A] Prelude
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https://expatpensionholland.nl/europe-expat-pensions
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https://expatpensionholland.nl/global-investments-risks-0
https://expatpensionholland.nl/global-social-security-coverage
B] The Numbers
Europe’s rapidly aging population is hiking the old-age dependency ratio, a metric that indicates the pressure on the sustainability of retirement benefits. In countries like Italy and Greece, there will be fewer than two working-age individuals supporting each retiree by 2050, putting immense strain on pension systems and healthcare infrastructure.
Italy’s dependency ratio is expected to hit 66.5 percent by 2050, and Greece’s 68.1 percent, both well above the EU average of 56.7 percent, according to data from the European Commission. Some European countries are responding by raising the retirement age. In Spain, where recent polls suggest that over 40 percent of people fear the collapse of their pension system, the retirement age is being gradually raised from 65 to 67 by 2027.
Austria is taking similar steps, working to close the gap between the effective and normal retirement ages, and to limit early retirement options. Eurostat statistics show that while the demographic challenge is common across the continent, its severity, and countries’ responses differ significantly.
C] Regional differences
Northern Europe is generally better prepared. Sweden, with a 78 percent employment rate among those aged 55-64, benefits from policies supporting flexible retirement and lifelong learning. Finland, which expects 29 percent of its population to be 65 or older by 2060, has also introduced proactive healthcare and pension reforms to ease the financial strain.
Southern Europe faces tougher challenges. Italy, home to one of the world’s oldest populations, will see 30 percent of its citizens aged 65 or older by 2050. Spain and Greece can feel similar pressures, as ageing populations strain their already stretched pension and healthcare systems.
In Western Europe, the economic powerhouses Germany and France are adopting incremental reforms. Germany is on track to raise its retirement age to 67 by 2031 while investing heavily in healthcare technology and workforce training for older adults. France also introduced a controversial pension reform in 2023, raising the retirement age from 62 to 64.
Eastern European countries such as Poland and Croatia are facing additional challenges due to lower incomes and less developed healthcare systems. In a recent interview with Xinhua, Kresimir Sever, president of Croatia’s Economic and Social Council, highlighted the urgent need for more resources to handle the growing demands for care for the elderly, and social support systems.
D] Opportunities in silver economy
Despite these challenges, Europe’s aging population also presents significant economic opportunities, particularly in the form of the silver economy. The sector focusing on goods and services for older adults is projected to contribute 6.4 trillion euros (7 trillion U.S. dollars) to the EU’s GDP by 2025, supporting nearly 88 million jobs, according to a study by the consultancy firms Technopolis Group and Oxford Economics.
Industries like healthcare, technology, and leisure for aged people are thriving as businesses adjust to meet their needs. Data Bridge Market Research has forecast that the healthcare market alone will grow at an annual rate of 6.8 percent, reaching 577 billion dollars by 2031. Telemedicine, smart home technologies, and eldercare services are driving this expansion.
The tourism industry is also capitalizing on the demographic shift. Travel agencies like TourRadar headquartered in Vienna offer senior-friendly vacation packages, featuring accessible accommodations, medical support, and curated experiences for older travelers. Beyond the silver economy, the broader concept — the longevity economy — is gaining traction.
In a recent blog, Dubravka Suica, vice president of the European Commission for Democracy and Demography, emphasized that the longevity economy should leverage the potential of older adults not only as consumers but as active contributors to society. It stressed the elders’ social and economic roles beyond just their purchasing power.
E] Policies for aging Europe
The EU has long recognized the imperative to adapt to demographic changes. Over a decade ago, it introduced the Active Ageing Initiative and complementary policy tools, encouraging older adults to stay engaged in society. As a result, between 2004 and 2019, the share of workers aged 55 and older in the EU grew from 12 percent to 20 percent. At the national level, EU member states are crafting their respective policies to support active aging.
Slovakia recently launched an “Enhancing Digital Skills of Seniors” project, with a budget of 41 million euros. “New technologies contribute to slowing down aging, improving cognitive functions, and strengthening memory,” said Slovak Minister of Investments, Regional Development and Informatization Richard Rasi.
In addition to re-training older adults, some countries are focusing on urban planning to provide greater convenience for seniors. Lithuania is incorporating senior-friendly infrastructure into its cities, while Austria is improving accessibility in housing and transportation, offering subsidized public housing and barrier-free public transport facilities.
Meanwhile, experts are calling for stronger, forward-thinking policies to meet the needs of an aging population. Kresimir Sever suggested that governments should increase investment, expand nursing home availability, and improve care for the elderly to ensure that older adults can live with dignity.