Demographic change in Europe and Central Asia: Addressing the issue of a shrinking and ageing labour force

This paper identifies existing labour market challenges associated with ageing in Europe and Central Asia. It presents a general overview and provides ideas to stimulate social dialogue. In 2024, there were 28 persons aged 65 years and above per 100 persons aged 15 to 64 years and this ratio is projected to rise to 43 by 2050. The proportion of older workers (55 years and above) will increase, while the prime-age workforce (25 to 54 years) will decline. This demographic transition is expected to result in a net loss of 10 million workers in the region by 2050. As pension systems increasingly have to rely on a diminishing pool of younger workers, sustaining current living standards will become more challenging. Productivity growth in Europe and Central Asia has been falling since 1991. New sources of productivity have to be unlocked if current standards of living are to be maintained. Increasing the labour force participation of inadequately represented groups, including women, persons with disabilities, the youth, migrants and refugees may only partially improve the situation. However, it would be a step forward in improving the outlook for the challenges that the region is experiencing.