International Policy

Demographic Disaster Looming For Europe

Because of government policies designed to protect European workers from economic hardship, the continent faces the prospect of too few future workers and too many retirees. European countries could have eased its demographic problems by permitting greater immigration of workers, some economists contend.

Birth rates are below worker-replacement levels in Italy, France and Spain.

  • In Italy, for example, the number of people in their prime child-bearing ages of 20 to 34 is expected to shrink by 30 percent over the next 12 years -- while those 65 and over will increase 15 percent.

  • Birth rates in Italy are down 13 percent since 1985 -- and are only at about half the level at which parents replace themselves.

  • Experts say it is no coincidence that youth unemployment in Italy is now 33 percent -- and 26 percent in France, where birth rates have fallen 16 percent since 1985.

  • Demographers point out that people avoid having children when unemployment is high and economic conditions are bleak -- such as happened in the U.S. during the Great Depression, when birth rates dropped 26 percent in 10 years.

Unemployment is so high, experts contend, because most European countries have such a heavy layer of labor laws and mandated health and pension benefits. High unemployment has dissuaded many young couples from having children in an effort to avoid additional responsibilities.

In 1995, the median ages of Europe and the U.S. were only about two years apart -- 36 and 34, respectively. But in two decades the U.S. median age is projected to be only about 37, while half the people in Europe will be 45 or older. Italy will have a median age of nearly 50 by 2020.

The cost of caring for this aged population will be extraordinarily high.

Source: Peter Francese, "The Gray Continent," Wall Street Journal, March 23, 1998.

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