Who will work in an ageing Europe?

Europe is the continent with the oldest population in the world. In almost all European countries, women have on average fewer than two children, but for a stable population about 2.1 children per woman would be needed. At the same time, people are living longer and longer thanks to better medicine and better living conditions. As a result, the number of pensioners is growing, while the number of people of working age is falling.

This change puts great pressure on pension systems. In most European countries, today's employees pay the pensions with their contributions. If the number of employees falls, states must either increase contributions or raise the retirement age. Germany, for example, is gradually raising this limit to 67. At the same time, older people need more medicines, hospital treatment and care. That is why health costs are rising precisely at a time when fewer and fewer people pay taxes and contributions.

The labour shortage is already visible in many sectors. In hospitals and care homes there is a shortage of nurses and carers, and on building sites and in workshops there are not enough craftsmen. In Germany, many companies can no longer fill vacancies, especially in rural areas. Economists warn that the problem will become even bigger when the large generations born in the 1960s retire in the coming years.

In response, Germany is trying to attract workers from abroad. With the Skilled Immigration Act, the country eased the conditions for workers from countries outside the European Union. Since 2016 the so-called Western Balkans regulation has allowed citizens of Albania, Bosnia and Herzegovina, Kosovo, North Macedonia, Montenegro and Serbia to work in Germany. For this they do not need a formal qualification, just an employment contract with a German employer. Since 2024 the annual quota has been 50,000 people.

But what is a solution for Germany is a serious problem for countries like North Macedonia. According to estimates, hundreds of thousands of citizens have already left the country, mostly young and well-educated people. When nurses and doctors leave, hospitals in Skopje, Bitola or Tetovo have fewer and fewer staff. So the country itself is ageing even faster, because precisely those who should finance future pensions are leaving. Can Europe solve the problem without weakening its neighbours?