 2011, the government fails to enroll in public schools 30 percent of all six-year-old children. If this cohort of six-year-olds does not manage to enroll in school in the following years, it will stay uneducated and 30 to 50 years later the labor force will still be plagued by this cohort of uneducated men and women. Th e diff erence between this example and the real world is that usually governments do not “forget” to ensure that all children enroll in primary education and the subsequent levels just for one year but for decades. Th is means that the size of cohorts suff ering from a lack of education can be very large and dominate the labor force, with no hope of being curtailed except with costly adult educational programs such as adult literacy campaigns that can be suc- cessful but are cumbersome and cannot be exhaustive in terms of population covered.
Multistate population projections by levels of educational attainment are very useful to see the momentum of education diff usion. In this section, we show results of the pro- jections for most Pacifi c Rim countries conducted by K.C. et al. (2010) according to a Global Education Trend scenario, that “assumes that a country’s educational expansion will converge on an expansion trajectory based on the historical global trend” (K.C. et al.
2010, p. 407).
Past neglects in education, showing large segments of the population with no educa- tion—above 10 percent—are especially visible in three Pacifi c Rim countries: Guatemala, Honduras, and Cambodia, where more than 10 percent of the working-age population have never been to school in 2010. Projected shares of the population with no education in those countries will remain above the 10 percent threshold until 2025-2035, even by implementing a scenario of strong convergence to high levels of education. Th e bottle- neck is oft en at the level of intake to primary school, meaning that for those who have managed to enter school, the way to the upper levels of the education system are easier;
this can be seen by the substantive percentage of the population with a secondary educa- tion or even a tertiary education ( Table 6. 3 ).
Patterns of education diff usion can be observed in the context of global demographic change. Figures 6.6 to 6.8 show three main patterns of demographic bonuses in the Pacifi c Rim region. In most central and Latin American countries ( Figure 6.6 ), the fertility tran- sition occurred somewhat late and rather slowly, so that the dependency ratios were still quite high in the last decades. In these countries, a group that also includes Malaysia, Philippines, and Cambodia, the dependency ratios that have steadily declined since the 1990s will reach their lowest level in the 2040s. Th e next group of countries shown in Figure 6.7 are countries where dependency ratios have already reached their lowest level (or will shortly like in Indonesia and Costa Rica) and will start increasing due to aging of the population, but the pace of the increase will be quite slow so that by 2070, the total
Table 6.3 Share of the 2050 Population by Levels of Education, Global Education Trend scenario (GET)
Change in dependency ratios Countries
No education
Primary education
Secondary education
Tertiary education
Countries with rapid increase in dependency ratios
China 0.2 6.9 75.1 17.9
Hong Kong 0 10.5 51.7 37.8
Japan 0 0 34.9 65.1
Macao 0 13.9 56.1 30
Russia 0 0.5 55.6 43.9
Singapore 0.1 6 35.4 58.5
South Korea 0 0 38.9 61.1
Countries with slow increase in dependency ratios
Australia 0 0 56.4 43.6
Canada 0 3.5 46.2 50.4
Chile 0.1 6.2 41.2 52.5
Costa Rica 0.4 19.9 43.2 36.5
Indonesia 0.1 15.1 62.1 22.6
New Zealand 0 0 56.9 43.1
Thailand 0.5 17.8 42.6 39.1
United States 0 5.2 52.9 41.9
Viet Nam 1.4 33 50.7 14.9
Late transition countries Cambodia 4.9 34 55.4 5.6
Colombia 0.2 10.5 52.8 36.5
Ecuador 0.5 17.3 41.8 40.4
El Salvador 1.1 12.8 53.8 32.4
Guatemala 5 27.8 48.7 18.5
Honduras 3.6 36.6 42 17.8
Malaysia 0.4 4.4 57.9 37.3
Mexico 0.5 15.7 52.8 30.9
Nicaragua 0 18.8 49.6 31.6
Panama 0.6 11.5 47.3 40.6
Peru 0.1 8.5 61.2 30.1
Philippines 0.2 8.2 43.4 48.2
Source : Based on K.C. et al. 2010.
