The Greying of Greece Threatens Economic Recovery

(File Photo by Eurokinissi/Panagopoulou Georgia)

ATHENS – Besides straining the country’s social security system and ability to pay pensioners, Greece’s aging population is jeopardizing long-term economic prospects and a recovery from a more than eight-year-long financial crisis, data and warnings from analysts has shown.

When the crisis began in 2010, Greece’s active population, those from 20-64, was 7.045 million but has already shrunk to 6.8 people, expected to get worse with fewer having children, many saying they can’t afford them now.

People aged 20-40 years account for 40 percent of the population now compared to 46 percent in 2010, said Kathimerini in a report on the phenomenon. The United Nations estimated that Greece’s population will fall to 6.5 million, only 2.3 million in the 20-40 age group.

The number of people aged 65 and over is expected to soar to 2.535 million by 2025 from 2.1 million in 2010 and 2.237 million in 2015 with a critical indicator, the number of children up to the age of 4 years old, fell from 585,000 in 2015 to 503,000 in 2015 and is expected to plummet to 404,000 by 2025, the UN data showed.

The fertility rate – children per couple – stands at 1.26 compared to 1.49 in the European Union. According to the EU’s statistics agency Eurostat, Greece and Italy have the third lowest fertility rates in the EU, behind Germany and Portugal.

Zsolt Darvas, a senior economist at the Bruegel think tank, told the newspaper that said Greece’s demographic problem poses a threat to the country’s fragile economic recovery, foreseeing a shrinking of the Gross Domestic Product (GDP,) investments and growth, mirroring what former International Monetary Fund official Bob Traa told the paper.

The country’s protracted economic crisis has resulted in a faster demographic slowdown than previously expected, Traa wrote, warning that it could take a full generation for the Greek population to stabilize from the impact of the “economic shock.”

PENSION SHOCK

With a growing population of elderly, exodus of the young looking for work in other countries and companies ducking paying social security taxes, Greece’s sinking pension system is facing big trouble in sustaining itself and is expected to have a deficit reaching 37.3 billion euros ($43.17 billion) in the next few years.

Those were among the findings in August of a study by Panteion University Professor Savas Robolis and PhD student Vassilis Betsis that showed the combination of whammies hitting the system, with fewer people paying into it and more taking out of it, said Kathimerini.

The aging population will incur a cost of about 1.3 billion euros ($1.5 billion), starting in 2017 up to 2057, or the equivalent reduction in benefits to the insured and pensioners.

The researchers found that even increasing the retirement age, part of conditions demanded by international creditors in return for three bailouts of 326 billion euros ($377.33 billion) hasn’t been enough to offset other factors and while the standard will be 65 years old by 2022, the European Commission said it should be 71 by the year 2060.

The increase in the retirement age will increase the workforce, especially of women, and the aging of the labor market but lead to a reduction in the number of young workers due to reduced fertility and because they, too, will have to work more years, cutting into productivity it was said.
the fact that people will be working longer.

The researchers point out while Greece aims for annual growth of 2 percent, the negative impact of aging will mean that growth of 4 percent will actually be necessary.

7 Comments

  1. Whether you are a Greek living in Greece or in the Diaspora, if you are of baby-making age, please know that the survival of the Greek people depends upon your generation having babies–and babies who will be raised with a consciousness of Greek values and traditions.

    A continued fertility rate of only 1.26 is a death sentence for a people.

    1. Greeks are no different than any other ethnic group…. they love children and families, but can only afford to have children by the amount of money they need to properly bring them up! As for retaining Greek values and traditions to maintain the culture of Greece… you will have to have a society….which does not tolerate foreign governments and white supremacist in the EU , United States and Nato…. do dictate the values and interests of Greece, and erase their cultural identity!

      Therefore the solution …is removal of Greece from the EU and Nato …and remove all foreign countries from bases in Greece…. and not allow them to force migration quotas and breech the borders of Greece…. to comply with the dictates of the EU and the United States …to replace the thousands of young Greeks leaving Greece to find economic opportunities with non -Greek migrants from the Middle East, that have no cultural identity to Greece!

      The solution is for Greece to resurrect the Drachma and …control their currency to have financial flexibility … to manipulate the exchange rates of its currency…to it advantage in confronting economic crisis! No better example….than Switzerland..who has a Hybrid relationship with the EU…which allows her to have her own currency….and was able to adjust her exchange rates to save her economy in 2008!

      Maybe….there is no Patriotic incentive to have more babies ….only those that allow them to economically provide them as part of a family….and not being part of a welfare family of the government …where much of the U.S population is going …with the highest out of wedlock baby population in the world!

      Maybe… then …the government can generate more Greek babies …by reducing significantly the Tax liabilities of families with multiple children, which provide an incentive to have more babies, because the expenses will be subsidized by lower tax expenses!

