Business and Economic Update
Issue 01

One important factor for the Philippines’ rather fast economic growth in recent years is its “demographic dividend”. Big, young population, estimated at around 101 million people as of May 2015, and the 12th biggest in the world. Big population means big number of entrepreneurs and workers, producers and consumers.

The numbers below show some interesting revelations. First, of the top 10 largest countries in the world in population size, six of them are from Asia. And in the top 20 largest populations worldwide, four of them are from the ASEAN.

Second, while the Philippines and some of its neighbors in the region have a steadily rising population, other countries in the world are less lucky as their population is growing only marginally, or even flat lined after two decades. These countries are marked in red.

Table 2. Population in million.

Population in million.

Source: IMF, World Economic Outlook 2015 (WEO) Database

In various economic analysis by the world’s largest investment banks and ratings agencies, they usually cite the Philippines’ huge and young population as a major asset. It allows the country to have a huge pool of domestic workers and entrepreneurs, and professionals and managers that are well-sought abroad, especially by labor-deficient wealthy economies of North Asia, the Middle East, Europe and North America. The country is #1 worldwide in call center revenues and other business process outsourcing (BPO) services.

The huge number of Filipinos working abroad, 2.3 million based on National Statistics Office (NSO) data, not 10 million as often cited and popularly quoted, helps other countries to expand their respective economies. The 10 million figure includes non-workers, like overseas Filipino students and dependents of those employed abroad.

How young is the Philippine population compared to its neighbors? The numbers below make important revelations.

Table 3. Population Aged 0-14 and 15-64 years old, percent of population

Source: ADB, Key Indicators of Asia and the Pacific 2014

* Brunei is an “outlier” because it has a very small population, India is not part of SE Asia but included here for reference purpose.

The developed economies of North and East Asia have a generally ageing population. The fiscal pressure on public health and pension is very obvious in Japan and becoming more visible in Hong Kong, S. Korea, Taiwan and Singapore.

The Philippines on the other hand, has a huge labor “reserves” of children and early teenagers, comprising 34 percent or one third of the entire population. Only Laos and Cambodia have similar situation but as the Philippines they have smaller populations.

Soon,rich but aging people in North East Asia will be demanding more foreign health workers and professionals to take care of them. Filipino health professionals are well-sought in this field not only in East Asia but also in North America, Europe and the Middle East.

Copyright © 2017 Alas Oplas & Co., CPAs. All rights reserved.