**In what ways will demographic trends help shape economic and foreign
policies of the EU out to the year 2020?**

***Discussion Paper***

**The views expressed in this and other papers associated with the NIC
2020 project**

**are those of individual participants. They are posted for discussion
purposes**

**only and do not represent the views of the US Government.**

National Intelligence Council 2020 Project Workshop

Budapest, 27-29 April, 2004

**In what ways will demographic trends help shape economic and foreign
policies of the EU out to the year 2020?**

***Discussion Paper***

**Introduction**

All European countries, be they advanced market economies or countries
in transition, share the main features of the demographic future. Low
fertility is expected to persist, population ageing will continue with
accelerating pace in the next decades. These trends will require some
considerable societal adaptations and reform regarding work, family life
and social protection.

Below-replacement fertility is widespread throughout Europe and several
countries are experiencing fertility levels that are extremely low. As a
consequence long-term generational replacement is no longer guaranteed
and the combined effect of increased longevity and decreased fertility
is resulting in fast population ageing. The mainstream policy discourse,
at the European and national level is strongly focused on adaptation of
social security systems in view of offsetting the negative consequences
of population ageing. However, adaptation to the consequences may not be
sufficient, especially in the long-term, and the cluster of determinants
of population ageing associated with low fertility will also need to be
addressed in comprehensive population-friendly policies.

The life course paradigm characteristic of the last decades of the
20^th^ century has largely been shaped by the capital-intensive economic
growth policies. The state intervention in social protection through
re-distribution of income policies was largely limited to buffering
risks inherent to the economic model of the monetarist regimes.

The key population challenge of the 21^st^ century is associated with
the economy of time. The way people spend time on daily activities,
spread activities during their life course, and manage risks associated
with family dynamics, maternity, labour force participation, retirement
and old-age over their entire life span, will largely affect the quality
of life of individuals, intergenerational solidarity, social cohesion in
general, and trans-generational continuity.

**The European demography of 2020**

Most demographic phenomena evolve at the pace of a generational time
span and, in modern culture, usually also change at a gradual pace: the
number of people that will form the elderly population section in 2020
is already born and has, in the absence of major catastrophic events, a
high probability of reaching that stage of life. Also the number of
people who will constitute the labour force in 2020 are born or are
already part of the active population. The number of children to be born
in 2020 depends partly on the number of women born at the end of the
former century and partly on their timing and intensity of
reproduction, - the latter being a phenomenon that, in absence of social
or other catastrophes, changes only slowly over time. The only
demographic phenomenon that might evolve at a faster and more sudden
pace is immigration, because this depends largely of policy decisions.
But also this determinant of the demographics of 2020 is subject to the
inertia of present political and social constellations and cannot,
consequently, be supposed to undergo fundamental changes, e.g. in the
direction of allowing massive, uncontrolled or non-selective
immigration.

The time perspective of the Global Trends 2020, consequently, is very
short to allow drafting significantly distinct, alternative population
scenarios which, moreover, are supposed to be reasonably plausible.

**The European social and policy context**

The design of alternative plausible demographic scenarios has to take
into account the "*acquis communautaire*" of the European social model
with its strong and diversified social protection system. Current
fertility differentials in Europe, more particularly between North and
South are generally considered to be linked to the degree of development
of social protection, gender equality and child- and family friendly
societal structures and climate. Fresh in mind is also the steep
fertility decline in the Eastern European countries after the breakdown
of the social protection systems in those countries around the time of
the transition to neo-liberal market economy.[^1]

Policy makers in Europe are quite well aware of the societal challenges
resulting from the current and expected population dejuvenation and
population greying.[^2] The large majority of Europeans also disapprove
of the expected trends with respect to population decline and population
ageing, as appears from the current wave of the Population Policy
Acceptance Surveys in 13 Eastern and Western European countries.[^3]

According to expert opinion, the societal challenges with respect to
population dejuvenation and population greying, will require quite
fundamental and long-term socio-economic, socio-ecological and
socio-cultural changes.[^4] However, Europe is characterised, within as
well as between its societies, by a salient ideological pluralism in
attitudes and views with respect to several crucial family and
population issues. A coherent and integrated view on a present-day
population-related policy is needed in the mainstream policy debates
both at European and national levels.

Moreover, the demographic challenges of modern societies will require,
in addition to indispensable short-term adaptive policies, long-term
policy strategies to modify the current demographic regimes. A
fundamental difficulty in reconciling immediate and long-term policy
effects reside in the fact that short-term adaptive policies more or
less correspond to the political time schedule of elections in
democratic countries, while long-term strategies require transcending
this temporal dimension and including intergenerational dimension of
population-friendly policies.

