Italians are emigrating in record numbers while live births last year dropped to their lowest level this century, according to the country’s national statistics office.
The worsening demographics will add to the pressure on the eurozone’s third-largest economy, which is mired in sluggish growth and troubled finances.
The national statistics office said on Thursday the population shrank by 90,000 last year, the fourth consecutive annual decline, to an estimated 60.4m.
Live births dropped to 449,000, some 128,000 fewer than in 2008, the lowest this century, the statistics office said.
About 160,000 Italians moved abroad in 2018, the biggest number since 1981 and 3 per cent more than the previous year.
“If these brains and hands . . . do not come back or are not replaced by other brains and hands, the economy will run out of gas,” said Andrea Garnero, economist at the OECD.
The number leaving is likely to be even higher than official statistics report, because Italians who register as emigrants lose healthcare and other rights.
“Some 2m young Italians — most of them skilled and educated — have left the country since 2008, effectively voting with their feet. For a country already plagued by exceptionally poor demographics, the economy can ill-afford this loss of human capital,” said Nicola Nobile, economist at Oxford Economics.
Since 2015, when Italy’s population was at its peak, the number of people aged 65 and over has increased by 560,000, while the working age population has fallen by about the same figure and is now the lowest on record.
Nearly 23 per cent of the population is now aged 65 or older, the highest level on record and the world’s second-highest after Japan. More than 14,000 Italians are aged over 100.
Italy’s ageing population is adding to the pressure on spending, with pension costs as a share of GDP the second-highest among 37 OECD countries, after Greece. Nonetheless, in January, Italy’s populist government approved a cut in the retirement age for some workers, raising concern over the country’s high public debt.
The IMF warned on Wednesday that Italy’s “public debt is likely to remain at its current high level for the next three years, after which it is projected to rise”.
The country fell into its third recession in a decade at the end of last year and output is 5 per cent below 2008 levels, nationals statistics office data show.
“Italy’s disappointing growth is rooted primarily in demographics and institutional rigidities,” Erik F. Nielsen, economist at UniCredit, wrote in a note.
The demographics data also showed that the number of Italians returning from abroad increased by 12 per cent in 2018 to about 47,000.
Fiscal incentives for returnees introduced in the past decade may have helped the trend, economists say. They include a four-year tax-free period on 90 per cent of earnings for university professors and researchers.
But concerns remain, with emigrants continuing to outnumber returnees and the overall population shrinking and ageing.
“The sluggish population dynamics, with the working age population set to decrease over the next few decades and the relatively low [economic] participation rate, are clearly a negative factor to the potential output of the Italian economy, which we estimate growing only at around 0.5 per cent over the next decade” said Mr Nobile.
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