BUSINESS

Greece’s demographic time bomb is about to go off

ROULA SALOUROU

Young Greeks comprise the ever-shrinking bottom of a population chart which should resemble a pyramid but in fact looks more like a short, fat mushroom, while the top, made up of pensioners, keeps getting bigger, threatening the collapse of the entire structure, experts warn, saying that the effects on pension and social security systems may be irreversible unless steps are taken now.

According to New York-based nonprofit organization HelpAge International, in 2030, one in three Greeks will be aged over 60, with the rate growing proportionately through 2050. Greece has one of the world’s most rapidly aging populations, together with Japan, South Korea, Italy, Spain and Portugal, and by 2050 it is estimated that the number of over-60s will have risen to 40.8 percent of the population.
HelpAge’s data on the quality of life of elderly Greeks, meanwhile, are worrying as the country has been found to be one of the worst places for the elderly to live, ranking in 79th place among 96 nations, behind Venezuela and South Africa. What is interesting is that Greece ranked quite high in specific areas of the study, such as income security (28th place) and healthcare (22nd). The low ranking, according to the HelpAge data, comes from its poor performance in other indices, such as how secure elderly people feel about the future and whether they are being usefully employed.

In terms of potential, Greece ranked in 87th place, as just 35.6 percent of people aged 55 to 64 are employed and only 31.3 percent of the over-60s have completed secondary or higher education. The social environment puts Greece in 91st spot, with 48 percent of citizens over 50 saying they feel safe to walk alone in their town or city.
However, in the areas that Greece appeared to do quite well, such as income security and healthcare, it is expected that its performance will deteriorate rapidly in the coming years as a result of the long-term effects of the crisis.

According to Byron Kotzamanis, a professor at the University of Thessaly and director of the Laboratory of Demographic and Social Analysis (LDSA), significant deteriorations are expected in the healthcare system and the income levels of most Greeks in the next few years, which will have a dramatic effect on quality of life and life expectancy.

Data from HelpAge suggest that average life expectancy for Greeks after the age of 60 is 24 years, but they will only enjoy 17.4 of those years in good health, slightly below the European average. As far as average incomes for those over 60 are concerned, this is higher than other countries in the region but ranks poorly when broken down. Gross national income per capita for the over-60s is low at $26,215 (23,525 euros), while the percentage of people above the age of 65 receiving a pension is below the European average at 77.4 percent.

Deaths & births

Major changes are also expected in the makeup of the Greek population, with experts estimating that in 2025 deaths will outnumber births, 22 percent of Greeks will be over the age of 65, and 15 percent of the 65+ group will consist of people above 85 years old. The first signs of deterioration in the overall health of the population as a result of the crisis will start becoming visible the next decade, the experts warn, with Kotzamanis adding that the population of Greece, last counted in 2011 at just under 11 million, will shrink by 300,000 to 400,000 in the next 10 years, due to deaths and emigration.

Births per woman born between 1975 and 1990 will likely be limited to 1.4 children, he adds.

Population aging is one of the biggest challenges that lie ahead for Greece, according to the European Commission’s 2015 Aging Report. It estimated that the Greek population will shrink by 2.5 million people to reach 8.6 million by 2060, while in France, for example, the population is expected to grow to 75.7 million in 2060 compared to 65.7 million in 2013.

A separate study conducted by Greece’s Alpha Bank also argues that low birthrates will contribute to the reduction in the population, saying these will come to 1.58 children per women in 2060, compared to a eurozone average of 1.72. As far as the age makeup of the population is concerned, the Alpha Bank study foresees the 65+ age group constituting 33 percent of the population in 2060 compared with 20.3 percent in 2013, while the 0-14 age group is seen shrinking to 12.9 percent in 2060 from 14.6 percent in 2013.
The 2015 Aging Report goes on to warn that the number of people aged over 65 compared to those in the economically active age group of 15 to 64 years will grow gradually from 31 percent in 2013 to 42 percent in 2030 and then to an unmanageable 61 percent in 2060.

In 2060, six in 10 people in the working population will be above 65 years old, compared with three in 10 today. Those aged 55-64 will constitute 78 percent of the economically active population compared to 42.4 percent last year.
For children born in 2000, this means that by the time they reach 50, they will have to pay much higher taxes and social security contributions to support the older generation, which will put an incredible strain on the system, particularly since the economically active age group of 15-64 is expected to drop to 4.6 million in 2060 compared to 7.3 million in 2013.

The aging of the population will also lead to people staying in the job market longer, the study found. In 2013 just 4.9 percent of the Greek work force was aged 65-75 and this will shoot up to 14.3 percent in 2030 and 24.4 percent in 2060, by which time the average age of the work force will be 44 from 39 today. The age of retirement will reach 67.5 percent among men in 2060 from 61 years old in 2013, and among women, it will go up from 61.2 last year to 67.1 in 2060.

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