July 24, 2021

The Fiscal Authority estimates that between 7 and 10 million immigrants will arrive in Spain in the next 30 years | Economy

The Fiscal Authority estimates that between 7 and 10 million immigrants will arrive in Spain in the next 30 years | Economy



As of 1976, the fertility rate collapsed in Spain, suggesting that population growth would enter negative rates. However, that did not happen. Since the year 2000, immigration took off, and between 2001 and 2015 some 315,000 immigrants arrived a year. This phenomenon increased the labor force, delayed the demographic winter and contributed to the payment of pensions. However, with the crisis it has now slowed down. And that is one of the factors that makes the most recent projections quite negative. The National Institute of Statistics (INE) simply projects for the next few years what has happened in the last, and therefore points out that the population will stay stagnant in the 44 million in 2050. Eurostat also makes projections, although it shows something more optimistic: the population will grow to 49 million.

However, the Airef disagrees with these projections, which it does not consider appropriate and which show a kind of "Japaneseization of the Spanish economy", a particular country because it restricts the entry of immigrants. "They assume that what happened in 2013 and 2014 will be repeated in the future," sources from the Tax Authority point out. And things get worse when you look at the number of people of working age: the INE and Eurostat give a contraction in three decades of 7 million and 5 million, respectively.

So the Airef has prepared forecasts instead of projections. According to these sources, these calculations are "more plausible" and, in addition, will help the Fiscal Authority to better estimate the future evolution of Social Security accounts, a report that will be published before the end of the month.

On the one hand, the Airef expects the fertility rate to improve to 1.8-2 children per woman, a very substantial improvement compared to the 1.3 currently. In the opinion of the Fiscal Authority, the surveys indicate that Spaniards want to have more children. In addition, Spain offers few birth aids, policies that have proven effective and could be improved. And the low ratios have been closely linked to the labor market, argues the organization chaired by José Luis Escrivá. However, there is a criticism of this reasoning: the reduction in birth rates among Spaniards occurred strongly even in the good times, which could indicate that it may be very difficult to reach those 2 offspring per woman.

On the other hand, the Airef expects that, with migratory policies equal to the current ones, immigration will rise to around 250,000 people per year, somewhat below the 300,000 annual registered between 2001 and 2015 and well below the peak of almost 700,000 in a year , back in 2008. The fiscal body believes that Spain will continue to have a GDP per capita far higher than Latin America and Africa, which will encourage the continuation of immigrant flows from these continents. Now, the experts always put a but to this reasoning: it must maintain a rate of activity that allows to absorb those arrivals. That is, the economy will have to grow.

As for life expectancy, it could continue to increase. And all this will allow the number of inhabitants to increase between 4 and 13 million in the next 30 years, which would place the population between 51 and 60 million in 2050, well above the 44 million INE and 49 million of Eurostat.

Even so, the dependency rate will be between 45% and 60%. That would mean spending four people of working age per retiree compared to two in 2050. "This progressive aging of the population will put increasing pressure on public spending associated with aging," says the Airef note.

For example, the IMF has made calculations for pensions in which they draw an entry of 5.5 million foreigners, among other factors. And even so they predict that the pension will lose about a third of its purchasing power in relation to the average salary.

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