Preparing for Demographic Change in the Banská Bystrica Region, Slovak Republic

Executive Summary

The Banská Bystrica region (BBSK) is the Slovak Republic’s largest region by territory but also its least densely populated. In 2023, it was home to around 617,000 people, 11% of the Slovak population, spread across 516 municipalities, 91% of which have fewer than 2,000 residents. Its settlement patterns are highly dispersed, shaped by a mountainous landscape and valuable natural assets, including national parks, forests, and cultural heritage sites. The region benefits from tourism, a strong forestry sector, and urban centres such as Banská Bystrica and Zvolen, which act as administrative and service hubs. Despite these strengths, BBSK is one of the Slovak regions most exposed to demographic decline and structural economic challenges.

The regional economy performs well below national and OECD averages. GDP per capita is 21% lower than the Slovak average, and labour productivity ranks among the lowest 10% of OECD TL3 regions. While large industrial employers and universities provide some stability, opportunities for high-quality employment remain limited, fuelling persistent outmigration. The region’s cultural diversity, with large Roma and Hungarian minorities, represents both an asset and a challenge, as persistent socio-economic gaps continue to hinder integration and growth.

BBSK has also experienced steep depopulation. Since 2000, its population has fallen by nearly 7%, the fastest decline among Slovak regions. By 2050, it is projected to shrink by a further 11%, with the share of residents aged 65 and over rising by about 60%. These shifts reflect a combination of low fertility rates, sustained youth outmigration, and population ageing. Fertility has remained below replacement level, while young and well-educated people continue to leave the region for Bratislava or abroad. As a result, outmigration is disproportionately concentrated among the most skilled, raising the risk that the region falls into a “talent development trap,” in which demographic decline is compounded by the erosion of human capital. At the same time, parts of southern BBSK are experiencing population growth due to higher fertility rates among Roma communities, but weak integration into education and labour markets prevents these dynamics from translating into broader development gains.

Adapting land use and spatial planning

Spatial and land-use planning frameworks are not adapted to the demographic realities of BBSK. Despite population decline, built-up areas continue to expand, leading to inefficient use of land. Developers often prefer greenfield sites, where upfront costs are lower, while many town centres and rural villages face rising vacancy rates. Vacant and underused housing is widespread, driven by unclear property rights, unclaimed inheritance, and emigration. These trends create high infrastructure costs, reduce investment efficiency, and put additional pressure on agricultural and natural land. Land fragmentation, incomplete cadastre records, and weak enforcement of planning rules further exacerbate inefficiency. Although Slovakia’s 2022 spatial planning reform (Change 2032) represents progress, by requiring local land-use plans and encouraging integration of demographic projections, municipalities often lack the capacity and resources to implement reforms. To help address these challenges, the report provides detailed recommendations in three broad areas:

• Promote compact development around key local centres

• Expand high-quality affordable housing provision, especially in core urban centres

• Enhance and accelerate land consolidation to redevelop vacant properties.

Adapting multi-level governance frameworks and subnational finances

BBSK suffers from one of the most fragmented territorial governance structures in the OECD. With more than 500 municipalities, most very small, the region faces a severe capacity gap. Shrinking populations erode the tax base, while per-capita costs of delivering services rise, producing a “scissors effect”, while the Roma population presents unique fiscal and planning challenges. Regional and municipal reliance on central transfers is high, with personal income tax redistribution as the main revenue source. This mechanism is sensitive to demographic decline and provides little stability or autonomy for long-term planning. Property taxes are underused and inter-municipal cooperation remains weak, limiting the ability to pool resources or coordinate investment. Despite decentralisation reforms, the region’s governance remains complex and highly centralised in practice. Regional authorities and municipalities often lack the fiscal autonomy and technical capacity to design and implement strategies. Accessing and managing EU funds remains a challenge for smaller municipalities, where administrative capacity is limited. To help address these challenges, the report provides detailed recommendations in five broad areas:

• Improve the decentralisation framework and increase the efficiency of the multi-level governance system

• Plan strategically to better co-ordinate responses to demographic change across levels of government and with civil society

• Increase service delivery in small, ageing and shrinking municipalities via inter-municipal co-operation

• Strengthen subnational government finance

• Invest more effectively to support regional needs.

Adapting service provision

Demographic decline and ageing place increasing strain on education, healthcare, and transport systems. Public transport in BBSK remains fragmented, poorly coordinated across administrative borders, and insufficiently linked to labour markets, which reduces accessibility to jobs and essential services. While investment has improved infrastructure, service provision continues to be uneven, particularly in rural and mountainous areas. Education is also under pressure. Falling enrolments are increasing per-student costs and straining municipal and regional budgets. Participation in pre-school and upper-secondary education is comparatively low, and student outcomes in mathematics, reading, and science fall below EU averages. Rural schools face declining quality and persistent difficulties in recruiting teachers. Healthcare outcomes present another critical challenge, with mortality rates in BBSK well above the EU average. Preventive and public health services are underdeveloped, limiting progress toward healthy ageing, and Roma communities in particular continue to face significant barriers in accessing both education and healthcare. To help address these challenges, the report provides detailed recommendations in five broad areas:

• Adapt the national regulation governing the public service provision

• Strengthen public service accessibility and emphasise its importance broadly

• Improve education system effectiveness and respond to evolving educational needs

• Respond more flexibly to rising healthcare demand

• Provide placed-based public employment services (PES).