Germany’s aging baby boomer generation threatening country’s prosperity
Berlin: As Germany’s baby boomer generation retires, the country will be threatened with losses amounting to billions of euros, according to a study published by the German Economic Institute (IW).
Baby boomer is a term used to describe a person who was born between 1946 and 1964. The baby boomer generation makes up a substantial portion of the world’s population, especially in developed nations.
In the next 15 years, Germany’s economy will “change drastically” with baby boomers no longer working, and the labour market will lose more than 5 million workers, Xinhua news agency reported citing the study as saying.
Assuming that policies continue largely unchanged, real income per capita in Germany will only increase by an average of around one percent per year until 2035, according to the study.
“Policymakers must act now,” IW stressed in the report.
Day care for children in schools and other facilities in Germany must be improved so that more parents can work full-time instead of part-time, and immigration could also help address a shortage of skilled labour.
Better conditions for private investment, improving public infrastructure, and good market access opportunities for innovative companies would also be required to counter the generational effect, the study found.
“The future federal government is called upon to react to the shrinking population, only then can companies also do their homework,” said IW Director Michael Huether.
“Business as usual destroys prosperity for all and cannot be in the interest of politics.”