Bankitalia: risk of 9% less labour force in 2040

In 2040 there could be about 5.4 million fewer people between the ages of 15 and 64, i.e. of working age, while the labour force could drop by 9 per cent with the risk that GDP would fall by the same percentage. The alarm comes from the head of the labour market division of the Bank of Italy, Elena Viviano, who during a conference at the Rimini Meeting explained that between 2019 and 2023, people in this age group decreased by 600,000. Employment, however, has grown in recent years thanks to increased labour market participation, especially of women. This is what we must focus on in the near future, reducing the wide gap that Italy has with Europe.

"In 2040 there will be 5.4 million fewer people of working age," he explained, "according to ISTAT figures, these are impressive numbers. Our production system will face a significant drop in potential workers. The issue of companies' difficulties in recruiting labour will stay with us for a long time. The reduction of the working age population is not automatically a reduction of workers because we have to look at the market participation rate. If current trends continue we could find ourselves in 2040 with 9% less labour force. This threatens the country's potential growth. In the long run, all other things being equal, 9% less labour force translates into 9% less GDP. This is not a scenario we can afford'.

Viviano emphasises that other conditions must be changed, labour productivity and market participation must be addressed. But we need to address the issue of education (the share of Italian university graduates between the ages of 25 and 49 is still significantly below the EU average) and services because women's labour market participation is correlated with the presence of childcare and care services in general. Bringing Italian women's employment to the EU level in the next 10 years, according to the economist, could halve the loss of 9 per cent of the labour force.

The fundamental challenge is the Mezzogiorno while artificial intelligence hovers over everything, which according to Bankitalia will affect seven million workers, one third of the total. The challenge is being taken up by the government, which with the Minister of Labour, Elvira Calderone, has reiterated its commitment to maintaining aid for parenthood but above all to increasing labour market participation. According to the minister, work must be done to raise the employment rate, currently at 62 per cent, to its highest level ever, at 68 per cent.