Māori and the [potential] demographic dividend

Abstract

This paper outlines a recently articulated concept in the demographic literature known as the ‘demographic dividend’, and connects it with key features of Māori and non- Māori demography. The dividend arises – or has the potential to arise - as each population passes through a particular point in its demographic transition. During these years, the maximum proportion of the population moves into the key working and income-earning age groups, and the minimum (comprised of youth and the elderly) is notionally dependent. With proactive and timely investment in the youthful base of the population, there is potential to convert the demographic dividend into two economic windfalls, the first arising as fertility decline causes youthful dependency to fall and the last large waves of young adults flood into the working age population, the second as the latter age and move on into the higher income earning age groups. However the window of opportunity to invest in the first dividend is fleeting, while failure to invest in that stage seriously compromises the second. This paper shows that for the Māori population, despite its relative youth, the first opportunity is already coming to an end and with it the potential gains of the second. But it also argues that there is a third window of opportunity which holds particular promise for Māori. This period will also be fleeting, but is arising in both absolute and relative terms as the relatively youthful Māori population co-exists alongside its structurally older counterpart, and together (with other New Zealanders) comprise an ‘economic dividend system’ that produces the potential for a ‘collateral dividend’.