Lessons for countries with aging populations

Posted on August 14, 2013  /  0 Comments

One may argue that demographic trends have little to do with what we at LIRNEasia do. I disagree. Especially when we are talking about knowledge work, service industries and infrastructure, demography is the place to start from. From the colloquium given by Professor Indralal de Silva several years ago, we’ve been fully engaged with these issues. The story on how Germany is failing to respond to the demographic crisis has lessons for all, especially countries that are getting old before becoming rich.

Germany, however, an island of prosperity, is spending heavily to find ways out of the doom-and-gloom predictions, and it would seem ideally placed to show the Continent the way. So far, though, even while spending $265 billion a year on family subsidies, Germany has proved only how hard it can be. That is in part because the solution lies in remaking values, customs and attitudes in a country that has a troubled history with accepting immigrants and where working women with children are still tagged with the label “raven mothers,” implying neglectfulness.

If Germany is to avoid a major labor shortage, experts say, it will have to find ways to keep older workers in their jobs, after decades of pushing them toward early retirement, and it will have to attract immigrants and make them feel welcome enough to make a life here. It will also need to get more women into the work force while at the same time encouraging them to have more children, a difficult change for a country that has long glorified stay-at-home mothers.

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