Europe’s Rural Collapse? New EU Report Reveals Stark Demographic Forecasts for 2040

Apr 11 2025 By Evelyne Hoffman Social and Cultural Values Economy 0 Comments

The European Union is approaching a demographic tipping point so a new report shows. While urban regions are poised to continue growing, rural and intermediate areas are facing a population decline that could critically transform the continent’s socio-economic fabric, and even ignite a rural collapse. The warning signs of a rural collapse are becoming increasingly evident.

The new 2025 report from the European Commission’s Joint Research Centre (JRC) – “Outlook and demographic perspectives for EU’s rural regions: A modelling-based exercise” – exposes the depth of the rural demographic shift through a comprehensive modelling-based study. The research, which uses the integrated DELi (Demography-Economy-Land use interaction) model, projects changes out to 2040, offering policymakers a granular view at the NUTS3 level.

In this article we will break down the report’s key insights, from the accelerating depopulation of rural areas to the growing economic gap between regions. It highlights where the EU is losing ground, where convergence is still possible, and what strategies could help rural Europe stay economically viable.

And we will definitely see if there will indeed be rural collapse.

Urban vs Rural: The Population Gap Widens

The DELi model – which stands for Demography-Economy-Land use interaction model – forecasts that from 2023 to 2040, the overall EU population will decline by 0.04% annually. However, this figure hides vast disparities across regional typologies. Urban areas will continue growing, albeit at a slower pace, while rural regions, especially those remote from city centers, will see sharp declines.

Region Type	Population Growth (DELi, 2023–2040)	Eurostat Projection
Urban	+0.18% per year	+0.16%
Intermediate	–0.11% per year	–0.10%
Rural (Close to a city)	–0.35% per year	–0.33%
Rural (Remote)	–0.46% per year	–0.37%

Remote rural regions are especially vulnerable. These are defined as areas where less than half of residents can reach a city of 50,000+ people within 45 minutes. The projected -0.46% annual decline will erode local workforces, weaken tax bases, and reduce demand for services, setting off a spiral of decline.

By contrast, urban regions will continue to attract young workers and families thanks to stronger economies and better access to services. This growing urban-rural divide is expected to transform not only migration patterns but also long-term regional competitiveness.

Why the DELi Model Matters

Traditional projections treat demographics and economics as separate. The DELi model links them, showing how GDP, migration, fertility, and ageing interact.

For instance:

• Higher regional GDP attracts migrants, especially those aged 20–35.
• Population density reduces in-migration for older groups, who prefer lower congestion.
• Employment shifts impact land use, housing, and infrastructure planning.

This approach provides more realistic projections than models based on uniform assumptions across all regions.

What’s Driving this Rural Decline?

Natural Change: A Universal Decline

The EU’s natural change rate (births minus deaths) has been on a downward slope for decades. Urban areas maintained positive natural change until 2019. Since then, all regional typologies have registered more deaths than births, with rural and intermediate zones entering negative territory much earlier.

This means that even in the absence of migration, the population would decline purely due to demographic ageing. Fertility rates remain well below replacement level, while life expectancy increases. Rural regions have suffered disproportionately, as younger residents leave and older populations dominate.

Migration: Cities Still Win

Migration is the only force offsetting natural decline in urban areas. Historically, urban centers have enjoyed consistently positive net migration. Even during the pandemic, although migration flows dropped, cities rebounded quickly. By 2022, net migration into urban areas reached its highest point since 2000.

Intermediate and rural areas, particularly remote ones, lag behind. These zones occasionally experience positive net migration, but it is not sufficient to reverse population loss. Migrants tend to be younger and economically motivated, favoring cities with higher GDP per capita and job density.

The DELi model integrates these push-pull factors, showing how economic disparities and population density shape migration flows across different age cohorts. For example, people aged 20–35 are highly responsive to regional GDP differences, while older age groups are less mobile and more affected by local living conditions.

Ageing: A Silent Reshaper of Regions

Ageing is not just a demographic story; it’s an economic one. The JRC report shows two key indicators:

• Old Age Dependency Ratio (OADR): The ratio of those 65+ to the working-age population (20–64).
• Working Age Population Share (WAP): The percentage of the population between 20 and 64.

Region	OADR 2000	OADR 2023	OADR 2040
Urban	25.3%	32.3%	48.6%
Intermediate	26.7%	35.7%	54.3%
Rural (Close)	27.4%	35.9%	55.9%
Rural (Remote)	29.9%	41.1%	61.0%

Remote rural areas face the sharpest increases, with nearly two-thirds of their population projected to be dependent on a shrinking working-age base by 2040. That demographic imbalance has massive implications for healthcare, pensions, housing, and local economies.

At the same time, the share of people in working age is falling across the board. Even in urban areas, the workforce is shrinking, but they maintain an edge thanks to higher migration and better retention of younger populations.

The Economic Ripple Effect

Depopulation and ageing are economic earthquakes in slow motion. The report shows that GDP per capita is projected to grow across all regions, but rural regions close to cities will outpace others in relative terms.

This reflects a convergence effect, where proximity to economic hubs allows non-urban areas to benefit from spillovers. However, in absolute terms, cities will continue to dominate economic output. The divergence in total GDP will widen, even if income per person rises elsewhere.

