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News

NEWS

Demographic trends in Kazakhstan based on the results of 2023, long-term challenges and their impact on the pension system

According to the Bureau of National Statistics of the Agency for Strategic Planning and Reforms of the Republic of Kazakhstan, the population of the country as of January 1, 2024 was more than 20 million people. At the same time, the following breakdown by age group was observed: under 25 years old - 8.5 million people. (42.6%), from 25 to 65 years old - 9.7 million people. (48.5%), over 65 years old - 1.8 million people. (8.9%).

It is predicted that in Kazakhstan the population will reach 26.3 million people by the end of 2050.

· Life expectancy and proportion of elderly people  

Life expectancy (the average life expectancy that a person will live provided that the mortality rate of the population remains the same as in the year under review) after a decrease due to the pandemic (2020 - 2021) increased from 70.23 in 2021 to 75.09 years in 2023.

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

Population in whole

70.62

71.44

71.97

72.41

72.95

73.15

73.18

71.37

70.23

74.44

75.09

Men

65.91

66.90

67.49

67.99

68.72

68.84

68.82

67.09

66.33

70.26

70.99

Women

75.23

75.82

76.26

76.61

76.92

77.19

77.30

75.53

74.03

78.41

79.06

Forecasts from both the UAPF and the UN show that by 2050 there will be a high level of demographic old age due to increasing life expectancy (the proportion of people aged 60 years and older has increased from 9.7% in 2008 to 13.6% in 2023 and will continue to grow to 16.7% by 2050, that is, by 2050, on average, every sixth Kazakhstani will be 60 years of age or older).

Fact and forecast of the proportion of people aged 60 years and older


3.png

·   Total fertility rate 

One of the key factors influencing the structure of the population is the total fertility rate (TFR), which shows how many women on average would give birth to during the entire reproductive period (i.e., from 15 to 50 years).

Since 2022, there has been a decrease in this indicator from 3.05 to 2.96 in 2023. According to UN forecasts, the fertility rate in Kazakhstan is expected to further decrease to 2.42 children per woman by 2050

.

Year

2016

2017

2018

2019

2020

2021

2022

2023

TFR – children per a woman

2.77

2.73

2.84

2.90

3.13

3.32

3.05

2.96

The decline in fertility is a global trend for the whole world. In the context of a gradual decline in fertility rates and an increase in life expectancy, the demographic burden per 1 working-age person is increasing.

·   Migration balance

The UNFPA (United Nations Population Fund) office in Kazakhstan in the report Analysis of the Population Situation of the Republic of Kazakhstan predicts a gradual achievement of a migration balance of 0 per 1000 people by 2050, which is motivated by “the economic development of the republic, which is accompanied by high demand for labor, the gradual depletion potential for significant ethnic emigration, rapid population growth in countries south of Kazakhstan."

Below are the numbers of immigrants and emigrants for the years 2016–2023:

Below are the numbers of immigrants and emigrants for 2016–2023:

Year

2016

2017

2018

2019

2020

2021

2022

2023

Arrived

13,755

15,595

12,747

12,255

11,370

11,039

17,425

25,387

Departed

34,900

37,725

41,868

45,225

29,088

32,256

24,147

16,094

     As you can see, after the pandemic, the annual number of arrivals to Kazakhstan over the past two years has more than doubled, while the number of departures has decreased by 2 times since 2020.

·   Potential support ratio

There has been a decline in the potential support ratio, calculated as the number of people of working age (25 to 64 years old) divided by the number of people aged 65 years and older.

The ratio of people of working age (25-64 years) to pensioners (65+ years) decreased from 7.7 in 2012 to 5.49 in 2023. According to forecasts of both the UAPF and the UN, the potential support ratio in Kazakhstan will continue to decline to about 4.0 by 2050, which will increase the “burden” on the working-age population. 

Fact and forecast of potential support ratio

4.png

Current demographic trends and long-term challenges pose a serious challenge to society related to its pension provision. This problem is solved by the funded pension system, which is more resistant to demographic and economic development processes.

The funded pension system allows citizens to form their own pension savings during their working lives in proportion to their income. This helps reduce the burden on the state budget and increase pensions in the future by redistributing responsibility for pensions between the state, citizens and employers.

Thus, the development and strengthening of the funded component in the pension system is a key factor to ensure its sustainability and adaptation to demographic changes, comfortable living conditions for future generations of pensioners, and neutralization of financial risks. To achieve these goals, the Social Code of the Republic of Kazakhstan also provides for the phased introduction of 5% of employer’s compulsory pension contributions (ECPC) from 2024.


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