Demographic trends in Ukraine and its influence on the economy within the next 5 years

Ukraine on the world demographic map. Examination of the average wage in the country. Analysis of the dynamics of population. The impact of the demographic situation in the economy. Creating opportunities for business growth and economic activity.

Рубрика Экономика и экономическая теория
Вид реферат
Язык английский
Дата добавления 21.01.2015
Размер файла 126,5 K

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Demographic trends in Ukraine and its influence on the economy within the next 5 years

Demchenko Oleksandra

Marketing Class

Ms.Koessler- Collins

Table of Contents

Introduction

1. Ukraine on the world demographic map

2. The Impact on the economy

Works Cited

Introduction

Demographic trends reveal developments and changes in human population. Business leaders, marketers, and advertisers can have valuable understanding from demographic trends. Evaluating demographic trends for the area might reveal that there's a change in the population's average age, employment status, income, or wealth -- all of which would help businesses better target its customers and prospects.

1. Ukraine on the world demographic map

Average income

Average monthly salary in Ukraine equals to §250-300 USD

Ethnic groups

Ukrainian 77.8%, Russian 17.3%, Belarusian 0.6%, Moldovan 0.5%, Crimean Tatar 0.5%, Bulgarian 0.4%, Hungarian 0.3%, Romanian 0.3%, Polish 0.3%, Jewish 0.2%, other 1.8% (2001 census)

Decrease of population

Nowadays, in most developed countries there are stable trends to decrease of population size. Ukraine is one of these countries. As of December 2011 45.6 million people lived in Ukraine. In 1991 it was 52 million people. Thus during years of independence the population of Ukraine decreased by 6.4 million people. (research&branding group).

demographic population economy business

Figure 1. Dynamics of population size of Ukraine

Decrease of birth rate

Ukraine's fertility rate had been falling throughout the 1990s, reaching an all-time low of 1.1 children born per female by 1999. Although improving economy saw the fertility rate climb back to 1.4 by 2011, this is still significantly below the replacement level of 2.2.

Death rate

The death rates in Ukraine are very high. Mortality in Ukraine amounts to 15.2 whereas in countries of the EU, the number is 6.7 to every 1,000 of the population.

The mortality rate of men of working age in Ukraine is higher even than those countries whose gross national product (GNP) is 4-6 times lower than that of our country.

The State Statistics Committee of Ukraine estimates that Ukraine now has a deficit of almost 3.6 million men - with the average life expectancy for men now 62 years, a dozen years less than the corresponding figure for women.

Ageing of the population

The tendence of the population aging is present in Ukraine. The share of population aged 60+ in Ukraine has increased 2.2 times over the past 50 years. It is going to increase by 67% over the next 45 years, reaching the level of 35% of the total population.

On the other hand, during the next 50 years, the size of the working age population (aged 20-59) will shrink by 41%. (Lisenkova, 2009)

Figure 2

Emigration

In the period of 1994-2001, the quantity of people leaving the country for permanent residency abroad exceeded the quantity of people moving to Ukraine for permanant residency by 100-150 thousands of people.

For the time being this tendence has been dissipated and for the years of 2006-2011 a minute positive migration gain of the population of Ukraine was 14-17 thousands of people per year.

Figure 3 NATURAL GAIN. MIGRATION GAIN (violet line- natural gain, yellow line - migration gain)

2. The Impact on the economy

Due to the ageing of population, lack of men there will be more and more shortage of labour age population in Ukraine. Although labour shortages will increase wages and thus benefit consumers, lower competitiveness and output will negatively impact the country's long-term economic growth.

Within next 5 years the demographic situation will continue influencing economic of Ukraine: large part of GDP will be given to pensions, health care system, learning and retraining of personnel. This is already prompting policy changes in areas like retirement ages and the funding of long term care.

In an effort to relieve pressures on government expenditure, in July 2011 the Ukrainian government raised the female retirement age from 55 to 60 and the male retirement age of from 60 to 62.

On the other hand, there can be a positive impact of an ageing population, as it can create opportunities for business growth and economic activity. These include new growth sectors such as those servicing the very old, and a market for personal services. Consumers have already benefited from wages rising sharply as a result of labour shortages

· Monthly wages grew by an average 13.1% year-on-year in real terms between 2001 and 2011 (data for 2011 refers to the first three quarters) according to national statistics. Real annual disposable income per capita grew by 208.6% in the same period;

· However, higher wages have made Ukraine less competitive, so unless it moves toward higher value added activities, economic growth will slow down. (Euromonitor International, 2012)

Works Cited

1. (n.d.). Retrieved from research&branding group: http://rb.com.ua/eng/marketing/tendency/8229/

2. Euromonitor International. (2012, May). Retrieved from http://blog.euromonitor.com/2012/05/ukraines-population-in-rapid-decline.html

3. Lisenkova, K. (2009). The impact of population ageing on the economic development of Ukraine. Heriot-Watt University.

4. Research&branding group. (n.d.). Retrieved from demographic trends in Ukraine: http://rb.com.ua/eng/company/news/8230/

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