Alongside COP26, Glasgow hosted some expert gatherings of thought leaders. One of the most challenging discussions was in the Longevity Forum. The focus was on sustainability, but with some surprising evidence and conclusions. World population may not be on the upward trajectory built into current long-term planning.

Immediately ahead lie two or three decades of growth, mainly from longer lifespans. But the long-term trend will see numbers stabilise and fall. Stark evidence pointing to sharply declining fertility around the world means that many nations are already destined to shrink in the second half of the century. And in 80 years’ time, the world population total might be little changed from today, heading down. Without intervention, this will be a shock for many nations, both Western and developing. The result will be a very different demographic profile.

There are no quick fixes. Around the world, direct incentives to have children have generally not worked. In the past 70 years, the global fertility rate has nearly halved and this century will see a collapse in the population of several nations, including China. Half of the world population lives in nations with sub-replacement fertility. New thinking is needed.

While the ageing problems of Japan and Italy are known, births are also falling in the UK. Births registered in Scotland in 2020 were the lowest since records began in 1855. Although that was an unusual year, the last quarter pre-pandemic also set a record low. The pattern in England and Wales is little better; a steady decline in births, with fertility below replacement rate.

The factors involved are a mix of good and bad. Better access for women to education and careers brings delays to family formation and new views on family size and life/work balance. Surprisingly it is not just a feature of a few Western societies; women in every developed country have taken up more tertiary education. All of this is good news, but it interacts with declining fertility to impact population trends.

For reasons not entirely clear, male fertility has been declining for two generations, now estimated at around 50% of the level of 1970. Plastics, and plasticisers seem the most likely suspects. It is not simply about urbanisation – the chemical impact is widely embedded in food and soils. Added to pollution of the environment are some lifestyle issues. More research on all this is needed; current understanding of the population challenge seems just to be at the stage where global warming was 30 years ago.

The COP26 approach to reduce pollution and adverse chemicals in the environment is undoubtedly right. But even if world population is currently too high – and for perhaps two or three decades might grow further – does it really help to have fewer births? There is mixed evidence on the impact children have on emissions. Against the claims that the greenest thing we can do is stop having children, other academics argue that these carbon calculations are effectively double-counting with parents’ consumption. Assessment of future impact depends a lot on assumptions made about human behaviour on the planet in the decades ahead. Looking at the carbon footprint of children seems the wrong way to approach climate change and sustainability. They are the resource for change and tomorrow’s taxpayers.

Economic uncertainty seems also to be a factor; in many countries the 2008 financial crisis triggered a new phase of the decline in births. Now Covid has added a downward shock to the numbers. For example, US births over the pandemic are down 7%. Some of Europe shows a similar pattern, worse in countries with poorer family support.

Risk seems to have shifted on to families and children. Young adults delay leaving home and it is a much longer route to independent adulthood. The UK has one of the most expensive childcare systems in the world; a recent OECD analysis found that, relative to average wage, only Switzerland and Slovakia cost more. Addressing this economic insecurity needs to be embedded in new policies, with reforms to housing and wealth. The aim should be affordable childcare and education without debt. Raising families should be seen as an asset to society; a struggle to be shared. Helping to raise the next generation should be an investment.

In future more of the world may look like Japan. A study in the Lancet journal last year challenged existing UN population estimates. That is likely to mean a shrinking working-age population and labour shortages, possibly with countries competing for migrants to boost their populations. Migration already masks some of the underlying trends, so Scotland is not exempt. Scotland’s fertility rate has not been at replacement levels since 1973. Even before population numbers change much, the demographic shape will start to make the economy look very different.

The solution will be social change; recognising the importance of lowering opportunity costs for women in having families. There are signs that good support for working mothers, with high-quality affordable childcare, certainly helps. Indeed, some of the Nordic countries have already shown that slowing the trend with good family support is possible. In Sweden, this involves heavily subsidised day care and generous shared parental leave. This goes along with a culture ordered around community and family life. Even so, Swedish birth rates are still declining, but the trend has been much improved with social change.

The decline of reproduction rates below replacement rates will have social, political and economic implications that should not be ignored. The challenge needs much more research and to be given a central place in business and public policy. Demographics is a slow moving but powerful force. Policy and planning must look decades ahead, well beyond the timeframe of most public or business planning. It does point to the urgency of addressing food supply and pollution, but also to some key long-term benefits of progressive social policies.

Colin McLean is managing director of SVM Asset Management