Labour Force Participation Scenarios for 27 European Countries, 2002–2052

Abstract

This chapter presents assumptions about the future patterns of labour force participation for 27 European countries for the period 2002–2052. It is assumed that population ageing and, in some countries, population decline will lead to either a relative or, in some cases, an absolute decline in the working age population and an increase in the share of older workers (55 years and older) in the labour force. This, together with the decline in the number of younger workers, will gradually lead to labour and skill shortages, resulting in more flexible forms and conditions of employment. These changes will attract to the market some of the hitherto inactive, especially from the older age groups, students and women. The scenarios assume convergence of the countries’ labour force participation patterns to an arbitrarily chosen model pattern. Different patterns have been established for men and women; some geographical variation of patterns of women’s activity has also been accounted for. They were chosen on the basis of observed tendencies, as well as expected convergence of labour supply behaviours between countries and widely understood labour market needs. The trends from past observations govern entirely the very first years of the projection. The between-country participation convergence and target values determine the labour force participation rates at the end of the projection horizon.