This week, the globalEDGE blog is taking a look at long-term mega trends that will have a major impact on international business in the coming years. Today, the focus is on changes in demographics and society, and how these factors can influence business decisions. Being aware of demographic and social shifts is vital for businesses, especially those who are conducting business across international borders. Changes in population or consumer attitudes can force businesses to adapt, or risk losing their place in the industry. Because of this, many businesses are constantly looking to the future to try to get ahead of the trends before their competitors can.
A major area of concern for many businesses is the distribution of population among age groups, especially when comparing countries. Most developed economies have seen low fertility rates for the past several decades, which means the overall population is aging. This impacts the number of working age people, along with governments who have to support the older population. Many businesses are already preparing for declining populations, for example in Japan and Germany. In other areas of the world, especially under-developed countries, the working age population, the biggest spenders in an economy, is growing, which could allow for new business opportunities. By paying attention to global population shifts, companies can make sure they are expanding into areas ripe for growth.
Social change can also have a profound impact on a business. Customer’s attitudes constantly are changing, and analysis of trends in consumer preferences is a major part of almost all businesses. Social attitudes about living and working also are always shifting, seen especially in the so called millennial generation. Businesses that want to attract and keep top talent must be aware of trends in employee preferences, which can be difficult given the usual age disparity between executives and incoming employees.
Keeping an eye on future trends is what makes many businesses successful, and changes in population and society is often one of the first trends companies look at. Check back with the globalEDGE blog the rest of the week, as we look at trends in global economic power, urbanization, climate change, technological breakthroughs.