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The working-age population decreases by 101 thousand people after the pandemic
Written by SOT.COM.AL 9 Qershor 2023
The country's population has been on a downward trend for three decades, but the working-age population (15-64 years) is shrinking at a faster rate.
According to INSTAT data, on January 1, 2023, the country's general population decreased by 1.1% compared to 2022, while the working-age population decreased by 1.8%.
The working-age population was reduced by about 101 thousand people compared to 2019, before the pandemic. Currently the working age population is 1,864,062 people from 1,974,207 in 2019, or 101 thousand less.
The strongest decline can be seen in the 20-24 age group, with more than 17% since 2019. The decline in this age group reflects the high emigration of young people abroad. Furthermore, the population at the age of 15-19 has suffered a great decline, when in 2023 there are 35 thousand fewer people than in 2001.
The working-age population has decreased for all age groups up to 59 years old, except for 35-39 years old where there was an increase of 7.1% compared to January 1, 2022. Furthermore, it can be seen that only the workforce on the verge of retirement (60-64 years old ) has increased by 8.7%.
Population projections show that the working-age population will decline at a faster rate than the general population in almost all counties.
Tirana is the only county in which a significant increase in the potential labor force is predicted (by 20% until 2031, according to the normal scenario with geographic distribution and constant emigration within the country).
The strongest drop in the potential labor force is predicted for Gjirokastra (by -43%), as well as Berat and Dibra (by at least -30%).
Demographic experts claim that Albania is in the middle of the window of economic opportunity that extends approximately to the beginning of the 2020s.
The average age of the workforce is over 40 years old and if the right policies were applied, the country's economy would be at peak productivity from this opportunity. The workforce in Albania is at an age where experience and age are the ideal combination to produce maximum benefits.
The decrease in the working-age population has a positive effect on the decrease in unemployment (mechanically due to emigration), among other things, due to the fact that budget expenditures are reduced to pay the unemployed category.
However, at the same time that the budget for covering the social payment for the unemployed is reduced, as a result of the decrease in the number of unemployment from emigration, the income from taxation in the budget, which came for the same reason, from emigration, is also reduced.
In such a situation, very soon the country will lose its competitiveness in the region even for foreign investments. Currently, it is the free labor arm that has brought foreign companies to Albania. But during the next decade, even this possibility seems to be exhausted./Monitor