Older Workers: Key to Addressing EU Labor Market Challenges

Individuals aged 60 to 69 could play a crucial role in alleviating the European Union's labor market challenges amid an escalating demographic crisis. A report from Allianz Trade indicates that with effective delayed retirement strategies, the proportion of this age group in the workforce could rise from 9% in 2023 to 14.2% by 2040. This increase could help companies address up to 75% of the projected labor shortage.

In Bulgaria, the engagement level of people over 60 in the workforce is currently above the EU average, thanks in part to the increased retirement age. In 2023, over 60% of individuals aged 60 to 64 were still working, placing Bulgaria 11th among the 27 EU member states. Sweden leads this age group with more than 73% participation, while Luxembourg has the lowest rate at only 23%.

The employment rate for Bulgarians aged 64 to 69 is also notable, with nearly 20% still in the labor market. In contrast, only 5% of this age group continues to work in Romania, although Estonia sees a significantly higher rate of 38%.

To address labor shortages, Bulgaria may also need to focus on attracting migrants. However, it currently ranks last in the EU for foreign worker participation, with only 0.2% of the workforce comprised of foreigners, compared to the EU average of over 9%. Additionally, Bulgaria is a significant exporter of labor to Western Europe, complicating its domestic labor market situation.

The report highlights various challenges associated with retaining older individuals in the workforce. For Europe to effectively leverage this demographic, companies must implement substantial changes in their workplace policies. This includes rethinking work processes, schedules, and investing in age-appropriate workplace equipment....