Which effect on the labour market is most likely when population ageing increases in a country?

Correct answer: Labour shortages in some sectors and a need to reconsider retirement age

The governing concept is the relationship between age composition and labour supply. As population ageing increases, the proportion of older people rises while the number of younger entrants may become smaller. Retirements can then exceed the number of new workers entering some occupations, producing labour shortages, skill gaps and greater pressure on pension and care systems. Option A is correct because governments and employers may respond through later retirement, retraining, productivity improvements, higher female participation or carefully managed migration. Option B is unacceptable and unrelated to a sound demographic response. Option C is too extreme: ageing changes the supply and composition of labour but does not eliminate all employment. Option D is also wrong because working-age analysis remains important for planning.