As far as concerns attitudes and expectations at the population level,
the present combination of dominant cultural values with respect to
quality of life, social protection and social rights acquisitions and
expectations, and the increasing labour insecurity as a consequence of
the increasing international economic competition related to a runaway
globalisation, reinforces the individualisation and short-term vision
trends that hamper the introduction and acceptance of more fundamental
and long-term envisioned policy changes.

The political and social inertia towards population-related policy
changes requires the designing of alternative population-related
policies, some of which could gradually be introduced and implemented in
the coming years.

**Plausible alternative population-related policy scenarios**

The demographic challenges of modern societies -- population
dejuvenation and population greying -- can be addressed by three types
of population-related policies: fertility-related policies,
longevity-related policies and migration-related policies. Each one can
be conceived and implemented in a single-dimensional scenario or
together in a multidimensional scenario. However, it is necessary to be
aware of the fact that only a comprehensive and long-term designed
policy scenario in which all three of the basic demographic determinants
-- fertility, longevity and migration -- are being dealt with, can
address effectively the major demographic challenges of population
dejuvenation and population greying and their multiple societal
consequences. Whereas some aspects of an immigration-focused policy or
of a population greying-related policy can be expected to have
relatively short-term results, most of the fertility-focused policy
measures can only be expected to have effects over a longer-term period,
i.e. beyond 2020.

***Population-related policies with respect to fertility***

This policy option is based on the hypothesis that it is desirable to
redress fertility at or around replacement level, and more in particular
that Europe ('s policy makers) would want to deal with the more
fundamental causes of the currently expected demographic trends in the
domain of population dejuvenation.

This option will require a comprehensive and multifaceted policy effort
in domains such as gender relations, family and child relations,
environmental design, child and family values, and life course
organisation. It can only produce results on a longer-term time scale.
Although it cannot be expected that the implementation of this option
leads to significant results by the year 2020, it could be initiated and
gradually developed in the coming years.

[Gender equality and emancipatory policies]{.underline}

Eliminating existing inequities with respect to gender, not only taking
into consider­ation that women still have a higher parental in­vestment in
children than men, but also because modern society is still largely
designed to suit men, is of primary importance. Policies in this field
may not only have to be of a structural nature, mainly to facilitate the
combina­tion of mother­hood with other activities, in particular
partici­pation in the labour force, but also deal with the existing male
mentality towards gender related task divisions with respect to child
caring and rearing, so that men can fully share family responsibili­ties
with their partners. Gender equality in the domain of family-work
relations might be favoured by a generalised reduction of working time.

[Family and child-friendly policies]{.underline}

There is a necessity to further eliminate existing parent-linked
financial inequities. Children are not only to be seen as an individual
gratifica­tion to their parent(s), but also as important for societal
life and con­tinuity. Inequities with respect to parenthood not only
concern the cost of children (including the opportunity costs), but also
the costs of care, protection, and insurance of the adults.

[Creation of a more child-friendly environment]{.underline}

The organisation and functioning of modern society is in many respects
child-unfriendly. In many urban environments more care and place is
given to cars than to playgrounds and safe paths for children.
Considerable work has to be done in creating a child-friendly town and
country planning. Also much stronger childminding facilities should be
provided in all kinds of social contexts -- work, leisure, gatherings,
etc., so that it appears clearly that children are welcome and are a
constituent in our societies.

[Promoting child and family oriented values]{.underline}

If all of the above-mentioned measures might contribute to eliminate
inequities and, consequently, help people to have the number of children
they want without having to be deprived of the privileges and advan­tages
adults without dependent children can enjoy, they may, but will not
necessarily increase the desired number of children to such an extent
that long-term generational replace­ment at the population level is
guaran­teed. Indeed, in most countries, the frequen­cy distribu­tion of
desired family size does not ensure long-term population replace­ment.
Low fertility might, consequently, also require the valuation of
be­havioural variation in reproduction. In the absence of substantial and
continuous im­migration flows, long-term generational replace­ment can
only be guaranteed when quite a large number of women surpass the one or
two child family size, in order to compensate for those who cannot or do
not want to have children or who have only one child.

[Rethinking the life course perspective of work, parenthood and
retirement]{.underline}

The current toolbox of family-friendly measures might, in the end, prove
to be insufficient to resolve the dilemmas facing individual women and
men with respect to genuine gender equity, on the one hand, and on the
other hand, dilemmas of modern societies with respect to
intergenerational continuity and redistribution of resources between
generations. Public policies have so far rather badly managed the
economy of time of individuals and families in a life-long perspective.

To reconcile the peak years of family formation with competition in the
labour market, the entire life course perspective of employment and
retirement might have to be rethought so as to give more free time and
resources to young families and to create conditions for active ageing
that entails also the option of working at higher ages long after
children have gained autonomy.[^5]

***Policy options with respect to longevity***

This policy option is based on the hypothesis that it is desirable to
deal with population greying.

