Alexander Makukhin, Jan Lisniewski
Beata Jaworczyk, the Bank’s lead economist, notes that “the gray wave is changing the global economy.” “New technologies are promising, but they will not fully compensate for a shrinking labor force. Demographic pressures are strong, and their effects will have a serious impact on economic growth and living standards in the region if they are not addressed through prudent and proactive policies.”
Europe’s shrinking labor force, she said, can be offset by “raising the retirement age, increasing women’s participation in the labor market, migrants, innovation and technology.” But using these tools is “not an easy task” and has its consequences. “Raising the retirement age is politically unpopular, and migration at the level needed to compensate for demographic decline (would also) be politically controversial,” the banker notes.
EBRD analysts’ calculations suggest that between 2024 and 2050, demographic decline will have the effect of reducing GDP per capita growth by 0.36pc in the EU, Western Balkans, Eastern Europe and the Caucasus. To compensate for this decline, many countries will need annual net immigration to exceed 1% of their current total population through 2050.
But for Moldova, the primary problem is not aging, but out-migration. The report notes that emigration has played a central role in accelerating population decline in most post-communist countries. In particular, “Bosnia and Herzegovina, Georgia and Moldova have lost about 30 percent of their populations since 1990, almost entirely due to emigration.”
The director of Intellect Grup, sociologist Jan Lisnevski, notes that Moldova’s demographic problem has two main factors.
“First, a real culture of migration has been created in Moldova. Children are initially programmed with the idea that success is possible only abroad: if you study well, you will go to London. That is why already now about 60% of 12th graders intend to migrate after graduation, and another 20% are thinking about it. The figures are huge. Secondly, the problem of education. We don’t have a normal national program that promotes in a good way the real meaning of staying here. People draw all their heroes and examples for success abroad. You can criticize the Soviet Union all you want, but they knew what they were doing when they created national heroes out of policemen and doctors. It is difficult to do this in our country, when a school teacher often cannot even provide for himself,” the expert notes.
As for the birth rate, Lisnevsky notes that 47% of the republic’s population lives today or, banally speaking, is busy surviving.
“Under such conditions, creating a family is out of the question. Plus stressful environment – COVID, war in Ukraine, economic uncertainty. From 2020, 47% to 60% of the population is under constant stress. The response becomes either aggression or apathy. Hence the deterioration of the crime situation in the country, where the number of crimes is increasing by orders of magnitude and they are becoming more violent. There is also an atmosphere of injustice in the society due to corruption, especially at high levels. Seeing all this, a person will not want not only to start a family, he does not want anything at all…,” the expert notes.
At the same time, Lisneuski is not sure that Moldova, like other European countries, will be able to compensate for the lack of labor force by migrants from Asia.
“Simply because, in terms of price level in Chisinau we can compare with Switzerland. This is well seen in the example of Ukrainian refugees. Many of them tried to stay, to start working here, but had to leave because one winter in Moldova costs similarly to a year of living in Tuscany,” he said.
Doctor of Political Sciences, sociologist Alexander Macuhin notes in this regard that “Moldova’s migration policy – as a set of laws, specialized institutions, and, most importantly, conceptual framework – is only at the very initial level of its development”.
“It seems important to me that when forming a real concept of migration policy and attractiveness of Moldova, one could use the image of a small peaceful country, where there is no xenophobia, but there is a culture of connection of very different people and, for example, there is quite competitive education in a multitude of world languages at a relatively low cost of living,” the expert believes. – This is a good foundation. But for this, we need to recognize that “we need people”. The main problem here is primarily political, in recognizing the problem. Demography is not always destiny. For a small country, it is the ability to manage its human capital, to regulate migration policy, to increase the employment rate, which we have low, and to translate, for example, diaspora policy into the language of concrete numbers rather than emotions. As an example of two countries comparable to Moldova, which managed to transform themselves from their “demographic fate” – Ireland and Slovenia. In both cases, migration policy was part of the economy and politics there. But whether it is possible to do without migrants – today I would answer no, it is impossible. The problem is also that if everything continues in this form, and we attract only low-skilled workers as labor migrants for heavy physical or simply monotonous work that does not require any qualifications as such, then this is a dead end and a path to social tension.
In his opinion, “Moldova will undoubtedly not turn into a wasteland in the short term,” but the authorities will have to pay attention to a number of issues one way or another.
“The pension system is looking more and more like the elephant in the room that no one is talking about. Very painful reforms are needed here, and someone has to start them. It also seems to me important to change the public focus from calculations of ‘again fewer children were born this year than last year’, and to focus on increasing real female employment. And, of course, to formulate a migration policy towards all those who could come to Moldova and those who could return to Moldova (diaspora). But do not try to mix them – they are very different categories of people. Next, the issue of administrative and territorial reform is also related to demographic changes. The EBRD report indicates that rural regions are depopulating 11% faster, and Moldova is directly affected. Our system is outdated, but again, this is an issue that concerns political fears and compromises on the ground much more than demography”, says Alexandru Macuhin.
