Dependency ratio

The dependency ratio is an age-population ratio of those typically not in the labor force (the dependent part ages 0 to 14 and 65+) and those typically in the labor force (the productive part ages 15 to 64). It is used to measure the pressure on the productive population.

Consideration of the dependency ratio is essential for governments, economists, bankers, business, industry, universities and all other major economic segments which can benefit from understanding the impacts of changes in population structure. A low dependency ratio means that there are sufficient people working who can support the dependent population.^[2]

A lower ratio could allow for better pensions and better health care for citizens. A higher ratio indicates more financial stress on working people and possible political instability.^{[citation needed]} While the strategies of increasing fertility and of allowing immigration especially of younger working age people have been formulas for lowering dependency ratios, future job reductions through automation may impact the effectiveness of those strategies.