Growing old gracefully: How to ease population ageing in Europe

[January 2008 - Centre for European Reform] Europe is on the cusp of a demographic revolution. Rising life expectancy and low fertility are radically transforming Europe's demographic profile. Ageing populations pose profound political, economic and social challenges. Many commentators are deeply pessimistic about the consequences of population ageing for the social and economic fabric of Europe. But Alasdair Murray's essay takes a more optimistic view. He argues that although pro-natal policies or increased immigration cannot be relied on to reverse Europe's long-term population trends, demography is not destiny. European governments can adapt to counter the economic effects of ageing. Aside from raising the age of retirement, they can - and should - adopt measures that help to boost participation in the labour force and encourage job creation. Reforms to European labour markets would do much to mitigate the adverse impact of ageing on the public finances and economic growth. At root, Europe faces more of a labour market problem than an intractable demographic crisis. More (PDF)