Europe is experiencing significant demographic changes that profoundly impact daily life. This requires a comprehensive and integrated approach to finding solutions to its challenges. In June 2023, the European Council’s conclusions urged the Commission to develop a toolbox to assist Member States in addressing demographic issues and their impact on Europe’s competitive edge.
The Commission has adopted a Communication that presents a set of policy tools available to Member States for managing demographic change and its impacts on the EU’s society and economy, including its global competitiveness. The Communication outlines the wide range of tools available to Member States, including regulatory instruments, policy frameworks, and funding to empower and support everyone to benefit from the opportunities and challenges of demographic change.
The Commission supports Member States with various legal, policy, and financial instruments to manage demographic change. In today’s Communication, the key reforms and investments required to maintain the EU’s competitive edge are identified using all possible combined instruments.
Decisive and concerted EU action to manage demographic change
The Demography Toolbox provides a comprehensive approach to demographic change, drawing on experiences from across the EU. It is structured around four pillars:
1) Supporting parents by better reconciling family aspirations and paid work. This can be achieved by ensuring access to quality childcare and promoting work-life balance.
2) Supporting and empowering younger generations to thrive, develop their skills, and facilitate their access to the labour market and affordable housing.
3) Empowering older generations and sustaining their welfare through the appropriate labour market, workplace policies, and relevant reforms.
4) Addressing labour shortages through managed legal migration, where necessary, in complete complementarity, harnessing talents from within the EU.
The toolbox also recognises the importance of considering the territorial dimension of demographic shifts, particularly in regions that experience population decline and significant outward mobility of young workers (known as “brain drain”).
Implementing the demography toolbox
Demographic change is a pressing issue that is reshaping our economies and societies. According to a Eurobarometer survey on demography published today, 7 out of 10 Europeans agree that demographic trends put the EU’s long-term economic prosperity and competitiveness at risk. The most significant demographic challenges faced are population ageing (42%) and the shrinking of the working-age population, leading to labour shortages (40%).
To tackle this issue, the demography toolbox can spur, fine-tune, and better coordinate policies at the EU and national levels. The Commission calls on all Member States to develop and implement integrated policies that tackle demographic change and mainstream demographic concerns into all policy areas. Policies should be grounded in local realities, as demographic challenges differ across Member States and regions.
Gender equality, non-discrimination, and intergenerational fairness must be at the heart of policy choices. Policy-makers should promote citizens’ active participation in this effort and involve all players, including social partners, civil society organisations, and others. Digital technologies can boost Europe’s competitive edge and help offset the impacts of demographic change.
In addition to regulatory instruments and policy frameworks, several financing instruments are available at the EU level to support Member States, such as the Recovery and Resilience Facility and the European Social Fund+ (ESF+).
To enhance the available tools to tackle demographic challenges, the Commission will reinforce the data and evidence base, notably by further developing the Atlas of Demography, supporting Member States in enhancing their population and housing statistics and supporting relevant analytical activities and research. The development and upgrading of demography-related policies at all levels will also be supported, notably by using the Technical Support Instrument and mainstreaming demographic concerns in relevant policy proposals at the EU level.
Moreover, the Commission will ensure that every region in the EU is included by officially launching the Harnessing Talent Platform on 23-24 November 2023 and proceeding with further calls under the Talent Booster Mechanism.
It is crucial to take concerted and decisive action on demographic challenges; otherwise, the EU population may continue to shrink and age, harming the EU’s economy, society, and long-term competitiveness. If demographic trends continue, they may exacerbate labour shortages and increase pressure on public budgets while profoundly impacting investments and productivity. Some Member States and regions are currently more affected than others: demographic change affects the social, territorial, and intergenerational cohesion of our democratic societies, potentially worsening existing socio-economic rifts to the detriment of everyone.
