We project medium/long term trends in labour force participation and employment for selected low-participation EU countries (Italy, Spain, Ireland, Hungary, Greece), with Sweden as a benchmark, by means of a dynamic microsimulation model. By 2020 none of the low-participation contries will be above the Europe 2020 target of 75% employment rate, though Ireland will be close; in all countries with the exception of Hungary the target will be approached only at the end of the simulation period, by 2050.
The gap in female participation is mostly explained by (i) differences in the individual conditional behaviour of older cohorts, (ii) inadequate family policies. In particular, our results show that the conditional behaviour of younger women in the low-participation countries in similar to that in Sweden. In a nutshell, what is needed is not a change of attitude on the side of women but a change of pace on the side of institutions and firms.