Davos (Switzerland): According to a study released today (Jan 19, 2004), the sizeable workforce in India and China should help to boost their economic growth while the European Union's share of global economic output is set to shrink almost by half.

The study done by the World Economic Forum (WEF) and US consultancy firm Watson Wyatt Worldwide also states that Japan and other rich nations would face a similar dilemma.

"Economic output is determined by labour force growth and productivity rates," said Richard Sammans, a managing director at the WEF.

"In countries with dramatic labour shortages, the supply of goods and services may not meet demand and standards of living," he said in a statement.

The report, titled "Living happily ever after: the economic implications of ageing societies", compiled over the past two years, estimates that in India the number of working-age people will increase by 335 million by 2030 -- almost as much as the EU and the United States' combined workforce in 2000.

In addition, it forecasts that South East Asia would see its labour force grow by 58 per cent within the next three decades.

The number of people in retirement compared to those who work is rising as medical advances increase life expectancy -- especially in the developed world -- with a direct impact on economic output, the study noted.