​The NBR is concerned about the demographic changes we are witnessing and mentions them among “important structural vulnerabilities with serious implications for financial stability.”

In Hunedoara, the average age of the population increased by 2.6 years. But the oldest county remains Teleorman, where the average age is approaching 46 years, which is 8 years more than in Ilfov.

It is almost common sense among economists that the aging population in recent decades — as postwar baby boomers approach retirement and the birth rate among their children declines — has driven low interest rates.

“The question of aging is very emotional: who will take care of grandma?” George Magnus, chief economic adviser at UBS, asked a few years ago. Measures such as raising the retirement age, providing incentives for caregivers, or accepting more migrants can mitigate the effects of an aging population.

The youngest and oldest districts

The situation in the country looks like the graph:

Impact on growth

The aging of the population will affect the public finances of governments in most countries of the world, and rating agencies warn that this will put pressure on sovereign ratings, write Financial Times journalists.

According to Moody’s Investors Service, an aging workforce is putting pressure on states’ economic and fiscal strength, affecting their long-term sovereign credit profiles. Back in 2018, another global rating agency said in a report that the credit ratings of South Korea and Japan were under severe pressure due to “a combination of lower economic growth and higher public debt amid an aging workforce.” 2030 year.

The mechanism is simple. People save the most during their working lives when they have a job that allows them to put something away. Then, in retirement, they consume more than they save, and in their final months of life, they tend to consume more, especially on health care and medicine. Increasing life expectancy puts more pressure on the economic and social support of the elderly, especially as healthy life expectancy after 65 in Romania is one of the lowest in Europe.

We have a problem of generational solidarity

Since 1990, the number of workers has decreased compared to the number of people to support (young and old). “We have a problem of generational solidarity. The current cohorts of the elderly were, for the most part, at an advantage compared to the current active generations: they had relatively standardized biographies, were characterized by relatively easy access to education, health care, housing, and the labor market.

The younger generations had to face more important problems during their lifetime in building a good life, and their biographies were marked by many changes and problems in relations with the education system, the health care system, when they tried to solve their housing problem, and also during their working life , says in a discussion with HotNews.ro Iuliana Prekupetsu, research associate of the Research Institute of the University of Bucharest (ICUB), coordinator of the AMASE project “Multidimensional approach to social exclusion and consequences for the health status of the elderly”

Both the Romanian Academy and the INS estimates show that the active population in Romania will consistently decrease, as will the labor market participation rate.

The consequences of demographic changes on the labor market are pronounced. When there is a higher proportion of wage earners in the population, competition in the labor market increases, which reduces the bargaining power of wage earners and lowers both wages and inflation.

The demographic implications will mean that savings rates (the share of savings as a percentage of total income) may fall sharply as baby boomers retire. This can affect the price of money (interest rates) and prices in financial markets (its bonds). In short, get ready for legislatively extended working lives, higher taxes and further disintegration of the social fabric