<B>Longer life, aging and immigration</B>

Rafael Puyol. Executive Vice President. Fundación Instituto de Empresa

1 January 2005

A changing population has made Spain concerned with demographic matters.

Spain’s population is not the same as it was only five years ago. Immigration is up and negative growth is down. These and other factors have inspired the nation with a different view of its future.

These changes, revealed partly in the 2001 census, led the National Statistics Institute to issue forecasts focused on 2070. The year is far off and representative of the doubt implied in the popular expression, cuán largo me lo fiáis, meaning an idea that is too distant in the future to be truly reliable.

Spain’s new view of its demographic future is troubled by fewer shadows than before. But population forecasts must be viewed with care. They are not perfect prediction devices, but rather simple calculations that describe the possible evolution of the effects and structure of a population based on hypotheses on birth rates, death rates and migration. Though subject to errors inherent in the hypotheses themselves, they are an instrument for knowing what will become of us, albeit merely, as Anatole France says, because the future is a convenient place for situating our dreams.

We are not dreaming when we predict that in the future there will be more of us. The reason is increased immigration. This is positive news in the world of scarcity in which we live and work. If events happen as we expect, by 2025 there will be over 50 million in Spain and in 2050 over 53 million. These dates represent our demographic zenith, because from then on, decline is unavoidable.

Longer life

Two seemingly contradictory phenomena concern the death rate. Life expectancy will increase for both sexes. The 83.3 years any woman born in 2002 could expect to live will reach almost 87 in 2030, and a man’s 76.6 years will stretch to 81. This is especially good news for men, who have always had a lower life expectancy and are now catching up. The bad news is that the gross figure of deaths resulting from the aging process will increase. By this I mean the accumulation of older people at the top of the age pyramid.

To compensate, we will have an increase in the birth rate, which already began five years ago. To measure this, we can use the average number of children per woman; i.e., the average number of offspring born to each, if at the different ages they adopted the behavior of fertility observed at the moment of the study. In 2002, the rate was 1.256, and in 2050 it will be 1.526. The rates, applied to women of childbearing age, resulted in 416,000 births for the first in 2002 and 432,000 for the second in 2050. The difference in the number of children born is not great, despite growth of the indicator, because the number of potential mothers to which it is applied will be lower.

The average age of motherhood improves, since today it is significantly high (30.82 years). It will rise to 31.14 years, thanks to younger motherhood in foreign women.

Immigration: the rising star

Immigration is expected to increase. Three demographic factors will direct the trends: additions to the local population; the influence producing an increase in birth figures; and mitigation (though not halting) of the aging process. These three effects combined will fuel our population rise. But beware! If hypotheses on birth and death rates contain uncertainties, those concerning foreign immigration are particularly risky. Consequently, the National Statistics Institute warns of the future of this variable with insistence and sets calculations for the short term only. Analyzing the previous trend, it considers that the 615,000 entries corresponding to the year 2000 will fall to 276,000 in 2009, and predicts a quarter of a million fixed arrivals from 2010.

Even when estimated, immigration has a starring role in our future growth. However, the star will gradually fade and emit little light. Today we are concerned about the heavy influx of immigrants wishing to live among us. Will the day come when we worry about having too few of them? I wouldn’t be surprised. It’s probable that if immigration does not increase, the population will drop from 2050, because it will be impossible to compensate natural negative growth - the result of intense aging - with the expected arrivals. The 53 million of 2050 will fall to 51 million by 2070.

More important than mere figures will be how we are distributed by age, because many aspects of our future economic and social life depend on this variable. It seems clear that there will be fewer young people, fewer adults and more older persons. Already in 2002 we had a smaller younger than an older population (16 percent to nearly 17 percent), with adults representing two-thirds of the total. In 2050 the younger set will fall to 14 percent and adults to 55 percent, while the ranks of the elderly will swell to 31 percent.

Aging will be unavoidable and irreversible. It will be good news, a challenge and a concern. Good news, because it is the expression of a social goal that has long been pursued. A challenge, since it is not only a question of furnishing life with more years, but of furnishing those years with more life. And a concern, for it will create problems about pensions and other social expenses.

These problems will have to be faced by a labor market with a different structure, fewer young people, and more adults, immigrants, women and older people who will be active for longer.

Not only the labor market will be different. Society will change, from an ethnic, cultural, religious and linguistic point of view. We will have to learn to manage diversity through policies that favor integration of immigrants. And without education for all - foreigners and locals - there will be no integration, no progress and no future. Finally, we are not ready to receive large numbers of foreign students in our schools - another problem that must be addressed if we are to avoid putting our coexistence at risk.

As you can see, the demographic future, as all futures, is exciting. Those who will live through it will judge our forecasts. They will also have the task of forecasting their own future. I hope it is no darker than ours.

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