Although the world population continues to grow, the pace has slowed in most developed countries. That’s raised concerns for economists, demographers and other social scientists.

Some studies seek to determine if a population plateau is coming, followed by population aging and collapse.
A population plateau occurs when the population remains constant without growth and the fertility rate matches or falls below the mortality rate.

Why should that be something to which we should pay attention?
A population plateau followed by a decline would present challenges for small businesses and local economies. In Mesa County, we should be ready and plan for infrastructure that combats the outcomes of a population decline over the next decade or two.

The effects of an aging and declining population without an injection of talent and opportunities aren’t unique to our region. It’s a global phenomenon. Rural populations have declined in Europe and Asia. Local organizations must continue working together to promote economic development to retain and attract talent as well as increase support to existing businesses in rural areas to ensure their long-term sustainability.

Rural communities in Sweden have experienced declining populations as most young people move to larger cities in search of better job opportunities. To address this, the Swedish government introduced initiatives to promote entrepreneurship and attract new businesses to rural areas.

In the Negev desert region in Israel — a rural area facing similar challenges to rural America, although diverse — the population has aged and job opportunities are limited. The Israeli government has invested in infrastructure projects, including the construction of a new international airport, to attract businesses and tourists as well as provided direct support to rural small businesses to help them retain young talent.

Rural areas of Japan have experienced population declines due to an aging population and lack of job opportunities. The Japanese government has introduced initiatives to promote economic exchange, entrepreneurship and support small businesses.

Small businesses rely on a steady stream of customers to thrive. A lack of population growth can make it harder to attract and maintain customers, leading to a decline in business growth. While this holds true for any place, urban or rural, the challenge becomes more pressing in rural areas where small businesses often serve as the backbone of the local economies. A declining population can make it more challenging to attract new residents and retain existing talent, exacerbating the population plateau and further hurting the local economy.

To provide insights into population trends and the potential effects on economic development in the United States, the U.S. Census Bureau conducted a study titled “Demographic Turning Points for the United States: Population Projections for 2020 to 2060.” The study offered information for policymakers and business leaders to make informed decisions about the future of the country and local communities.

One of the key findings was the U.S. population is aging, with the number of people 65 and over expected to increase from 56 million in 2020 to 94 million in 2060. This demographic shift presents significant consequences for the economy, particularly in such areas as health care and social services. Demand for health care services is expected to increase and along with it demand for skilled health care professionals. The demand for such social services as caregiving also will rise. The demand for these services could increase for some time before the population reaches a point it can’t support these industries on the same scale.

The study also highlighted the changing racial and ethnic composition of the U.S. population and the implications for businesses and economic development organizations, particularly in terms of diversity and inclusion.

As the U.S. population ages, businesses must adapt. The work of economic development organizations becomes vital in providing access to capital, resources and training to help small businesses survive these changes. Organizations in rural areas face additional challenges.
As the population ages, it becomes more difficult to attract and retain young people and families, which can lead to a decline in the local economy.

To address declining populations, those involved in economic development need innovative approaches to attract and retain young people and families. Promoting job opportunities in industries that appeal to younger workers such as technology and renewable energy, for example.
Or finding ways to capture the young talents the university brings to the area. Another option would be working to improve the quality of life by investing in amenities and services that young people and families value — access to health care, education, high-speed internet and quality infrastructure.

Demographic changes forecast for the United States over the next few decades — including an aging population and changing racial and ethnic composition — pose significant implications for economic development and small businesses. The work of economic development organizations will be critical in adapting to these changes and ensuring long-term sustainability and prosperity, particularly in rural areas.

The success or failure of these efforts will determine the identity of rural areas and their roles in the economy and society. In the meantime, critical questions remain. How will the identity of rural areas change as we navigate these challenges? What are the best solutions to ensure success and prosperity?