Europe’s Struggle to Raise Birth Rates: Can the Pessimistic Outlook Be Changed?

Demographers and economists say European countries have been trying for years to raise birth rates without success. In the photo, Italian Prime Minister Meloni (left) and Pope Francis attend a conference on demographics. Photographed in May 2023 in Rome. Provided photo (2024 Reuters/Vatican Media)

(Reuters) – For French President Emmanuel Macron, having more children is important to maintaining the country’s vitality. Italian Prime Minister Meloni has also made encouraging more women to have children a top priority for his government.

But European countries’ attempts to raise birth rates have been unsuccessful for years, according to demographers and economists. What they are urging is a shift in thinking to accept the socio-economic reality of a declining birthrate and aging population, and to respond appropriately.

Associate Professor Anna Matysiak, who has researched the labor market and family dynamics at the University of Warsaw, has seen that in Central European countries, childbirth encouragement policies of “Have more children” continue to fail to achieve their goals. It’s very difficult.”

It is true that the birth rate in Europe has remained at around 1.5 for the past 10 years. Although not as low as in East Asia, it is well below the 2.1 required to maintain population size. Matysiak and other researchers interviewed by Reuters believe that the 2.1 figure is highly unlikely to be achieved in the foreseeable future.

In addition to basic welfare policies, European countries have spent billions of euros to encourage their citizens to have children, including cash payments to child-rearing families, tax credits for large families, and parental leave schemes. .

However, even France and the Czech Republic, where birth rates used to be relatively high at around 1.8, are now showing a downward trend.

The reasons for this vary by country and region, and in some cases are not completely understood.

Marta Says, a university professor in Madrid, the capital of Spain, who researches family sociology, population dynamics, and inequality issues, points out that housing is a factor in the country’s birthrate, which remains at 1.19, the second lowest in Europe after Malta. He cited soaring prices and job insecurity.

“People want to have children, and they want to have them at a younger age, but structural reasons prevent them from doing so,” Seis said.

These economic circumstances are common throughout Europe. However, there is also evidence that significant sociocultural changes are occurring around parenthood.

Even in Norway, a prosperous country with strong family support policies and secure employment, the birthrate has fallen from 2 in 2009 to an all-time low of 1.41 in 2022.

Last year, the Organization for Economic Co-operation and Development (OECD) cited changing gender roles, increased career aspirations, and the possibility that social media may be amplifying anxiety as reasons for Norway’s declining birthrate. He concluded by saying that the truth remains a mystery.

Finnish demographer Anna Rotkirch, while analyzing the situation in her country where the birth rate is similarly declining, focused on deep social and cultural changes, and found that many young people are now considering raising children in their lives. He explained that he considered other goals to be in a trade-off relationship.

“This really comes down to the question of what is a desirable, joyful, attractive life and lifestyle, and the diversification of values ​​and ideals,” Rotkirch said. No one knows what kind of family policy will be effective in raising birth rates in this new situation, he added.

Chart with data from Eurostat shows the average number of children per woman in 27 European Union nations from 2012-2021 with 2021 highlighted as red dot and rest are in grey.

So, as a result of this decline in the birth rate, Europe faces a bleak future based on a “demographic time bomb” scenario, in which society as a whole eventually shrinks, pension systems become unsustainable, suffer from chronic labor shortages, and the elderly I wonder if we are waiting for a development in which there will be no one left to care for the elderly.

In reality, this will depend on whether each country’s economic structure can create a system that can adapt to the declining birthrate and aging population.

David Miles, an economist at Imperial College London, dismissed the “ticking time bomb” scenario and said that if per capita gross domestic product (GDP) is maintained and people are able to work more and more efficiently, They argue that even if the population declines, a decline in living standards can be avoided.

Life expectancy is much longer, Miles said, and intense jobs are confined to a narrow range of industries in Europe’s service-based economy. For this reason, he expressed the view that the logic of setting retirement age at around 65 is seriously flawed.

Raising the retirement age remains a politically charged issue, as evidenced by the large-scale protests that erupted in France last year against President Macron’s pension reforms. However, since around 2000, the age at which workers retire in developed countries has been slowly but steadily rising.

Increasing the number of working women would have even greater benefits. In Europe, the ratio of working women to all women is approximately 69%, 11 percentage points lower than that of men, and their potential supply to the labor market is high.

Willem Adema, senior economist at the OECD’s Social Policy Department, said, “Women who are not yet in the workforce could be a huge additional economic resource going forward,” adding that flexibility, such as remote working, could be used as a way to encourage women to participate in the workforce. He mentioned things like introducing new ways of working.

Europe can also import more labor from outside the region if it overcomes its anti-immigrant rhetoric, and automation and artificial intelligence (AI) at least provide room for productivity gains.

Mr. Rotkirch of Finland said that although family policies that encourage young people to decide to become parents are still necessary, there is a need for a broader discussion on what should be done to address the low birth rate, which cannot be solved by traditional family policies alone. He says that is required.

“If we look at long-term trends and people don’t want to have children, there’s no point in forcing them to have children,” said the OECD’s Adema.

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Gergely reports on central European economics, central banking and government policy, with content usually appearing on the Macro Matters, Markets, Business and World sections of the website. He has nearly two decades’ worth of experience in financial journalism at Reuters and holds advanced degrees in English and Communication.

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2024-02-16 22:57:00