Public finances will come under pressure in rural regions. Fewer taxpayers, more pensioners, and declining service demand will undermine budgets and threaten infrastructure maintenance. Economic development strategies need to shift from attracting growth to managing contraction intelligently.

Employment: Rural Economies Are Changing

Between 2000 and 2022, rural labour markets have transformed:

• Agriculture jobs fell sharply in all rural areas, especially those close to cities.
• Construction, transport, and retail grew, helping diversify rural economies.
• Public services and healthcare also gained importance, tied to ageing populations.

Sector	Change in Remote Rural (2000-2022)
Agriculture	–8.7%
Construction	+0.4%
Trade, Transport, Accommodation	+3.6%
Public Services, Health, Education	+3.4%

Rural regions are becoming less agricultural and more service-oriented, but this shift requires sustained investment and policy attention.

Which Countries Are Hit The Hardest?

The demographic forecast shows that not all EU countries are equally affected. Rural depopulation and ageing are especially pronounced in:

• Latvia and Lithuania: These Baltic states face some of the steepest projected population losses. Rural regions could see annual declines close to –1%, driven by persistent emigration and ageing.
• Bulgaria and Romania: These countries already suffer from high rural out-migration. The DELi model forecasts continued shrinkage, especially in remote areas far from major cities.
• Eastern Poland, Slovakia, and Hungary: Rural districts in these countries are projected to experience strong outflows of working-age individuals and rapid ageing.
• Southern Italy, Portugal, and Greece: While their urban centres remain relatively stable, peripheral rural areas continue to lose population and services, deepening regional disparities.

In contrast, countries like Ireland, Sweden, Luxembourg, and Cyprus are projected to grow in population overall, thanks to higher migration rates and relatively younger populations – though even these countries will face ageing in rural areas.

This geographic imbalance increases the pressure for a coordinated EU policy response that supports vulnerable regions while recognising national differences in capacity and needs.

Remote Rural Regions: Left Behind or Labs for the Future?

Remote rural zones are projected to shrink fastest, yet they may offer strategic advantages:

• Low congestion and scenic value attract retirees or remote workers.
• Older populations hold capital and experience for community-led development.
• Early adaptation to ageing can position these areas as innovation labs for healthcare, mobility, and decentralised service delivery.

However, these regions need targeted support. Without digital connectivity, public transport, and health infrastructure, they risk irreversible decline.

Policy Response: Adapt or Expect a Rural Collapse

The report dismisses the idea that declining rural populations can be reversed easily. Boosting fertility is politically sensitive, slow, and often ineffective. Relying on migration may provoke resistance or exceed integration capacities.

Instead, adaptation is the only viable route:

• Invest in health and social care, especially mobile and digital solutions.
• Support rural entrepreneurship, particularly among older citizens.
• Cluster public services regionally to keep access viable.
• Promote proximity-based development in rural areas near cities.

The EU’s long-term vision for rural areas must evolve from growth-based models to resilience-focused frameworks.

When Do We Speak of a Rural Collapse?

A rural region enters collapse when demographic decline triggers a self-reinforcing cycle of social, economic, and infrastructural decay. This typically includes:

1. Persistent and Accelerating Depopulation

• Population declines faster than –0.5% per year over a sustained period.
• Natural change (births minus deaths) is persistently negative.
• Net migration cannot compensate for demographic loss.

Example: Remote rural areas in Latvia and Eastern Bulgaria facing close to –1% annual decline.

2. Severe Ageing and Dependency Imbalance

• Old Age Dependency Ratios (OADR) exceed 60%, with very few young adults remaining.
• The working-age population share drops below 55%, limiting labor supply and innovation.

3. Collapse of Public Services and Infrastructure

• Schools and clinics close due to low demand.
• Transport, postal services, and banking are withdrawn, isolating residents.
• Access to broadband and mobile networks remains poor or is deteriorating.

4. Economic Hollowing Out

• Agricultural viability weakens due to lack of labor and capital.
• Service industries shrink or disappear entirely.
• Investment dries up, and unemployment rises.

5. Loss of Social Cohesion

• Community institutions vanish (libraries, associations, markets).
• Younger generations no longer return or invest.
• Remaining residents feel politically and socially abandoned.

When does a Rural Collapse Become Irreversible

A rural collapse becomes near-irreversible when a region:

• Loses the critical mass needed to sustain a local economy.
• Lacks policy support, digital infrastructure, or proximity to growth poles.
• Reaches a point where restoring services becomes more expensive than relocating people.

And this is also the warning embedded in the JRC report: Remote rural regions in several EU countries are already approaching this threshold. Without targeted, place-based intervention, they risk becoming “demographic deserts” – inhabited, but functionally disconnected from the rest of society.

Europe’s Rural Regions are Diverging

Europe’s rural regions are not just shrinking; they’re diverging. Remote areas face deepening demographic and economic stress, while rural zones near cities show potential for adaptation and convergence.

The JRC report’s granular forecasts, powered by the DELi model, offer a rare opportunity to preempt crisis with informed strategies. Policymakers now have the data to act.

The question is: will they adapt fast enough to stop rural Europe from becoming a demographic wasteland?