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The Old Country—Europe

EUROPE

Population: 738.8 million (9.9 percent of world total)

Projected 2050 Population: 706.8 million (4.5 percent decline)

Number of Countries: Forty-four countries and four dependencies

Largest Population: Russia (143.4 million)

Smallest Population: Vatican City (801)

Largest Economy: Germany (#4 by GDP)

Smallest Economy: San Marino (#168 by GDP)

Landmass: 8.5 million square miles

Density: 87 people per square mile

Growth Rate: 0.06 percent

Projected 2050 Annual Rate of Growth: -0.21 percent

Median Age: 41.9

Projected 2050 Median Age: 46

Of all the regions in the word, none appear to be as demographically challenged as Europe. Based on the data above, can you tell me why?

If you focused on “growth rate,” you get a gold star. The population of the region as a whole is basically not growing at all, and many European countries are already experiencing population declines. For some of these countries, that decline might be in temporary suspension depending upon how many Syrian refuges might be coming in, but once the Syrian crisis ends, any such declines will likely resume. Absent the immigration crisis, the countries of Russia, Germany, Spain, Ukraine, Poland, Romania, Greece, Portugal, Hungary, Belarus, and Serbia have all been in population decline. Or to put it another way, the populations of 11 of the region’s top 20 most populated countries are falling.

Low and declining birthrates are the primary cause of the decline, though Russia also has an exceptionally high death rate, and many Eastern European countries are also losing population due to emigration. Other than during the First and Second World Wars, I don’t believe that Europe has suffered population declines since the Great Plague. And some governments are taking measures to stem the slide, from encouraging immigration to offering bonuses, tax breaks, and subsidies to families having children.

OK, so do you notice anything else with the numbers at the beginning of the chapter?

You must have seen the median age? Perhaps a little old? And yes, that could compound the potential problems caused by a declining population. Who’s going to pay for all of those old folks as they continue to age, and how are the fewer numbered younger folks going to afford to pay off all the accumulated public debt?

While many European countries have been economically stagnant since the end of the Great Recession, I cannot conclusively point to demographics as being part of the cause, but I do wonder if they might be having a bit of impact. My guess, though, is that any potential negative impacts from declining populations haven’t come home to roost yet, especially given that the declines, for the most part, are thus far gradual. And the rise of the median age has not been especially rapid, which I believe helps countries better weather the potential impacts from that. Europe may be old, but, unlike some other regions and countries, it’s not aging especially fast.

Europe’s most demographically challenged country would be Russia, which has among the highest death rates in the world.

RUSSIA

Population: 143.4 million (1.93 percent of world total)

Projected 2050 Population: 128.6 million (14.8 percent decline)

Landmass: 6.3 million square miles

Density: 23 people per square mile

Growth Rate: -0.01 percent

Projected 2050 Annual Rate of Growth: -0.31 percent

Median Age: 38.9

Projected 2050 Median Age: 41

2015 Annual GDP Growth: -3.7 percent

Projected 2020 Annual GDP Growth: 1.5 percent

GDP Rank: 12th

The country’s population has fallen by almost 5 million in the past twenty years and is projected to lose at least another 14 million people by 2050. While many economists had forecast that Russia’s population decline would erode its economic output, it hasn’t happened to any great degree yet. In part the country’s economy is being sustained by being resource driven, and while the population has been declining, its labor productivity has been rising.

Going forward, Russia’s demographic transition, and impact on its economy, will undoubtedly be about the most closely watched of any country by economists and demographers.