Most countries around the world and on every continent except Africa now have ageing populations. The problem of overpopulation has now been overtaken by another – demographic ageing. The pace of demographic ageing is accelerating, and there is also a continuing decline in birth rates.

Switzerland’s population, although ageing, is also growing, mostly as a result of migration. Fewer children are being born, and the birth rate is falling. There are now fewer young workers entering the labour market than older workers leaving it as they retire.

The factors involved in declining birth rates are both financial (housing costs and the high cost of living) and social, and social factors appear to be gaining in importance. People now attach greater value to personal fulfilment: their priorities are changing, and some are pessimistic about what the future holds. This limits the state’s ability to help increase birth rates: financial support for families is becoming less effective over time. In any case, the state’s influence on decisions by individuals – including starting a family – must remain limited in a free society.

Switzerland could further strengthen measures to help people more easily combine work with family responsibilities, without substantially increasing the size of the welfare state. Employers could provide more support for parents and parental care wherever possible. And the right combination of flexible working arrangements, in terms of both location and working hours, could help substantially to improve people’s ability to combine work with family responsibilities.

If migration is to help reduce the impact of demographic ageing, Switzerland needs access to migrants who are willing and able to work in its labour market, so its migration policy needs clarification. ‘Business as usual’ no longer fits the bill as pressure mounts on both supply (do enough foreign workers want to migrate to Switzerland?) and demand (does Switzerland want migration?).

The global ‘war for talent’ is set to intensify, with Switzerland being particularly affected. The country needs skilled labour, and most will come from countries that are themselves grappling with an ageing population. Around the globe, countries with high average levels of education and training are generally seeing their working age population decline, while countries with poorer levels of education and training are seeing their working age population grow.

Even targeted measures to support families have limited ability to respond to demographic ageing or prevent its (further) acceleration. However, the trend towards smaller families and higher incomes has been in evidence since the early days of industrialisation and now predominates in many countries and cultures around the world. There is no sign of this trend being reversed – quite the contrary, in fact.

Switzerland and Swiss companies must, therefore, adapt to demographic change and its multidimensional impact on the country and its economy.

• We identify six key areas for action, each of which will form the focus of an in-depth report in this series:
• Workforce dynamics
• Health and longevity
• Consumer behaviour and trends
• Pensions
• Sustainability
• Technology and automation

Companies see the biggest impact of an ageing population on pensions, the labour market, and technology and automation. The proportion of companies surveyed reporting a large or very large impact in these areas is 83%, 71% and 61% respectively.

These are also the areas in which companies identify the greatest mismatch between impact and preparedness – that is, where the need for action is greatest. Demographic ageing is already highly relevant to business: 40% of companies report that they are already affected by the impact of ageing, while a further 20% expect to be impacted over the next three years.