The demographic crisis will hit the Italian GDP. The survey promoted by the Italian Banking Association, presented by the president of the Strategic Technical Committee of ABI, Gianni Franco Papa, described how a smaller working-age population implies a reduction in growth potential.
The report “Demographic evolution and banking services” concludes with a call for targeted interventions on some of those key factors that can significantly reduce the negative impact of demographic dynamics on economic growth.
The General Director of ABI, Marco Elio Rottigni, speaks of an ongoing structural change and it is in this context that we must, he continues, support families and businesses, neither by hindering cultural change, nor by accentuating it with the absence of measures to support the birth rate. The risk is of a decline in GDP of 18% by 2050 and more than 30% by 2080.
Falling GDP: up to -30% in the long term
The demographic crisis, given by the contraction in births, can be quantified in numbers for the Italian economy. ABI analyzed the phenomenon through a quantitative exercise to estimate the impact of demographic dynamics on economic growth until 2080.
According to Istat forecasts, the Italian population will decrease by over 13 million people by 2080, going from the current 59 million to around 45.8 million inhabitants.
At the same time, the average age of the population will increase:
- 31% will be over 67;
- the working-age population will fall to 58.2% in 2050 and 57.3% in 2080.
In concrete terms:
today 100 people of working age support 49 young and old people, in 2050 100 people will support almost 72 and in 2080 around 75.
In the absence of interventions, according to ABI estimates, the demographic crisis alone will lead to a reduction in GDP of 18% by 2050 and 30% by 2080.
What are the solutions: young people and women
The invitation, at the end of the survey, is once again to leverage interventions capable of reversing the trend of youth and female employment. There is also talk of the share of employed graduates who remain in the area and of an optimization of regular migratory flows.
By strengthening these aspects, in the long term we could compensate for the negative impact of the demographic decline on growth even without affecting individual choices to have no children or more than two children to overcome the “replacement threshold”.
The intervention of ABI
Gianni Franco Papa, president of the Strategic Technical Committee of ABI and CEO of BPER, declared:
The demographic transition is an issue to be managed strategically and according to a system logic. The decline in births, aging and the transformation of the population structure present us with significant economic, social and cultural challenges, with profound impacts also on the labor market, as well as increasing needs and new fragilities, but also opportunities.
How to do it? The approach in this case is that of health protection, pension planning that arises from the early working stages of the youngest and support for the generational transition and youth and female entrepreneurship. In all of this, also due to the technical focus of the investigation, the bank is placed as a central point of reference, or as an entity capable of offering solutions and qualified consultancy.
He continues:
We feel a strong responsibility to be part of the solution, identifying the priority areas to which to direct resources, with investments to support innovation, productivity and longevity services.
The General Director of ABI, Marco Elio Rottigni, also underlined the banking world’s willingness to collaborate with the institutions to define measures to promote the development and sustainability of the country.
They are needed, he continues:
targeted interventions on those key factors that can reduce the negative impact of demographic dynamics on economic growth.