It also includes several domains of policy action: activating the older
adults, adapting the social protection system, and reinforcing
intergenerational solidarity.

[Active ageing]{.underline}

Contrary to the biological ageing process which resulted in a
lengthening of life and opportunities to prolong an active life up to a
much higher age than ever before in human history, social ageing
developed in an opposite direction, with more and more people, retiring
at ever younger ages, either because society excluded them from the
labour force, or because people, being unsatisfied with their work
conditions, took advantage of the early retirement schemes.

The unfavourable effects of population ageing (increasing elderly
dependency ratio) can be counteracted by promoting an active ageing
policy, keeping older, able workers much longer, though in a variable
and flexible way, in the work force. Early pension schemes should,
consequently, be reduced and legal and de facto age of retirement
gradually increased. These measures should, obviously, be integrated in
a redesigned work pattern for all age groups in an comprehensive
work/family-friendly/social and retirement policy context.[^6]

[Adapting the social protection system]{.underline}

The social protection system -- pension system, health care and other
public funded care -- will have to be adapted to keep it sustainable in
a long-term perspective. The traditional pension systems in Europe
should be reformed and adapted to the new demographic regime. They
should be neutral, fair, and robust with respect to the further expected
increase of longevity. Pension reforms should be part of an integrated
policy together with population policies and welfare and labour market
reforms.

Each isolated specific adaptive measure to population ageing on itself
-- pension system reforms, changing labour participation, activating
older people, increasing immigration, redressing fertility -- will help
but will not resolve the problem. An integrated, multi-sectorial policy,
involving all of those measures, will be needed to address adequately
the long-term challenge of population ageing.

[Intergenerational solidarity]{.underline}

Although most measures will have to be of an organizational or financial
nature and pertain to specific problems, population ageing might also
necessitate be­havioural changes, and more particularly require the
strength­ening of inter­generational solidarity with a view to maintaining
or redressing inter­genera­tional equity in life oppor­tunities and
options.

***Policy options with respect to migration***

This policy options is based on the hypothesis that immigration is a
desirable instrument to compensate perceived deficiencies in population
size and age structure in Europe.

However, contrary to what is often believed, mass immigration is not a
solution to demographic ageing, because the average age of immigrants is
only a little lower than that of natives and the initially higher
fertility of immigrants soon decreases to lower levels. Immigrants
themselves age and both natives and immigrants need ever more immigrants
to compensate for the population ageing and to replace them (Avramov and
Cliquet, 2004).

Mass immigration can help to reduce the decrease in the size of
particular age groups and of the population as a whole, but it raises
many other societal questions. The costs and benefits of migration need
to be assessed in a comprehensive way and in a longer-term perspective,
and not just by taking into account current demand for particular labour
and its immediate benefits. The total cost of the integration process,
including education, health and housing needs of immigrants and their
descendants, the net effects on social cohesion, security and stability,
particularly in view of relations between the autochthones and
allochthones has to be considered.

[Selective immigration]{.underline}

Therefore, immigration must be selective and numerically adjusted to the
specific labour needs and reception capacity of the host country.
Complex modern societies cannot cope, without provoking or experiencing
serious social strive and disorder, with indiscriminate or mass
immigration. Immigration needs to be sustainable for the receiving
country, and must contribute to the society's welfare, security,
stability and cohesion.

Compensating for both population size and age structure deficiencies
requires a basket of measures of which migration might be one of the
minor components. Possible shortages on the labour market should first
be addressed by valuing, mobilising and integrating the existing
reserves of manpower of native as well of foreign origin, the latter
often being confronted with higher than national average rates of
unemployment, instead of enabling enterprises to recruit labour at no
cost for themselves but shifting the cost to the society at times of
economic restructuring of firms.

[Immigrant integration]{.underline}

Immigrants, more particularly of ethnic distant origin, need active
integration policies to avoid creation of ethnically stratified
societies. People migrate in order to improve their living conditions
and their quality of life. Inadequate integration, especially of second
and third generation migrants, as can be seen in several European
countries, can result in ghetto formation, limited opportunities to
upward social mobility or full participation in all aspects of social
life in the host country.

Integration of migrants implies also the acceptance by the national
population of the cultural identity and values of the immigrants as far
as they are not against the law or in conflict with fundamental European
values concerning individual development, educational opportunity,
gender equality, human dignity, democracy and individual's place in
society in general.

[Illegal migration]{.underline}

The potential for immigration from developing countries is so huge,
given the demographic, economic and political disbalances in many
developing countries, that Europe cannot absorb but a small fraction of
the existing and expected migration pressures. Illegal immigration must,
consequently, be adequately controlled.

