Promoting Population Growth, Essay Example

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Words: 395

Essay

Certain countries in Europe such as Germany and Italy are facing a unique dilemma. While their birth rates are declining, their population is also aging due to progress in medical science. This means that while the burden on social services such as healthcare and pension will continue to increase, the funding for these programs will continue to decline due to fewer working age people.  But the governments of these countries can take few steps to ensure that the labor market continues to thrive and doesn’t fall short of labor supply that is required to support the national economy.

One solution is to encourage immigration, especially of educated and skilled immigrants. Such a policy will ensure that not only the nation is able to meet all of its labor needs but also enjoys higher average productivity and income levels. This will maintain or even improve quality of life standards and will also increase tax revenues for the government. A second policy option may be to introduce more favorable labor regulations that reflect the changing composition of the labor force and enable more people to balance work and family life, especially women. Favorable regulations could include requiring companies to offer flexitime (Farlex) to female employees, especially those with young children to more effectively balance work and family life. Policies such as these will encourage women to have children because having career would no longer mean foregoing children.

Some countries in Europe probably already provide financial incentives to women to have children while others could follow Iran’s example. Iran announced a policy in 2010 that it will pay money to the family of every new child and deposit money into the newborns’ bank accounts until they reach 18 (Free Republic, 2010). Many women avoid children due to the financial opportunity costs but policies such as these would help reduce the opportunity cost of pursuing a career at the cost of having children.

Countries can come up with many solutions by carefully analyzing the changing population demographics as well as opportunities presented by globalization. But the governments have to be willing to take bold steps because some effective solutions such as immigration are often controversial political issues.

References

Farlex. (n.d.). The Free Dictionary. Retrieved May 8, 2012, from http://www.thefreedictionary.com/flexitime

Free Republic. (2010, July 27). Iran’s Leader Introduces Plan to Encourage Population Growth (Wants Women to Have More Babies). Retrieved May 8, 2012, from http://www.freerepublic.com/focus/f-news/2560673/posts

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