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FIAP > Boletín – Otras Publicaciones > The 2021 Aging Report: Economic and Budgetary Projections for the EU Member States (2019-2070) – European Commission – May 2021
22 June, 2021

The 2021 Aging Report: Economic and Budgetary Projections for the EU Member States (2019-2070) – European Commission – May 2021

This report presents projections showing the long-term economic and budgetary impact of population aging.

Long-term demographic projections reveal that the EU will be “turning increasingly gray” in coming decades. The total EU population is projected not only to decline in the long term, but also to undergo a significant change in its age structure in the coming decades. According to Eurostat, the total population will decrease by 5% between 2019 (447 million) and 2070 (424 million). The working-age population (20-64) will decline even more sharply, from 265 million in 2019 to 217 million in 2070, reflecting fertility levels, life expectancy and the dynamics of the migratory flow.

Population aging will affect both men and women, with a significant increase in the average age. The projected population in 2070 is less than, or close to, the 2019 population in all age cohorts between 0 and 64 (up to 69 for women). In contrast, in all age cohorts from 65 and older (over 69 for women), the projected population in 2070 is higher than in 2019.

By 2070, the EU’s share of the total world population is projected to drop by 3.7%, from its current 5.7% (2020), and the portion of older people in its population will be the second highest worldwide, among large economies.

Without considering the impact of mortality and life expectancy due to COVID-19, the projected changes in the structure of the population reflect assumptions regarding fertility rates, life expectancy and migration flows. The total fertility rate is expected to increase from 1.52 in 2019 to 1.65 in 2070, for the EU as a whole. This trend stems from a supposed process of convergence between Member States in the very long term towards the country with the highest fertility rate (in 2019). In the EU, life expectancy at birth for men is expected to increase by 7.4 years during the projection period, from 78.7 in 2019 to 86.1 in 2070. For women, life expectancy at birth is projected to increase by 6.1 years, from 84.2 in 2019 to 90.3 in 2070, implying some convergence of life expectancy between men and women. The largest increases are projected for the Member States with the lowest life expectancies in 2019. Annual net migration flows to the EU are projected to decline from approximately 1.3 million people in 2019 to 1 million people in 2070, representing a decrease in contributions from 0.3% to 0.2% of the total population.

The demographic dependency ratio of older people (people aged 65 and over compared to those aged 20 to 64) in the EU is projected to increase by 24.7 percentage points over the projection period, from 34.4% in 2019 to 59.2% in 2070. This means that instead of having around 3 people of working age for every person over 65, the EU would only have less than 2 people of working age for every person over 65. Most of this increase is due to the dependency ratio of the very elderly (people aged 80 and over compared to those aged 20 to 64), which increases by 15.8 percentage points (from 9, 9% to 25.7%) in this horizon.

In the baseline scenario, the total cost of aging (including spending on pensions, healthcare, long-term care and education) is projected to increase in the long term at the aggregate level in the EU. The total cost of aging, which was 24% of GDP in 2019, is projected to increase by 1.9 points of GDP in the EU between now and 2070. In the Eurozone, it is forecast to increase 1.7 points over the same period (from 24.6% of GDP in 2019).

The peak of age-related spending as a percentage of GDP occurs in the middle of the projection horizon. For most countries, the highest value is reached before the end of the projection horizon. This temporary profile is mainly due to the projection of pension spending, which is expected to increase modestly throughout the projection period (significant increase in the first two decades, with a decline from the mid-2040s).

To review the full report, please download it here.

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