All eyes are on Europe right now as millions of migrants and refugees risk the treacherous crossing from Turkey to Greece from the Middle East and North Africa. And while the European 'welcome' was applauded by the rest of the world, it hasn’t just been a feel good exercise.
Germany, Sweden, Italy and many other European countries are experiencing what some economists warn is a demographic crisis. Their birth rates are some of the lowest in the world and that is leaving a dearth of future workers to drive their economics and support their rapidly aging populations.
Germany's population hit 81.1 million in 2014 but it wasn't growing, it was shrinking. If nothing changed the German Statistical office was predicting the German population would shrink to 73.1 million by 2060 with a particularly strong fall in the proportion of working-age people. The share of 20 to 64-year-olds in the total population was predicted to be around half by 2060 compared with almost two-thirds in 2013. Economists argue this inbalance in the ratio of workers to retirees is unsustainable.
But why is this happening? Generatlly speaking it's because of the many individual choices made by women who are educated and affluent. German women, like women around the world, have for many years been choosing to have smaller and smaller families. And increasingly, they are fond of only children or as they call them in Germany Einzelkind. In 2014 one quarter of families in Germany had one child while roughly a half choose to have just two.
It's a similar situation throughout Europe as the map below demonstrates.
In a world where growth is still considered critical for economic health, Generation Only wasn’t being celebrated. The World Economy Institute in Hamburg claimed that “No other industrial country is deteriorating at this speed. Germany cannot continue to be a dynamic business hub in the long-run without a strong jobs market.” Chancellor Angela Merkel warned in a speech in Davos earlier this year that Germany will lose a net 6m workers over the next 15 years, shrinking gradually over the rest of this decade before going into free-fall.
But none of these dire economic predictions took into account… the rest of the world.
Cue the migrant crisis of the summer of 2015 and 2016 with the arrival of millions of refugees and migrants on Greek islands and marching their way across Europe primarily to Germany. Opening the German borders for Merkel wasn’t so much a tough decision as a welcome solution to a looming demographic problem. By the end of 2015 more than 1.1 million people had arrived in Germany to start a new life.
The moral of the story is clear. While demographers love to warn of economic catastrophe for countries with falling populations, the reality is very different. Much of the world, including some of the most unstable places in Africa and the Middle East have burgeoning populations with disproportionately large numbers of young people. More than 28% of the population of the Middle East is aged between 15 and 29. The Brookings Institute calls it “an unprecedented Youth Bulge.”
This bulge is already creating an enormous problem with unemployment as local economies fail to absorb such large numbers of young people. According to the World Bank "In many Middle Eastern and North African countries youth unemployment for men is as high as 40% and for women even higher. And the more educated these young people are the fewer job opportunities are available."
It's no coincidence then that young people, mostly males, are a large proportion of the economic migrants and refugees you see making their way to Europe in search of job opportunities and a better life. Less than half the migrants who have so far arrived in Germany are Syrians fleeing war. Many are from North Africa, unemployed young people wanting a job.
According to the United Nations the continent of Africa is expecting a baby boom in coming decades and a doubling of its population by 2050, which means Africa will have a population of more than a billion people under the age of 35. It's a looming demographic Tsunami.
Until Africa and the Middle East stabilise politically and their population growth slows, the exodus of economic migrants and refugees to countries with declining birth rates will continue.
In 2014 there were 13 million children living in Germany, 4 million of whom are only children. Had their parents not stopped at one there would be 4 million more children in Germany. That's four million more potential workers. Would this have been enough to stop the Germans opening their doors to refugees and migrants this summer?