When population in a country is growing, the number of children entering school every year rises. Therefore, the government or private educational institutes have to invest money in meeting the increased population by purchasing new lockers, desks or printing an increased number of textbooks, for instance. If the number of children in a region rises critically, then building new school complexes become vital, as well as the hiring of more educators. A notable example is the case of the Solomon Islands, in which the school-age population increased by 71.5 percent between 1990 and 2010, according to former Prime Minister Derek Sikua.
Increased costs combined with high population density can lead to solutions that compromise the standards of education provided. For example, when state education officials ordered the Detroit Public Schools administration to balance the district's books by closing half its schools in February 2011, the Detroit News estimated that high school class size would increase to as large as 60 students.
The income of educational institutions comes either from direct payment of tuition fees or through taxation. This income is imperative for an institution to fund its research, maintain its facilities and pay its staff. However, when population shrinks, so does the number of new students and subsequently the income of educational institutions. For instance, according to Times Higher Education, European universities "need to shrink by 2020 or recruit large numbers of overseas students to adjust to demographic changes."
According to the "Population, Education and Development" report, published in 2003 by the United Nations, the level of the education attained affects people's time of entry into reproductive life and the fertility rate. Men and women choose to continue their education and then pursue a professional career in their educational field, postponing the birth of their first child and limiting the number of total children attained. However, this trend can have a boomerang effect as the case of universities in Europe -- a region with very high literacy rate -- proves. Fewer students entering the education system, results in less income for those institutions.