Greece’s demographic time bomb and its threat to the economy
It is notable that the 30–44 age group is proportionally decreasing, while the number of workers over the age of 65 is on the rise.
Greece’s demographic crisis is reaching explosive proportions and poses a major threat to the country’s economic future, as reflected in a growing body of research and analysis.
Projections indicate that by 2050, people over the age of 65 will make up more than one-third of the population—up from 24% today. Without intervention, the country’s total population could shrink by 1.3 to 1.5 million, with the most significant losses occurring in the 20–64 age bracket—those of working age.
One striking trend is the shrinking share of people aged 30–44, while the number of workers over 65 continues to rise, according to the latest report from the Centre of Planning and Economic Research (KEPE). As highlighted in a special analysis by the Foundation for Economic and Industrial Research (IOBE), demographic decline and population aging are deeply interconnected and pose complex challenges to the sustainability of Greek society and its economy.
The sharp decline in birth rates—coupled with a rising average maternal age—is worsening the demographic imbalance. Natural population decrease is now recorded in every region of the country, underlining the urgent need for immediate and effective policy responses.
While net migration provides some buffer against population decline in certain areas, it is not sufficient to reverse the negative trend overall.
A Troubling Trend
The population aged 30–44 is shrinking faster than any other age group. KEPE’s data, covering up to Q3 2024, show a loss of 69,000 individuals in this age bracket within a year—22,700 of them in just one quarter. This is especially concerning, as this group is traditionally the most active in the labor market.
In terms of employment, 30–44-year-olds saw a drop of 37,700 in employment numbers—making them the only age group to record such a decline. Employment rose across all other age groups. In the private sector alone, this group posted just a 1% increase in employment, compared to 4% overall.
Meanwhile, three age groups saw growth. The over-65 population grew by more than 31,000 in a year, reflecting not only demographic aging but also longer working lives. The 15–19 age group also grew by 21,000 people.
The over-65 workforce saw the largest percentage increase—exceeding 11%—among all age groups. Overall, most people leaving the labor force became economically inactive, with 38,100 added to that category in one quarter. Some may have left the country altogether, KEPE notes.
Labor Market Warning Signs
“The biggest problem facing the Greek labor market—and the country as a whole—is the demographic issue,” warned KEPE President Panagiotis Liargovas in an interview with ERTnews. “This has two dimensions: declining population and aging. It’s an explosive combination for future growth.”
Citing KEPE’s labor market study, which shows a decline in employment among 30–44-year-olds, Liargovas added, “We see that employment is falling in the 30–40 group, while it’s increasing in other age groups.”
He attributes this to two main factors: an aging workforce, and the fact that this age group came of age during the financial crisis. Many emigrated abroad in what became known as the “brain drain.” While some have since returned, the number who left was so large that it continues to impact today’s labor market.
Source: OT- tovima
