Ireland will not be spared from Europe’s brewing demographic crisis

A rich and elderly population that jealously guards its privileges and votes to maintain a deeply unequal society where the younger workforce it relies upon does not have the same rights. It’s an ugly picture, and it might sound like science fiction.

But this is what Europe’s demographic trends foretell, and the reforms that could help to avoid it are currently prevented by a variety of political Catch-22s.

The European Union’s population is set to shrink 6 per cent by 2100, according to new Eurostat projections, while those aged between 15 and 29 are expected to dwindle to just 15 per cent of the population by 2050.

There may be lessons to be learned from the predicament of Italy, which is a frontrunner in ageing demographics. Its workforce is split between a group of generally older people who enjoy strong protections and better pension rights, and a younger underclass of people who move from temporary contract to temporary contract or work off the books, with little rights or security.

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Migrants and their children feature heavily in the second group. Many of them are politically disenfranchised: some one million people who were born in Italy but whose parents came from overseas do not have citizenship and therefore cannot vote.

Precarity makes it more difficult to start a family, and many talented young people with fewer prospects emigrate from Italy. It’s a vicious spiral, one which compounds the demographic trend of ageing and concentrates the voting power of older people, making politicians beholden to preserving the interests of this group.

Towards the east of Europe it is not a coincidence that progressive parties have struggled and reactionary politics have come to dominate as younger and outward looking people leave for opportunities elsewhere. For example, in Poland, whose population is forecast to drop by 21.6 per cent by 2100, ultra-conservatives are obsessed with controlling the fertility of the very young women they are driving away.

Falling birth rates and ageing populations: what will this mean for the world?

Listen | 23:31

Wonder why many people delay having children? Take the situation of a young woman I know in Dublin. She and her husband needed two incomes to afford to move out of her parents’ house. But because there was no childcare place locally for their baby, she faced losing her job. The process of having children needs to be structurally normalised and accommodated in order for it to occur. Once that support for young families is gone it is extremely difficult for policymakers to engineer back into place.

History indicates that older societies are less politically volatile than younger ones. But before we get there there are some difficult political fights to be had.

European societies are built upon an inter-generational contract. Working age people pay to support those in other stages of life, trusting that when it comes to their own old age they will be looked after too. The demographic shift under way poses a serious challenge to this arrangement. But the policy choices available are politically taboo.

The issue lurks behind the furious protests against the pension reforms proposed by French president Emmanuel Macron. Where France had about four working people per retiree 50 years ago, it now has roughly 1.7, and this number is forecast to continue falling. But many young people are outraged by proposals that some people should work for longer: understandably they want the benefits of the past to apply to them too.

An alternative policy choice to make the maths work is to increase immigration. Almost entirely due to newcomers and their children the populations of Sweden and Luxembourg are projected to buck the EU trend and steadily grow this century, rising by 55 per cent and 27 per cent respectively by 2100, according to Eurostat.

But of course the politics of anti-immigration have made this a taboo choice. Even as European countries rely on doctors, nurses and carers who have been trained elsewhere to cope with their older populations, existing citizens lobby against granting them equal rights.

Ireland’s higher fertility rate and younger population mean this scenario is further down the road. The Eurostat projections foresee Ireland’s population growing to peak in 2060 at just over six million, before it starts to shrink for the rest of the century.

But policymakers should not be complacent. The country is currently suffering from stark demographic inequality due to the generational lottery involved in property ownership. Many working age people are not only paying to maintain older people through taxation of their wages – but through their sky high rents.

The long time scales of demographic projections mean they are highly uncertain and much could change, and Irish young people often vote with their feet.