WATCH: Natalie Carney explores Germany's population

Since the 1970s, Germany's population growth has been stagnant. That's according to Prof. Panu Poutvaara, Director of the IFO Center for International Institutional Comparisons and Migration Research in Munich.

But 2022 saw a sharp change in that trend.

"In one word, migration," Poutvaara told CGTN. "The population of Germany would have been decreasing without migration."

Official data shows the number of people living in the Bundesrepublik grew by 1.3 percent last year - to 84.4 million people, the largest population increase since reunification more than 30 years ago.

Around 2.6 million people moved to the country in 2022, while 1.2 million left - resulting in a net surplus of 1.4 million new residents, compared to the previous year.

Close to a million of those were people fleeing the conflict in Ukraine.

Between the end of February 2022 and December, 962,000 Ukrainians were added to the German population, according to the federal statistics office Destatis.

This is extremely helpful for the German economy, said Poutvaara. "Without the immigration, the German economy would be shrinking and there would be a major difficulty in finding people to work in hospitals, old age care, also private companies."

"To the extent that immigrants are employed they make a very valuable contribution to the sustainability (and) to public finances and pensions."

Since immigrants are typically younger than the population on average, they have a longer remaining working life, which is important for Germany's aging population. 

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As in previous years, the number of births in the country fell by around seven percent in 2022, providing fewer German born taxpayers to meet future pension demands.

To compensate for this, Germany's coalition government is aiming to enact further pro-immigration policies early next year that recognise the qualifications of more working age migrants, allowing them to work in Germany and pay taxes.

Yet the country's far right groups have been pushing back against this, and it would appear even making historic political gains as a result, all of which could deter skilled immigrants from settling in the country.

What's more, according to studies, many Ukrainians intend on returning to their country once the conflict ends, said Poutvaara.

"If I were to take a narrow German perspective, then the more Ukrainians that remain, the more it would help the host countries to deal with their demographic challenges, but if one takes a wider European perspective, we have a very strong interest in rebuilding Ukraine, even if it means they host countries do not get the demographic dividend from them staying."

This leaves Europe's largest economy needing to find solutions that will also encourage an increase in its German born population - no easy task.

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