Europe is heading towards a sustained decline in population. In the coming years, most EU countries will experience demographic decline as a direct consequence of low fertility rates and an ageing population.
This is not a new phenomenon. Without immigration, Europe would already have started to lose population a decade ago. Spain's population has grown by 24% since 1990 thanks to an influx of foreign population and a favourable population pyramid [Fig. 1].
Fig. 1. Demographic components of population growth in Spain, 1990-2023 (%).
Source: Authors' own elaboration based on INE data.
However, Europe's demographic evolution will not be uniform. According to a recent study by the Joint Research Centre, countries in central and eastern Europe will experience a rapid population decline by 2050 due to low birth rates, unfavourable migration flows, and a demographic structure reflecting decades of decline. In southern Europe, population loss is almost exclusively explained by low fertility rates. As in Spain, in Portugal, Italy, Greece and Malta the population could shrink by around 10%. Conversely, countries such as France, Germany and the Netherlands could experience more modest population declines thanks to higher levels of immigration and more stable birth rates than in southern Europe.
It is well known that an ageing population and a reduction in the number of young people will affect the labour force and labour market dynamics in the future. According to Eurostat's baseline scenario, if labour participation rates by age and gender were to remain stable at current levels, Spain could see its labour force fall by up to 3 million people by 2050 (INE's projections suggest a more positive migration balance and therefore a much more contained fall). However, this future is not inevitable. The active population could shrink by a much smaller amount, or even stabilise if we manage to boost the employability of groups with low labour participation rates, such as women, over-55s, and young people with few qualifications.
The experience of other countries can serve as a roadmap. Currently, 82% of Swedish women aged 25–64 participate in the labour force, compared to 75% in Spain. If our country were to converge to this level of female participation, the negative effect of demographics on the labour force would be largely neutralised (desirable scenario I). A similar outcome would be achieved if the employment rate of people over 55 were to increase (desirable scenario II) [Fig. 2].
Fig. 2. Hypothetical labour force scenarios for Spain (million people).
Source: Authors’ own elaboration based on Eurostat and INE data.
The future of Europe's workforce will depend not only on the size of its population, but also on its ability to utilise the available talent. This requires investment in the employability of all socio-demographic groups, the promotion of regular and safe migration pathways, and the effective integration of foreign nationals into the labour market. In an ageing continent, creating more jobs with fewer people will be crucial for collective well-being.
For further information, please see: Andreev, Kirill et al. Demographic Components of Future Population Growth. New York: Population Division United Nations, Department of Economics and Social Affairs, 2013; Biagi, Federico et al. A Demographic Perspective on the Future of European Labour Force Participation. Luxembourg: Publications Office of the European Union, Joint Research Centre 141153, 2025; National Office of Foresight and Strategy (coord.). Spain 2050: Fundamentals and Proposals for a Long-Term Startegy. Madrid: Ministry of the Presidency, 2021; and, Ueffing, Philipp et al. The Role of Migration and Fertility for the Future Size of the EU’s Population. Luxembourg: Publications Office of the European Union, Joint Research Centre 141069, 2025.
[Fig. 1.] The top bar shows the percentage change in Spain's total population between 1990 and 2023. The sum of the individual contributions of the four demographic components shown in the lower bars equals the total change. These contributions indicate how the population size would have changed if there had been no change in the other components.
[Fig 2] To construct the baseline labour force scenario, the average activity rate for the period 2020–2024 was applied to the projected population structure for the period 2025–2050.
To construct the first desirable scenario, the same average activity rate was applied to all but two groups in the 2050 population structure: women aged 25–54 and 55–64. For these groups, an activity rate of 82% has been set as a target, which corresponds to the current Swedish female activity rate ('the Swedish way', according to the Joint Research Centre scenarios).
For the second desirable scenario, the average activity rate for 2020–2024 was applied to all but four groups in the 2050 population structure: men and women aged 55–64, and men and women aged 65–74. For the 55–64 age groups, a target activity rate of 77% has been set. For the 65–74 age group, a target of 16% has been set. These targets correspond to those set in Spain 2050 and the Country Compass.