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The Labour Market Impact of Rapid Ageing of Government Employees: Some Illustrative Scenarios


  • Jens Høj
  • Sylvie Toly


This paper estimates and discusses some of the potential labour market implications arising from the rapid ageing of government employees in a number of OECD countries. Under alternative scenarios for future public employment policies, available labour resources for the private sector are estimated taking into account the declining age cohorts entering the labour market. These scenarios suggest that, in the absence of considerable increases in labour utilisation, maintaining government sector hiring at their historical share of new labour market entrants will entail sharp declines in the production of government services. On the other hand, if present levels of government services are to be preserved, governments are likely to hire an increasing share of labour market entrants, creating a strong crowding-out effect for the private sector. Alternatively, productivity in the government sector would have to increase substantially. Conséquences sur le marché du travail du vieillissement rapide des employés du secteur public Cette étude donne des estimations et analyse quelques implications potentielles du vieillissement rapide des employés du secteur public dans plusieurs pays de l'OCDE. Sous des scénarios alternatifs de politique d'emploi public, l'accroissement de l'offre d'emploi disponible pour le secteur privé a été estimée prenant en considération l'évolution future des cohortes de jeunes entrant dans le marché du travail. Ces scénarios suggèrent qu'en absence d'un accroissement considérable de l'utilisation de la force de travail, le maintien de la part de l'embauche dans le secteur public à son niveau historique impliquerait un déclin assez considérable dans la production des services publics. Alternativement, si les niveaux actuels de service public devraient être maintenus, le secteur public devra pendre un part croissant des nouveaux entrants dans le marché du travail, créant un fort effet d'éviction pour le secteur privé. Une autre solution serait d'accroître substantiellement la productivité dans le secteurs publics.

Suggested Citation

  • Jens Høj & Sylvie Toly, 2005. "The Labour Market Impact of Rapid Ageing of Government Employees: Some Illustrative Scenarios," OECD Economics Department Working Papers 441, OECD Publishing.
  • Handle: RePEc:oec:ecoaaa:441-en

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    References listed on IDEAS

    1. Alfonso Arpaia & Giuseppe Carone, 2004. "Do labour taxes (and their composition) affect wages in the short and in the long run?," Public Economics 0411004, EconWPA.
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    More about this item


    ageing; emploi; employment; government sector; labour supply and demand; offre de demande de travail; productivity; productivité; retirement; retraites; secteur des administrations publiques; services sociaux; social services; vieillissement;

    JEL classification:

    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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