Demographic Factors

Demography is concerned with the size and composition of a population. Changes in population dynamics occur slowly but can be significant for businesses.

Two key demographic changes in the UK that impact on many businesses are:

Ageing Population:

Some possible business implications are:

Greater demand for services to support older people (e.g. healthcare)

Increasing disposable incomes of older people reflected in higher demand for goods and services (e.g. holidays)

High levels of net immigration:

Some possible business implications are:

Higher costs of (but greater demand for) public services (e.g. education, health, housing)
Increase in size of labour force – potentially keeping wage rates lo

Businesses able to grow faster with a larger supply of labour (particularly in the agricultural and service sectors)