The Birth Gap Trap and Brexit

The Birth Gap Trap and Brexit

Europe has a problem, a big problem, and almost no one is talking about it; it has a Birth Gap of over 30%.  While the debate turns to whether Turkey will be allowed to join the European Union, few appreciate that the EU needs Turkey more than Turkey needs the EU; other than tiny Ireland, it has the only growing population in Europe.  Yet Turkey can only be a small part of the solution; a much larger immigration solution is needed to prevent Europe from entering a decades-long economic winter.  Angela Merkel and David Cameron know this; history will judge why they have chosen to remain silent, for there is still time, at least for the UK, to do something about it.

Interestingly in the UK, ahead of this week’s ‘Brexit’ vote, it isn’t only Cameron who has ignored Europe’s population collapse.  Both sides of the debate have avoided, or, are unaware of, the long term population implosion that is occurring across Europe.  However, the United Kingdom is one of the few countries that can, possibly, escape from the Great Birth Gap Trap. Britain unquestionably needs immigrants to compensate for its own 15% Birth Gap. Contrast this with the extraordinary immigration requirement across the rest of Europe; Germany, with a 51% Birth Gap, needs one immigrant per baby born to be able to maintain its own workforce.  The UK’s immigration requirement is modest and manageable by comparison.

Germany has the lowest birth rate in the world. In 2015 it had less than half the babies than retirees.

Germany has the lowest birth rate in the world. In 2015 it had less than half the babies than retirees.

Collapsing workforces mean a fall in the number of taxpayers, and that inevitably brings negative economic and social consequences. Who will pay the national debts created by larger populations before them? Who will fund pension schemes and look after vast numbers of elderly?  Who will invest in shrinking economies and what will happen to vast amounts of surplus housing?  These are issues that need to be brought to the attention of people today, David Cameron, so the UK can have the facts about Europe’s future before its historic referendum.  Frequent flyers may be used to hearing the message ‘put on your own oxygen mask before helping others’.  I have no vote in this election, but as a former UK resident, that is what I passionately hope the British will do this week.

In total, twelve European countries had Birth Gaps of 30% or more in 2015, with only Ireland and Turkey having an increased birth rate.   But that number is only one element of this disturbing story, because Birth Gaps inherently increase over time, even if the Fertility Rate stays unchanged.  Fewer children mean fewer future mothers, which means even fewer children, and so on.  Only when we increase the average children per couple to above two, will a country’s population stabilize. Today, at 1.2, Germany’s Fertility Rate is the lowest in the world, and has been below two since 1971; it shows no sign of increasing.

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The Birth Gap problem is a mathematical one, but thankfully the maths needed is elementary.  Imagine that a region of the world decided to have fewer children, for whatever reason, and produced on average only one child per couple, instead of two. Of course it will take time for this reduced generation of children to grow up, and for the generation that preceded them to age and die, but the underlying population of that region is predestined to reduce by fifty percent from that single generation’s decision to have fewer children.  That might be fine to many, and even desirable, but it doesn’t stop there.  For the population to stabilize, the Fertility Rate needs to immediately return to two (actually, to 2.1 to be pedantic).  If the second generation follows their parents and has only one child per couple, the population will again half, and so on.  After four generations, the underlying population would shrink to round 6% of its original size, albeit it would take a a little time for elderly to pass on.   That is what has been happening in Germany and much of Europe for forty-five years; a parallel increase in survival rate has led to increased lifespan, and hence the total population count has remained generally stable until now. Soon however, the aging generations of Europe will pass on, and the scale of the population implosion will be felt by all.

pyramind-3

It’s easy to imagine that a simple solution to this spiral would be for a country to increase its Fertility Rate, when its ready to do so, yet there are inherent complications with such a turnaround.  From the moment a country starts to produce more children, there is an increase in the ‘dependency rate’ for around two decades before newborns enter the workforce; more taxes need to be spent on schools, and healthcare and welfare costs increase.  What incentive can there be for young people in such countries to have large families, when they will already be supporting a large number of elderly, both directly and through welfare taxes?  Certainly, looking at the data across Europe, other than Ireland, and possibly the UK and France, all other countries are on a negative spiraling path that will see huge economic and social turmoil, with or without immigration.

The UK and France are at the cusp, each with a Birth Gap of around 15% in 2015.  On a regional basis, both nations are maintaining, or growing their populations in their capital cities, but are experiencing large Birth Gaps in some regions.  The path is clear; unless France and the UK change something to produce more children soon, they will follow the same negative spiral that haunts Germany, Italy, Spain, Portugal and Austria, where the Birth Gaps are around 40% or higher.  It has been written by authors on the subject that no shrinking population in history has been able to reverse the trend.  Yet not telling people what is happening is surely misguided while they still have the opportunity to consider and prepare for what is ahead.   That might lead to more babies being born, or, to people making choices to better prepare for their own retirement in a shrinking world. One such choice is acceptance of mass immigration, or not.

So, Germany and much of Continental Europe has to either accept the economic pain of fewer people to pay national debts and support the pensions of the elderly, or, to prepare for vast immigration, on a scale the planet has not seen in living memory.  Yet Immigration no panacea; unless immigrants contribute to increasing the birth rate, ever more immigrants will be required.  Contrary to popular opinion, first generation immigrants typically have very small families while they spend a decade or longer adapting to their new homes.  Second generation immigrants tend to adjust to the local birth rate, not that of their former home nation.   The immigration option will become more essential over time, but  can only be a success if countries like Germany create an environment for the newly arrived to settle quickly, and contribute to increasing the birth rate.

The European Union needs people from Turkey to join its dwindling workforce in order to prevent an economic winter that will last decades.  Yet Turkey alone can’t solve the problem, given the scale of the Birth Gap deficit.  In 2015, the EU produced 2.3m fewer babies than will be needed to support its future workforce.  Of that shortage, Germany has the largest gap with only 0.7m newborns to support 1.41 million future retirees.  From the historic Birth Gap alone, immigration in the tens of millions will be needed by much of Continental Europe just to replace retiring workers.  With the Birth Gap accelerating, that number can be expected to grow in the years ahead.

The intention of this blog, and maps on the birthgap.com website, is to make people aware of the consequences of Birth Gaps, and not to admonish those who make a life choice, or whose circumstances lead them, not to have children.  Societies need to be aware of these consequences; large, sustained Birth Gaps, such as the one that has developed across most of Europe over the past four decades lead to economic turmoil and dramatic social change. Ahead of this week’s referendum, Britain needs to consider that its immigration issues are very different to much of the EU. It should put on its own oxygen mask on first, rather than become entwined with its neighbours’ dire problems.  David Cameron will never say that, but in the days ahead, the Leave campaign need to.

Stephen Shaw

 

 

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