Gerontocracy in Motion? – European Cross-Country Evidence on the Labor Market Consequences of Population Ageing



Michael Fertig and Christoph M. Schmidt

Figure 2

Population Shares of Under 20 Year Olds in EU-15 Countries
1999; %

the second World War almost all other European countries experienced sub-
stantial net immigration. In recent years, this experience has been shared by
the Mediterranean countries as well. Overall, Europe as a whole underwent a
transition process from an emigration to an immigration region. In confirma-
tion of this assessment, Table 2 documents that many EU-countries currently
display a large stock of immigrants. A substantial fraction of this stock of im-
migrants comprises so-called second-generation migrants, i.e. the offspring of
immigrants born in the country of residence.

From Table 2 it becomes transparent that foreign (-born) individuals comprise
a substantial share of the population and the labor force especially in Austria,
Belgium, France, Germany and, unsurprisingly, Luxembourg. However, these
figures do not reveal the important and often neglected effect of immigration
on birth rates and, therefore, population growth during the last decades. Since
migrants are typically young, in their prime child-bearing age and display
higher fertility rates than the native population, these immigration move-
ments have also had a rejuvenating impact on the population of the destina-
tion country. Schmidt (2000c), for instance, estimates that population growth
rates in Germany would have been around 0.5 percentage points lower if there
were no immigration during the 1960s and 1970s. In consequence, it is very
likely that higher immigration rates in the future can indeed (moderately)
contribute to an alleviation of the demographic burden.



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