For Germany, Demography Is Doom

Germany’s economy dominates the EU, but if demography is destiny–and it is–then, Ambrose Evans-Pritchard argues in the Telegraph, Germany is doomed. I had not realized that the numbers are so grim:

Germany’s birth rate has collapsed to the lowest level in the world and its workforce will start plunging at a faster rate than Japan’s by the early 2020s, seriously threatening the long-term viability of Europe’s leading economy. …

The German government expects the population to shrink from 81m to 67m by 2060…

That is appalling.

…as depressed pockets of the former East Germany go into “decline spirals” where shops, doctors’ practices, and public transport start to shut down, causing yet more people to leave in a vicious circle.

This chart shows the problem visually. Demographically speaking, France is in much better condition than Germany, as is the U.K.:


Britain and France are in far better shape, with an average of 12.5 births per 1,000 in from 2008-2013. The IMF expects both countries to overtake Germany in total GDP by the middle of century and possibly even by 2040, implying a radical shift in the European balance of power.

Having children reflects faith in the future and a belief that life is worthwhile. When people are hopeless or cynical, they tend to stop having children. We are all familiar with the phrase “voting with one’s feet;” having, or not having, children could be described as another sort of voting. And demographic decline is hard, if not impossible, to reverse, as people who don’t exist can’t reproduce.

This chart is surprising. It is credited to the International Monetary Fund, and reflects a prediction that real per capita GDP (and hence income) will fall in the decades to come, steeply in Germany and Japan and less steeply in the U.S. and the U.K.:


Per capita GDP depends largely, of course, on how many capitas there are. That, in turn, depends largely on rates of immigration. It would be interesting to know what the IMF assumed in that regard.

In any event, it seems clear that the European order is destined for a shake-up, as Germany can’t continue its leading role without producing more Germans.