Here’s what you’ll learn when you read this story:

• The global population drop is in motion.
• An economist believes the diminishing birth rate will have a detrimental impact on labor supply.
• The reason for our impending global population shortage is attributed to falling birth rates because of increased living standards.

The global population decline is in motion. And that could hamper the world’s entire economic model, leading to a dramatic crippling of our global economy, says Sebastian Dettmers, CEO of StepStone and the author of a book on the future of the world's population.

In an opinion piece published by Business Insider in 2023, Dettmers says, “the great people shortage is coming—and it’s going to cause global economic chaos.”

Well, that’s not great.

Dettmers says the “forces leading to a population drop are already in motion,” and he expects a decline in population in the next four decades. And don’t blame war, virus, or natural disaster—credit our illustrious living standards and shrinking birth rates.

“People are healthier, richer, better educated, living longer, and having fewer children,” Dettmers says. “But this decrease in humanity is not a reason to cheer, but rather a looming disaster for our economy. The great labor shortage caused by the declining population will cripple our global economy unless we find innovative ways to keep things running.”

While a declining population may offer encouraging signs for those concerned about overcrowding draining the world's resources, Dettmers says that the dropping birth rate—with the sharpest declines coming in the richest societies—means that there won’t be enough young workers to support that increased living standard.

He conservatively expects the global population to decrease by one billion people from its peak by the end of this century based on research from the Gates Foundation, and adds that working populations in Italy, Spain, and Greece will drop by more than half while Poland, Portugal, Romania, Japan, and China will all lose up to two-thirds of their labor force.

“The looming population decline is a wake-up call,” Dettmers says. “The most important fuel of economic growth in the past several centuries has been people. And with fewer people, less work can get done.”

We’ve already seen a declining workforce decrease efficiency, whether it’s in teachers and engineers or nurses and service workers. It all adds up to a downward-trending slope of less production and performance, less money spent, shrinking businesses, lower profits, and declining economic growth.

“To combat the coming population bust, the world will need nothing less than a revolution of our minds,” Dettmers says. “We need innovation and new ideas: robots and artificial intelligence that do our work for us and let everyone get the chance for good education and training.”