Europe must prepare for a new demographic reality
By 2050, people 65 and older will make up nearly 40 percent of the population in some parts of East Asia and Europe. Photo EPA, How Hwee Young
European Union
In large parts of Europe, the birth rate is falling. But that is only the beginning, experts say. The continent must prepare for a new reality.
The world’s demographics are changing, and it is easy to see that in Europe. Nearly every month, there is a country somewhere that releases figures. Usually, they are declines in birth rates or increases in the number of people over 65. One picture emerges from all these figures: Europe is shrinking. And it is shrinking fast. If current trends continue, some say, the Finnish population will be extinct by 2060.
But what we’ve seen is just the beginning, reported the New York Times last week. “The projections are reliable and stark: By 2050, people 65 and older will make up nearly 40 percent of the population in some parts of East Asia and Europe.”
Trends like these have major economic implications. With a growing population of pensioners needing more and more health care, the pressure on the working population is increasing. An ever smaller group has to bear ever greater burdens.
For Europe, it means rich countries, which often struggle most with their demography, have to change things. Things taken for granted, like pensions, retirement ages, and strict immigration policies, likely need overhauls to be sustainable. And as we saw in France, adjustments to this are not appreciated. Thousands of French people took to the streets for months to protest against President Macron’s pension reforms.
Contraception
Europe’s population decline has nothing to do with lower fertility. The BBC wrote back in 2020 that it is mainly because, compared to before, more and more women are getting an education and going to work. They also have more access to contraception, which gives women the choice of having fewer children. As the BBC puts it, “in many ways, falling fertility rates are a success story.”
The mid-20th century baby boom in the Western world created a large workforce that helped economic growth. But when fewer children are being born, society must adjust to this new reality. This, however, cause greater instability on the continent. Harsh governmental measures, whether necessary or not, fuel discontent and insecurities among the current working generation.
And according to experts the New York Times spoke with, these measures will inevitably lead to a shrinking in economic growth. Europe must therefore prepare for economically tougher times.
Reversal
Europe was thus able to benefit economically from population growth in recent decades. And while on this continent, this growth has reached a turning point, in Africa and other parts of Asia, a reversal is underway. “Soon, the best-balanced workforces will mostly be in South and Southeast Asia, Africa, and the Middle East, according to U.N. projections,” the New York Times writes.
But there, too, the sexual revolution is bearing fruit. The New York Times writes about Kenya, where birth rates have shrunk dramatically. “Women had an average of eight children 50 years ago, but only just over three last year.”
According to the newspaper, however, this development creates huge opportunities. “When birth rates fall, countries can reap a “demographic dividend,” when a growing share of workers and few dependents fuel economic growth. Adults with smaller families have more free time for education and investing in their children. More women tend to enter the workforce, compounding the economic boost.”
However, despite this “enormous upside,” as the American daily calls it, these developments could also backfire on economic growth. “If large numbers of young adults don’t have access to jobs or education, widespread youth unemployment can threaten stability as frustrated young people turn to criminal or armed groups for better opportunities.”
The world thus is heading towards a turning point demographically, reports the New York Times. While young countries must prepare for economic growth through good policies, rich Europe will have to transform and prepare for a contraction in the number of people in work. “If these countries fail to prepare for a shrinking number of workers, they will face a gradual decline in well-being and economic power.”
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