Unless OECD countries adapt their employment policies to the new demographic realities, they will face shrinking workforces and declining prosperity, warned a new report released here on Monday.

According to the report, many current policies in OECD ( Organization of Economic and Cooperation Development) countries are relics of a past era that penalize, rather than reward, older workers for carrying on working.

On average in OECD countries, fewer than 60 percent of people aged between 50 and 64 have a job, compared with 75 percent of people in the 25-49 age group.

"If there is no change in work patterns, the ratio of older inactive persons per worker will almost double in the OECD area over the next decades, from around 38 percent in 2000 to just over 70 percent in 2050," said the report.

"This, in turn, would lead to higher taxes and lower benefits, coupled with slower economic growth," it added.

On the basis of unchanged patterns, the report shows that GDP ( gross domestic products) growth per capita in the OECD area could shrink to around 1.7 percent per year over the next three decades, about 30 percent below the average annual rates witnessed between 1970 and 2000.

To avoid such an outcome, the report argues, age-friendly employment policies are needed to encourage older people to remain longer in the workforce.

At present, average effective retirement ages are well below official retirement ages in many countries, especially European countries.

The OECD report recommends action in three key areas:

Governments should ensure that pensions and other welfare arrangements encourage rather than discourage work at older ages. They should also devote adequate resources to help older jobseekers find a new job.

Meanwhile, employers must end discrimination and adapt work practices to an age-diverse workforce. The practice of mandatory retirement in firms should be questioned, as it is inconsistent with the general objective of providing greater choice to older workers on when to retire.

Older workers themselves will also need to change their attitudes towards working longer and acquiring new skills.

The OECD groups 30 member states, most of which are Western European countries.

Source: Xinhua