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Financial Times (London), March 18, 2005

EU urges action on falling population

Author : Sarah Laitner

DATELINE: BRUSSELS

Brussels yesterday spelt out the extent of the European Union's stark population decline and ageing workforce, calling for swift reform to address its "unprecedented" demographic change.

By 2030 an extra 40m people - equivalent to the population of Spain - will be above retirement age, the European Commission said as it detailed the EU's ageing population, dwindling birth rate and retiring baby-boomers.

Tackling the bloc's dem-ographic difficulties is seen as central to helping growth in its economies, which face shortages of millions of workers over the coming decades.

Vladimir Spidla, employment commissioner, said immigration was helping to prop up the EU's population, which would grow slightly to 470m in 2025 before falling.

But the working age population is due to fall by 21m between 2005 and 2030. By contrast, the US population is likely to rise until 2050.

Europeans have a fertility rate of 1.5, which is below the level needed to replace the population and only two of the bloc's 25 countries - Malta and Cyprus - have growing populations.

Mr Spidla, the former Czech prime minister, said immigration alone would not solve the EU's demographic problems.

He said people were discouraged from having more children by difficulties in finding housing, late entry into employment, family- unfriendly environments and job instability. Pro-family policies, particularly on childcare, leave for both parents and family benefits were needed. Reform of pensions and increased productivity should also be part of the EU's response.

"It is clear we are going to need pensions reform and that people's working lives are going to have to be extended," Mr Spidla said.

He added that with increasing numbers of elderly people, countries should help to support fam-ilies, social services and community networks in caring for them.

The Commission will in September start considering legislative options to address the problems.

<< Financial Times -- 3/18/05 >>

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