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dependency ratio will still be below 100—meaning that for each active person, there is less than one (young and old) unproductive person. Th is group includes most of the Pacifi c OECD countries. In the last group shown on Figure 6.8 , the countries including China and the Russian Federation also reach their lowest level of dependency ratio in 2010–2015, however those will increase rapidly thereaft er so that by mid-century, those countries will have to deal with higher dependency ratios than the countries shown in Figure 6.7 .
0 20 40 60 80 100 120 140 160 180
1950 1960
1970 1980
1990 2000
2010 2020
2030 2040
2050 2060
2070
Total dependency ratio
Colombia Malaysia Panama Mexico Peru Ecuador Cambodia Philippines Nicaragua El Salvador Honduras Guatemala Year
FIGURE 6.6 Total dependency ratios (ratio of population 0–19 and 65+ per 100 population), 1950–2070, Late transition countries
Source : United Nations (2011).
0 20 40 60 80 100 120 140 160 180
Total dependency ratio
Year
Thailand Canada Australia Viet Nam Chile USA Costa Rica New Zealand Indonesia 1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050 2060 2070
FIGURE 6.7 Total dependency ratios (ratio of population 0–19 and 65+ per 100 population), 1950–2070, countries with slow increase in dependency ratios
Source: United Nations (2011).
Countries experiencing an increase in the working-age population implied by the low dependency ratios will need one main demographic factor 7 to transform the bonus into a demographic and economic window of opportunity, that is an increase in the levels of educational attainment of the working-age population: this will also be a means to increase the female labor force participation by reducing gender gaps in education. Projections of educational attainment show that the gains in education of the working-age population will be quite substantial in those countries if they follow the global trend scenario. In 2050, the proportion of the population with no educa- tion would be reduced to zero in most countries. Only in Cambodia, Guatemala, and Honduras would the share of uneducated people somehow still be visible. In those three countries, this would still be linked to a large share, close to one-third of the working population with a primary education or less (this is also the case in Vietnam). However, even in those countries with pockets of low education, there will still be a large popula- tion with at least a lower secondary education.
Table 6. 3 shows a quite uniformed distribution of the Pacifi c Rim countries’ popula- tion according to lower secondary education or more. It is at the level of tertiary educa- tion that most diff erentials are found among the countries where the scenario has been implemented. Th e countries that will be experiencing rapid aging in the near future can rely on a very highly educated working-age population, e.g., around 60 percent in Singapore and South Korea, which would in principle have a positive impact on the country’s level of innovation (see, for example, Dakhli and De Clercq 2004). Th e excep- tion in this group is China, where the proportion with a university degree would still be below 20 percent in 2050. However the projection for China is based on the educa- tional distribution in the 1990s, and the country has since then taken great strides in
0 20 40 60 80 100 120 140 160 180
Total dependency ratio
Year
Macao Hong Kong Russia Singapore South Korea China Japan
1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050 2060 2070
FIGURE 6.8 Total dependency ratios (ratio of population 0–19 and 65+ per 100 population), countries with rapid increase in dependency ratios
Source: United Nations (2011).
HUMAN CAPITAL TRENDS 161
increasing participation in upper education levels of education. Th e next group of coun- tries where the demographic bonus will last another few years is heterogeneous, with the Pacifi c OECD countries having a substantial share of the working-age population with a tertiary education, while the share will be much lower in Vietnam and Indonesia.
Th e countries that will be experiencing long periods of declining dependency ratios in the last group, while pursuing an increase in the proportion of people acquiring a higher education, could benefi t economically from a demographic bonus. Th ese are especially located in Latin and Central America, in countries such as Colombia, Panama, Ecuador, and also the Philippines fall into this group. Th e progress in other countries as observed now would be too slow to reach suffi cient levels of tertiary education to boost economic growth, like in Honduras, Guatemala, and Cambodia. It is worth noting that in all coun- tries there will be more women with a tertiary education compared to men. Th is is par- ticularly evident in Th ailand, Panama, Philippines, Russia, and Australia, where the share of women in the labor force with a tertiary education would be at least 10 percent- age points higher than that of men.