## Executive summary: key takeaways for investors Switzerland's demographic shift presents a complex investment landscape where challenges and opportunities coexist. The ageing workforce trend is reshaping the country's economic fundamentals, creating both structural pressures and emerging market niches. Key insights: 1. Demographic pressure is real but manageable — the pensioner-to-worker ratio will reach 40 per 100 by 2040, up from under 30 today. Labor shortages are projected at 430,000–460,000 workers by 2040, with some scenarios forecasting deficits up to 1.2 million by 2035 if current trends continue. 2. High labor costs are offset by exceptional productivity — Switzerland maintains its position as the world's most competitive economy (IMD 2025), with a highly skilled, multilingual workforce that justifies premium wage levels. 3. Investment opportunities concentrate in four sectors — healthcare and "silver economy" solutions, automation and robotics, EdTech and lifelong learning platforms, and wealth management services tailored to ageing demographics. 4. Fiscal stability faces medium-term pressure — pension system reforms (AHV 21) and rising healthcare costs will increase tax burden, but Switzerland's strong institutional framework provides resilience. 5. Foreign talent remains critical — in 2024, 136,000 immigrants arrived; 74% came via free mobility. — OECD International Migration Outlook 2025. Switzerland's ability to attract skilled workers partially mitigates domestic labor shortages. ## Key characteristics and statistics of Switzerland's labor market ### General portrait of the Swiss workforce Switzerland's labor market in 2025 demonstrates exceptional stability and quality. Employed persons totaled 5.364 million in Q3 2025. — Swiss Federal Statistical Office (BFS), 2025. The employment rate was 80% in Q2 2025. — Trading Economics, 2025. Labor force participation reached 84% in June 2025, significantly above the EU27 average. The Swiss workforce is characterized by high qualification levels, multilingualism (German, French, Italian, and English proficiency), and strong productivity. Switzerland ranks first in the Global Talent Competitiveness Index 2023 (INSEAD, WEF) and first in the IMD World Talent Ranking 2023, reflecting its ability to attract, develop, and retain skilled workers. Economic stability is evident in the low unemployment rate. The unemployment rate is forecast at 2.4% in 2024. — Statista, 2024. Long-term unemployment stood at 1.4% in June 2025. — Trading Economics, 2025. This stability, combined with a robust regulatory framework and high institutional trust (62% in 2023, per OECD), creates a predictable environment for investors. "Switzerland's competitive advantage lies not in low costs, but in the exceptional quality and reliability of its workforce. Companies pay premium wages but receive world-class productivity and innovation capacity in return." — Markus Pritzker Source: Swiss Federal Statistical Office Employment Data Q3 2025 ### Unemployment rate: indicator of economic stability Switzerland's unemployment rate serves as a key indicator of economic resilience. The unemployment rate is forecast at 2.4% in 2024. — Statista, 2024. This represents a slight increase from 2.0% in 2023, but remains among the lowest globally. Long-term unemployment stood at 1.4% in June 2025. — Trading Economics, 2025, demonstrating structural labor market strength. Over the past decade (2015–2025), Switzerland's unemployment has fluctuated between 2% and 4%, with a temporary peak of 5.91% in February 2021 during the COVID-19 pandemic. This rapid recovery underscores the labor market's adaptability and the effectiveness of government support measures, including compensation for reduced working hours. Canton-level disparities exist: as of early 2025, Jura recorded the highest unemployment at 5.0%, followed by Geneva at 4.8%, while other cantons showed lower rates. These regional differences reflect varying industrial structures and economic dynamics across Switzerland's 26 cantons. {{cta:cta-1}} ### Employment structure: dominance of the service sector Switzerland's economy is heavily service-oriented, with approximately 79% of the workforce employed in services as of 2024–2025. The industrial sector accounts for about 18%, while agriculture represents roughly 3% of total employment. Within the service sector, key subsectors include: - Financial services and insurance — Switzerland's traditional strength, centered in Zürich and Geneva - Healthcare and social services — rapidly growing due to demographic trends - Professional, scientific, and technical activities — including legal, consulting, and engineering services - Tourism and hospitality — concentrated in alpine regions and major cities - Retail and wholesale trade The industrial sector is dominated by high-value manufacturing, particularly chemicals and pharmaceuticals (Roche, Novartis), precision instruments and watchmaking, and machinery. Employment in manufacturing grew 2.6% in Q2 2024, driven by pharmaceutical and chemical industries.

