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How Ford's Futurist Views Demographics

By Brendan Byrnes – May 19, 2013 at 10:45AM

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The Long-Range Impact of an Aging Population

Sheryl Connelly is the head of Ford's (F -2.60%) Global Trends and Futuring Division, where she separates trend from fad and helps the auto maker determine what global changes will influence the market in years to come.

A full transcript follows the video.

Brendan Byrnes: When you look at these trends, how far out are you looking? Obviously you're not looking for the trend next month, even next year. Do you go decade long?

Sheryl Connelly: Sure. It really depends on who I'm talking to, but we do explorations 5, 10, 20 ...

Right now I'm doing a lot of discussions about what 2050 might look like. You just start with demographics. Demographers would tell you that demographics are destiny. I'm not sure that's the whole story, but it's an interesting place to start because you can see where patterns of populations are migrating.

This aging population is interesting because of the dependency ratio. As you have an aging population, you have to ask yourself, how many workers do you have to support your retired population?

As that number becomes imbalanced in a place like Japan -- which is expected to be upside down on their dependency ratio; they'll have like 108 retirees for every 100 workers -- it means their economic output will drop, their famously high savings rate will dip, they'll have less money for innovation and investment.

This will mean that their technological prowess will decline, and their political influence and sphere of social reach will change.

That can be a really interesting conversation when you're talking about long term, where are the opportunities. Of course you also have to say, "What's Japan trying to do to change that? What are the programs and policies that they're putting in place?"

I don't predict what's going to happen. I just say, "Let's explore the what-if, the possibilities."

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