**Conclusion**

The time interval up to 2020 is too short to realize plausible
alternative population scenarios for Europe. This time perspective and
the existence of the strong infrastructure of the advanced welfare
regimes and the high value Europeans attach to social protection systems
lead us to argue that the feasible scenario is of adaptation rather than
radical reform. The demographic challenges in the domains of population
dejuvenation and population greying in Europe require the design and
implementation of adequate, long-term population-related policies.

Population-related policy scenarios have been identified in the domains
of fertility, longevity and migration. They can be implemented either in
single-dimensional scenarios or in one comprehensive multidimensional
scenario. It is argued that only the latter can adequately address the
long-term challenges in the domains of population dejuvenation and
population greying.

An alternative scenario, not entirely impossible but highly undesirable,
would entail the dismantlement of the existing systems of
old-age/survivors' pensions, sickness, health care and disability,
family/children, unemployment, housing and social inclusion policies,
measures and services. The price of which would be, in the European
conceptualisation of development, huge in terms of social cohesion and
demography.

**Selected bibliography**

Avramov, D. (2003), *People, Demography and Social Exclusion.*
Population Studies No 37. Strasbourg: Council of Europe Publishing.

Avramov, D., M. Maskova (2003), *Active Ageing in Europe*. Population
Studies No 41. Strasbourg: Council of Europe.

Avramov, D., R. Cliquet (2003), Economy of Time and Population Policy:
Rethinking the 20^th^ Century Life Course Paradigm in the Light of
Below-replacement Fertility. *Zeitschrift für Bevölkerungswissenschaft,*
28, 2-4, 905-938.

Avramov, D., R. Cliquet (2004), *Critical Population Issues in Europe:
Implications for Integrated Policies on Gender Relations, Migration and
Ageing. Results of the Network on Integrated European Population Studies
(NIEPS).* Centrum voor Bevolkings- en Gezinsstudies: CBGS Publicaties.
Leuven: Garant.

Avramov, D., R. Cliquet (in preparation), *Population Policy Acceptance
Survey in Europe: A Comparative Analysis.*

CBGS (2003), *Network for Integrated European Population Studies
(NIEPS). Final Report.* Contract n: HPSE-CT-1999-00005. Brussels:
Centrum voor Bevolkings- en Gezinsstudies.

Cliquet, R. (2004), *Population Trends and their Sensibility to Policy
Measures.* Committee on Migration, Refugees and Population,
Parliamentary Assembly, Council of Europe. Strasbourg: Council of
Europe.

Council of Europe (2003) *Recent Demographic Developments in Europe
2001.* Strasbourg: Council of Europe Press.

Demeny, P. (2003), Population Policy Dilemmas in Europe at the Dawn of
the Twenty-first Century*. Population and Development Review,* 29, 1:
1-28.

Golini, A. (1999), Population Ageing in Developed Countries: Lesson
Learnt and to Be Learnt. In: R. Cliquet, M. Nizamuddin (Eds.),
*Population Ageing. Challenges for Policies and Programmes in Developed
and Developing Countries.* CBGS and UNFPA. Leuven: Ceuterick: 49-84.

Lutz, W., B.C. O'Neill, S. Scherbov (2003), Europe's Population at a
Turning Point. *Science*, 299, 5615: 1991-1992.

McDonald, P., *2000: Gender Equity, Social Institutions, and the Future
of Fertility. Journal of Population Research, 17, 1: 1-16.*

Philipov, D., J. Dorbritz (2003), *Demographic Consequences of Economic
Transition in Countries of Central and Eastern Europe.* Population
Studies No 39. Strasbourg: Council of Europe Publishing.

Pinnelli, A., H.J. Hoffmann-Nowotny, B. Fux (2001), *Fertility and New
Types of Households and Family Formation in Europe.* Population Studies
No 35. Strasbourg: Council of Europe Publishing.

Prinz, C., W. Lutz (1993) Alternative Demographic Scenarios for 20 Large
Member States of the Council of Europe, 1990-2050. In: R. Cliquet (Ed.),
*The Future of Europe's Population.* Population Studies No 26.
Strasbourg: Council of Europe Press: 85-106.

Roussel, L. (1989) *La famille incertaine.* Paris: Jacob.

Sardon, J.P. (2002), La conjoncture démographique: L'Europe et les pays
développés d'outre-mer. *Population,* 57, 1 : 123-170.

United Nations (2000), *Replacement Migration: Is it a Solution to
Declining and Ageing Populations?* New York: United Nations.

United Nations (2001)*, World Population Prospects. The 2000 Revision.
Volume II: Sex and Age Distribution of the World Population.* New York:
United Nations.

[^1]: Avramov, 2003; Philipof and Dorbritz, 2003

[^2]: e.g. Cliquet, 2004

[^3]: Avramov and Cliquet, forthcoming

[^4]: CBGS, 2003; Avramov and Cliquet, 2004

[^5]: Avramov and Cliquet, 2003

[^6]: Avramov and Maskova, 2003