29 november 2007
The European Union needs to undertake far-reaching labour market reforms if it wants to be able to safeguard its social security system, experts have said.
“Europeans tend to support – and expect – a high level of social security, but many question whether this will be affordable with fewer payers and a disproportionate rise in the number of recipients of, in particular, pensions and health care,” Fabian Zuleeg, senior policy analyst at the European Policy Centre wrote in a paper released on Thursday.
The EU’s population
According to demographic predictions, the EU’s population will not only shrink by almost 20 million people by 2050, but its make-up will also change dramatically. While there are currently about four working people of working age for each person of pension age in the EU’s 27 member states, there will be fewer than two people to support every elderly person by 2050, with the population gradually ageing.
Older workers could earn less
Mr Zuleeg said that employment rates need to increase, especially among women, older people, ethnic minorities, people with disabilities and low-skilled people. These groups that are currently under-represented in the labour markets of most EU member states, though substantial differences exist between countries.