    2. When you say that “Greeks are no different than any other ethnic group,” you minimize the seriousness of the problem. Greeks, with a TFR listing of only 1.26, have fertility that is markedly lower than almost all of the 200 entities whose figures are tracked by the UN. Out of 200, Greece ranks #195. And 118 of those places have TFRs of 2 or higher, including Turkey.

      Of course, other European nations, although their TFR rankings are not as low as Greece’s are recognizing that a low TFR is a problem and have been trying some economic incentives as you suggested–to no avail. Other political changes that you suggested might be pleasing to you for other reasons, but I doubt that more babies would result from them.

      We are really in uncharted territory here. I cannot think of a time in the history of the world when a nation developed such a low birth rate and then managed to turn it around. But, as you apparently hinted, this can and should ultimately be promoted as a patriotic matter to the young people in Greece and in the Diaspora.

  2. I will repeat, John, “Greeks are not different than any other ethnic group” because they all would love to have children and a family! That is not minimizing the seriousness of the problem in Greece, but highlighting the opportunity for Greece to not only rebuild their economy, but their population!

    Being a part of the EU and Nato….has done nothing for Greece…but contributed to the economic and political environment which …is draining Greece of its youngest and talented citizens, while adding the migration of non-Greeks to the shores of Greece, with no cultural respect for Greece and its traditions!

    While not being a part of the EU and Nato ….may not produce more Greek Babies… it has clearly shown based on the above facts….that whle being a part of their communist central alliance……the prognosis is a continuation of the decline of the Greek population and its quality of life!

    Finally John, you are absolutely derelict to believe, that New borns of Greek decent …. will be raised to adopt the culture, values, and traditions of Greece, when the whole objective of the EU and Natol…is to HAND OVER , the sovereignty of Greece and the other members of the EU…. and to transfer their National interests and culture to the control of the EU and Nato!

    So John, you can wine all you want ..but Greece needs …is not telling us what the problem is …but telling us what the solution is fundamentally…. an economy that supports its citizens…and make is affordable for Medical care and Health…and provides the means to afford to have and raise children!

    Secondly, an INDEPENDENT COUNTRY IN CONTROL OF THEIR ECONOMY, POLITICS, AND MILITARY….AND INCLUDES THEIR OWN CURRENCY AND ECONOMIC POLICIES …WHICH FUNDAMENTALLY MEANS THEIR OWN CURRENCY!

    The patriotism comes when you are a proud Greek …who beleives in their country…. and make a commitment to live in Greece…. and build their life in Greece….because their is a future!

    And right now… their is no future plan with the EU and Nato!

    1. Yes, we all know you hate NATO and the US. But thankfully, in the midst of your latest long posting, you at least admitted that “while not being a part of the EU and Nato ….may not produce more Greek Babies.”

      And more Greek babies is what is called for. Plenty of nations with far worse economies and health care still mange to have enough children.

      Please save your hate-America rants for other articles; you will have many chances.

    2. Save your” MY COUNTRY RIGHT OR WRONG” MANTRA for the policies of the United States, not Greece! There is no place for your narratives…since, it is blinded by a false form of Patriotism ….which manifests itself in the Greek american secret societies….who worship the Glory of America…. and suppression of the Truth ….at any cost …which offends those followers of America…which are no different than the Brown Shirts of Germany…who also were offended by the truth….about their country!

      You remind me , of those Greek American leaders , who embraced and cheered on Alexis Tsipras , when he came to New York for a UN meeting….which in the opinion of many Greeks …would equate to having German Jews in America…embracing a visit from Adolfh Hitler… and demonstrating support for his actions in Germany!

      I really think you should dismiss yourself from any discussion on Greece and Cyprus….since,, it is clear….that the interests of the United States and Nato….are of greater concern than the people of Greece!

      To even defend the United States and Nato ….in light of what they contributed to the invasion of Cyprus in 1974 by supporting Turkey in ethnically and religiously cleansing Greek Cypriot, in supporting an economic Bailout program that represented the interest of U.S Banks , in ordering the hand over of the Macedonian Culture…is nothing more than a betrayal of all Greeks!

      You are correct …. I and others hate what America has become… and only those who remain silent to their actions…. which destroy the Hellenic Values of Greece , and who was the foundation of our Democracy………….are not Patriots ,but Traitors not only to our country , but the world!

      I stand by my post…. and regret ….that you are unable …. to separate facts from fiction , and provide and argument that refutes argument with facts, like I have done in my reply!

    3. Just to clarify: I am not in AHEPA. I do not care for Tsipras.

      I have made numerous posts on the internet that non-Greeks will read, regarding the injustices suffered by Greece and Cyprus due to the policies of the US and Britain. I have also posted on the internet in defense of Russia’s recent actions regarding Ukraine. It is a shame that the US and Russia are not cooperating with one another, and I place the blame for that noncooperation upon the US.

      Alas, none of that is likely to please you.

      But to return to the article topic: In the event that any other Greeks will read this thread, possibly younger Greeks, please, young Greeks, remember to have several children.

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