We Need More Migrants – Austria

Experts in Austria have warned that there are too few children and migrants.

The problem will get much more serious from 2025. At which time warns pension expert Mr. Christoph Krischanitz it will be too late if measures are not set now by the existing government. As early as 2020, the demographically induced strain on the working population will start to increase. As it is already, in about 15 years time, 80 Austrians (babies, pensioners and all those who are too young for a job) will have to be financed by about a hundred workers between the ages of 18 and 65 years.

Mortality

The actual number of deaths in Austria is lower than previous forecasts have estimated. “Basically, it is of course gratifying that we are living longer, but that is already a funding problem before 2025”, say the experts.

Births

The number of births is gradually increasing, with the peak likely to be reached in 2023. Then the birth rate will start to fall again. To equal the current system, Austria would need 110,000-120,000 births per year, estimates Mr. Krischanitz. Currently, hardly 80,000 children are born every year.

Skilled migration advocated

Migration

This is not also the solution to the problem, because “Austria has too little immigration.” The “net migration” (difference between migrants and those leaving Austria) shows reduction as we approach 2015.

“The government would be well advised to focus on dealing with the situation foreseen between 2020-2035” according to Mr. Krischanitz and advises on “turning several screws in the system, increasing birth rates and advocating skilled immigration”. Both which are certainly easier said than done. This is because the number of women with childbearing potential is decreasing and with regards to migration Austria has to compete with other European countries.

For the long-term, motivating families directly with cash benefits is the wrong strategy. Instead, he argues for the development of infrastructure, “we have far too few childcare places and too little, and some poorly trained staff for it”.

The expert recommends also, to increase earlier than planned by law the retirement age for women. As set currently, from 2024 women will have to work to the age of 65.

Mr. Krischanitz advocates also for stronger backing of private and occupation related pension systems over the state funded scheme. Here a lot (actively directly funded by the pensioners) will be saved in contrast to the state capital allocation process. Today, 90 percent of all pension benefits come from Social Security, 75 percent and 25 percent of Social Security funding “would smooth the increase in the dependency ratio”.