Signal Ageing alone will cut per-capita GDP growth, most sharply in Korea

Summary

Demographic change is undermining economic growth itself before it shows up as fiscal strain. According to the McKinsey analysis summarized in the article, the change in age composition alone will lower annual per-capita GDP growth in first-wave countries by 0.4 percentage points on average. Korea faces a drop of 0.7 percentage points a year, the steepest among the countries analyzed. Korea's total fertility rate was 0.72 in 2023, among the lowest in the world, and its support ratio is also falling rapidly. The author therefore places Korea on the front line, experiencing earlier and more intensely the problems other first-wave countries will face later. Growth is weakening just as support burdens rise, creating a double squeeze on public finances.