I had the chance to chat with Kenneth W. Gronbach, a demographics expert and frequent keynote speaker, about the only way to accurately predict the future: counting people. His new book, Upside: Profiting from the Profound Demographic Shifts Ahead, is a revealing examination into what really causes social and economic shifts: changing populations, from birth rates to death rates.
Your book is about predicting the future with accuracy. Can you explain why demographics provide clear evidence of where we’re headed?
Demographics precipitates economics — not the other way around. Commerce is reliant on market size, and market size is determined by demographics. Cultural shifts are determined by demographic changes. Demography is dependent on live births, deaths and migration, and so is politics. People are easy to count. It is math. So much of what people influence is determined by their number, their age, and where they are.
What are some of the key trends we’ll see in the near future?
The largest generation ever born in the United States is Generation Y (or the millennials), with 86 million people born between 1985 and 2004. They’re about to start households and will consume at levels we don’t understand. Over the next ten to twenty years the United States will need 25 million new housing units to accommodate them. Gen Y does not have a love affair with the automobile. They will live in cities. Meanwhile, 80 million Baby Boomers are living longer, and will reinvent our concept of retirement. Southern U.S. states will experience dramatic population growth. Heathcare, eldercare and death care will get hit with a Boomer Tsunami in about five years.
How can a business use the lessons in your book to shape its own strategy? For instance, brick and mortar retailers getting hit hard by online shopping?
The most important question in marketing is, “How big is my market and is it getting bigger or smaller?” Demographics can answer this question so you can prepare and strategize. With brick and mortar retailers it is good news and bad news. The good news: the number of consumers will increase with the huge Generation Y. The bad news: Generation Y favors buying online.
We just went through a presidential election that seemed to take millions of us by surprise. Could a better focus on demographics have prevented that?
Donald Trump won the nomination and Hillary Clinton lost the election. Democrats gain a voter every eight seconds because they come of age to vote. Republicans lose a voter every sixteen seconds because they die. The Democrats should have won easily — because there are more Democrats than Republicans. I forecast four consecutive presidential election cycles going to the Democrats starting in 2008. But I was wrong. I totally overestimated Hillary’s popularity.
We’re still a society and economy marked by wage inequality and a lack of inclusion and diversity in many businesses. What do the demographics say — are we ever going to improve on that front?
By 2045 the number of non-Latino whites in the U.S.A. will be a minority at about 45 percent. Generation Y, 86 million strong, do not see race or color, and will intermarry. By 2050 race or color will cease to be an issue in the United States — and women will lead.
How do you recommend getting more people to pay attention to demographics?
Read my book and attend my presentations. This is simple math and common sense. Once the light comes on, it doesn’t go off.
Is there one inevitable trend, as revealed by the demographics, that’s going to take us by surprise if we don’t start paying attention?
Yes: Death care. It’s simple: the United States does not have enough funeral homes, crematoriums or cemeteries to accommodate the number of dying Baby Boomers. This sets the stage for a total redefining of the process, perhaps by a big box retailer.
For more about Kenneth W. Gronbach and his book, Upside, go to KGS Direct.