Working-age population and total population: The source of difficulties with public finances

As a first approximation, we can consider that public spending is linked to the total population (children and pensioners generate public spending) whereas tax revenue, for a given tax burden, is linked to the working-age population (employment generates taxable income in one form or another). We compare changes in the working-age population and in the total population, both in the past and forecast for the future. A smaller increase in the working-age population than in the total population is therefore offset: Either by a rise in the employment rate, but this cannot be perpetual; Or by a growing fiscal deficit; Or by an increase in the tax burden; Or by a reduction in public spending relative to its spontaneous trend. We look at these trends in the United States, the United Kingdom, Germany, France, Spain, Italy and Japan. We see: A rise in the employment rate everywhere; An increased fiscal deficit in the United Kingdom, the United States, France, Spain and Italy; A rising tax burden in the United Kingdom, France, Spain, Italy and Japan; A reduction in public spending in the United Kingdom and Spain.