Switzerland’s population is expected to grow by 150,000 by the end of 2024, but GDP per capita will fall by 0.4%. Experts warn that this decline in prosperity comes in a favourable economic context and raises concerns about the sustainability of growth.
We read in Le Matin that the Federal Statistical Office revealed that Switzerland will see its population increase by about 150,000 people by the end of 2024, to reach 8.96 million. This represents the highest population growth rate since the 1960s. However, despite the population expansion, per capita GDP fell by 0.4%, indicating a decline in average well-being. This decline comes at a time of economic growth, raising questions about the relationship between population growth and economic prosperity. Experts warn that urban sprawl and rising property prices are among the consequences of this growth, raising questions about the effectiveness of current economic policies.
According to data released by the Federal Statistical Office this week, Switzerland’s population will grow by around 150,000 people by 2024, to 8.96 million. This is the strongest population growth since the early 1960s. Part of this increase can be explained by the integration of refugees from Ukraine.
Since GDP rose by only 1.3% in the same period, this means that real GDP per capita fell by 0.4%, the SonntagsZeitung reported. “GDP per capita is the real indicator of prosperity,” explains Matthias Binswanger, professor of economics at the University of Applied Sciences in Northwestern Switzerland in Olten (SO). “If it falls, it simply means that the average well-being of people in Switzerland is also falling,” he says.
GDP per capita has indeed fallen in the past, but only in times of crisis or recession. This was the case during the oil crisis of the mid-1970s, the recessions of 1982 and the early 1990s, after the dot-com bubble burst, during the financial crisis of 2008, and during the 2020 pandemic. Today, global GDP is falling for the first time in a favorable economic period.
This leads to problems such as housing shortages, urban sprawl and pressure on population density. Furthermore, a study by the University of Freiburg concluded that about a fifth of the increase in property prices is due to the free movement of people. According to the study, every percentage point of immigration leads to a 7% increase in new rents.
There is no sign of a change in trend: In the first half of 2024, the influx of migrants remained high. Matthias Binswanger believes that Switzerland should ask itself whether it makes sense to pursue problematic growth without increasing prosperity. In particular, the professor questions the policy of promoting Switzerland as an economic location, which aims to attract companies to our country to create more jobs.
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