The first wave of baby boomers will retire next year, marking a demographic shift that will reshape European labour markets over the next 20 years and widen the skills gap that many companies are already struggling to fill.
Europe's ageing population will force companies and governments to re-think the traditional model of retirement.
The recent financial crisis has highlighted the fact that many Europeans must work into their sunset years, mainly for financial reasons.
For companies in every country this presents opportunities and challenges.
On the plus side, mature workers tend to have valuable and practical experience. They can be more productive than their younger counterparts. They also change jobs less often, which saves employers the cost of recruiting and training replacements.
On the other hand, there can be office friction when older workers have to report to younger managers. Older workers also can be more expensive, both in terms of salaries and health-related issues. They are also more likely to have minor disabilities that require adjustments not only in the work place but also in transportation.
About 13% of Europeans have some sort of disability, according to Luk Zelderloo, secretary general for the European Association of Service Providers for Persons with Disabilities. He said another 25 million people will be added to those ranks by 2025, largely due to age-related problems.
"We need to find new ways to deal with the increasing need. The European Union needs to help us create new types of jobs, they need to help us with training and retraining, how to use new technology and unlock the job creation potential," Zelderloo told an audience on Wednesday (23 November) during the Employment Week conference in Brussels.
A day earlier, the European Commission presented its 'Agenda for New Skills and Jobs,' outlining 13 actions to reform labour markets and upgrade skills. The immediate focus, of course, is the 23 million Europeans of all ages who are currently seeking work. But keeping workers active for longer also helps generate taxes to fund pensions, health care and other social services.
The agenda is part of the Union's 'Europe 2020' strategy, which aims to increase work force participation to 75%, up from 69% today.
"It will be very difficult to reach this target," said Marian Krzaklewski, a Polish politician and member of the national commission of trade union Solidarno??.
As more retirees kick up their feet, there will be a shortage of workers unless businesses invest in recruiting and retaining their greying staff.
Krzaklewski explained that a decade ago about 37% of Europeans aged 55 to 64 were still actively working. In 2001, the EU set a target of 50% by this year, but the participation rate never rose above 45%.
Of course there were wide variations throughout Europe. The rate climbed in every country except Romania, he said, with Sweden at the top with 70% of older workers still collecting a pay check.
There were also differences by gender and education. About 55% of older men were still in the labour market five years ago, compared with 34% of women.
One company that has a good track record of keeping workers past retirement age is Sick, a German manufacturer of sensors and scanners. Life-long learning and training is one of the most important topics, said Rudolf Kast, head of human resources for Sick. Employees also need lifetime working time structures that adapt to different phases in life, from parenthood to rejuvenating sabbaticals.
"The older workers in our company support the demographic system," he explained.