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The solution to this crisis? More sex!

A controversial title I know, but one that summarises well the conversation I was having with one senior European banker about the crisis we have today.

He turned to me and said: “the problem with Europe and many other economies is a lack of growth and this is not the crisis today, but the one that has been building for a long time”.

“Oh”, says I, “what problem is that?”

“The lack of workers and the massive increase in pensioners”, he replied.

Now I’ve heard this debate for a while.  In fact I used to run workshops on our world and the shrinking population syndrome.

The essence of the debate went as follows:  Europe has around 500 million citizens but, due to families having an average 1.6 children, this is shrinking rapidly.  You need 2.1 children per family or more for a society to be sustainable.

Germany, for example, has 81 million people today, but will see that number shrink to 70 million by the end of the next decade.

Spain, historically a high reproduction rate, has sunk down the league tables so that, by 2050, Morocco will have 60% more people than Spain when, just sixty years ago, Spain’s population was three times that of Morocco.

The same discussion was posed about the UK and USA but has proven to be wrong, as both countries welcome immigration and immigration is a great way to top-up the workforce.

It’s certainly true in Britain, where most service jobs are now filled by Eastern Europeans for example.

Nevertheless, the point is valid that, unless something radical changes, Europe will see its population shrink.

This leads to the other issue: an ageing population.

It’s all well and good to have a shrinking population, as long as the proportion of workers stays at the same level to those not working or retired, with healthy ratios of around 4 workers to every non-worker.

The workers pay for the health, education, policing and more thanks to their tax donations, whilst the non-workers and pensioners suck up the tax bills in state pensions and benefits.

And there’s the rub: even with mass immigration, if the domestic population’s ratio is shifting to 3 or even 2 workers per retiree, there is an issue.


Cartoon by Ingram Pinn of the Financial Times

With forecasts of average lifespans for children born today of over a century, there’s the rub.

Originally, when retirement ages were discussed and pensions plans put in play in Germany towards the end of the 19th century, Bismarck had planned on most Germans being dead by the time they could claim benefits.

This was on the basis that the average age expectation for a man in the 1880s was 46, which is why the pension age was set at 65.

A century and half later, we still think we can become pensioners at 65 even though the average lifespan has increased to over 80 in most developed economies.

This is the core issue – the pensions time bomb – and it’s already hitting many societies across Western Europe today.

If you want to know more, just read the Europa report on demographic trends or checkout these charts from Eurostat:

EU population

But then my banking friend made another point: “the reason for the shrinking population workforce is because, as women are educated, they choose not to reproduce” and pointed to various studies that shows this to be the case.

In other words, as women gain choices through education, they decide not to couple with the male beast or have children quite as readily as when they are uneducated.

A key factor is that the more educated woman often has a career and independent life and can choose to have children later, although this can have an impact upon fertility as the older a woman chooses to have children the harder it can be to conceive. 

Equally, in societies where educational opportunities are limited, poverty, religion and coercion are often a higher factor in seeing women have more children at a younger age.

In fact, women in the poorest societies will often have as many children as possible, to ensure that one survives in areas of true poverty and war.  Think of Somalia, Sudan or other war-torn poverty areas and you get my drift.

The point of all of this is that children literally are our future and therefore the solution to the growth crisis caused by a shrinking, ageing population is: more sex.


About Chris M Skinner

Chris M Skinner
Chris Skinner is best known as an independent commentator on the financial markets through his blog, the Finanser.com, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal’s Financial News. To learn more click here...

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  • Greg

    I have six children. I can assure you it is not more sex that is required but less contraception and abortion. People have plenty of sex, the problem is that they disconnect sex from procreation.
    I am often the focal point of mocking jokes that my wife and I must be having sex more often than everyone else because we have six children. When in fact we have simply chosen a path that requires more mutual respect and self discipline.
    Separating sex from procreation and making it purely a leisure activity is like separating bonuses from the long term financial health of a company. It takes wisdom to see the result ahead of time.
    I recently went to my father’s 80th birthday party. His nine children have had over 60 children between them. No divorce.
    His old age is not a lonely one.

  • Chris Skinner

    Hey Greg
    Not sure, but are you Catholic?

  • Robert

    this is one of the most absurd argument I have seen in many years. What the Earth needs is firstly the stabilization of the population, then a managed decrease, to 1 or 2 billions humans. This is what is sustainable in the long term. otherwise, we will turn the earth into hell: pollution, exhaustion of resources, deforestation, species extinction, global warming (and there is nore). So Europe and all countries where population has stabilized or is decreasing are showing the way forward.

  • Greg

    How exactly would we achieve that managed decrease to 1/5 of the current population? Over what timescales? Malthus predicted we would already be dead. He was wrong. He did not fully understand or appreciate the impact of technical advance.
    What would you tell my children? They cannot have children, or, that they can only have children if some bureaucrat in Brussels decides they can?
    No major religions would recommend telling people they cannot have more children. They would fight that because in pretty much every creed multiplying is what God wants people to do. If there is not a God, then humans are no different to dinosaurs or any of other countless species that lived and died before us.
    If you tell me I cannot practice my faith, and take my basic human right to produce away, by force, then I might as well start reducing the population myself until I’ve settled the argument one way or the other.
    i.e. I will live free or die fighting.
    If you want to contracept yourself out of existence that is your right and I fully support it. Forcing that view on the rest of society is going to lead to one of us being dead. And I have nearly 100 close family members thanks to my father.
    If you do it through education and without force you will lose. The people who don’t buy your argument and continue to have larger families will take you over within a few generations.
    Simple Truism. The earth WILL belong to the breeders. Whether that is humans or Japanese knotweed.
    So ironically – your Malthusian view of the world is much more likely to result in your great grandaughter covered head to toe in a Burqua and having 10 children, than it is to produce your humanistic uptopia with everyone hugging dolphins and taking public transport.

  • Useful Link
  • “Taking the long term view, even without the intermediate layer of national governments, the socio-economical coherence of regional communities should be addressed. Automation of manual and mental tasks, productivity increased have started to become apparent after 1995 and are accelerating to such a degree that by 2025-2030 the fully automated part of the world economy will pass by the ‘normal’ economy in value. Add to that the fact that by 2020 the average cellphone has the same computing power as the human brain, advances in modular robotics, and self-learning artificial intelligence and mass-unemployment is a realistic future scenario. With the aging population and advances in medicine (regenerative medicine, cloning, turning of the ‘death genes’) and older people will only get older, and sometime around 2050, 2060 dying will be optional. Now that the babyboom generation is starting to retire, the impact is double. Every pensioner has a drop of income of some 30-40% which is enough to cover the basic expenses but makes it challenging to finance the extras. Their job position however is replaced by a junior, someone at the beginning of their career, who also doesn’t earn enough to finance the extras in life. Those extras are what make a rich country rich, and even if the pension has been funded correctly it is the impact of the spendable income that has governments worried and deliberately shortcutting a country’s pension system into forcing additional labor years isn’t going to fix that one. The most valuable solution ahead, is a base-income, and that is only viable when applying a dual currency model, with local money which can adjust itself via exchange rates, so that it maintains a consistent value in itself. Along with that the Euro can be maintained as a global currency just like Eurodollars used to.”

  • sss

    Umm…maybe the obvious solution is raise the age of retirement as lifespan increases…