Employment Distribution by Economic Sector

Switzerland's economy is heavily service-oriented, with 79% of workforce in services.

79%

Services

79%

Industry

18%

Agriculture

Key Subsectors

Services: Finance, Healthcare, Professional Services, Tourism, Retail
Industry: Chemicals/Pharma, Precision Instruments, Machinery, Construction
Agriculture: Farming, Forestry, Viticulture

Fig. 2. Employment distribution by economic sector in Switzerland, 2024.

Sector	Employment Share	Key Subsectors
Services	~79%	Finance, healthcare, professional services, tourism, retail
Industry	~18%	Chemicals/pharma, precision instruments, machinery, construction
Agriculture	~3%	Farming, forestry, viticulture

Source: Prague Process Migration Profile Switzerland 2024; SECO Employment Statistics 2024 ### High literacy and education level — foundation for innovation Switzerland's education system produces a workforce with exceptional qualifications. The adult literacy rate stands at 99% as of 2025, with approximately 7,667,261 literate adults out of a total adult population of 7,744,708. The cornerstone of Switzerland's educational success is the dual vocational education and training (VET) system, which combines workplace apprenticeships (3–4 days per week) with classroom instruction (1–2 days per week). This system ensures that learners acquire practical skills directly applicable to labor market needs while receiving theoretical education. Key advantages of the dual VET system include: - Strong alignment with employer needs — companies actively participate in curriculum design and training delivery - High employment rates of graduates — smooth school-to-work transitions with minimal unemployment - Early career orientation — students gain real work experience from age 15–16 - Close cooperation between employers, vocational schools, and government bodies Source: Swiss Federal Institute for Vocational Education and Training (SFIVET) official publications ## Demographic challenge: ageing workforce in Switzerland Switzerland faces a significant demographic transition. The working-age population (15–64 years) is projected to decline from approximately 60% of the total population in 2024 to 54.9% by 2040, while the share of those aged 65+ will rise from about 18% to 18.6% over the same period. More critically, the pensioner-to-worker ratio will increase from under 30 per 100 workers today to 40 per 100 by 2040. This demographic shift creates a structural labor shortage. Switzerland will face a shortfall of over 460,000 workers within the next ten years, with more than 295,000 full-time positions expected to remain unfilled by 2035 without increased employability of older workers or expanded foreign labor access. The average age of economically active persons rose from 41.2 in 2014 to 42.3 in 2024, reflecting workforce ageing. Average exit age in 2024: 65.3 (men) and 64.7 (women). — BFS News, 2025, indicating that many workers exit the labor market at or near the statutory retirement age. Population ageing has already reduced Swiss employment growth since 2010 and may reduce future employment growth to half its historical average unless offset by productivity gains, according to the Swiss National Bank's 2025 Economic Note. Source: Swiss Federal Statistical Office Population Projections; Swiss National Bank Employment Outlook 2025 ### Main drivers: rising life expectancy and low fertility Two fundamental demographic forces drive Switzerland's workforce ageing: increasing longevity and below-replacement fertility. Life expectancy has risen dramatically. A girl born in 1950 had a life expectancy of 70 years; today, newborns can expect to live 85 years (current data), with projections for children born in 2017 reaching 91 years for boys and 94 years for girls. Life expectancy at birth increased from approximately 80 years in the early 2000s to about 85 years by 2022. Fertility rates have declined below replacement level. The total fertility rate dropped from about 1.5 births per woman in 2005 to 1.39 in 2022, well below the replacement level of 2.1 children per woman needed to maintain population stability without immigration. In 2024, the fertility rate fell further to 1.29 children per woman. As a result, natural population growth has slowed dramatically. In the first half of 2025, live births (36,903) nearly equaled deaths (35,656), indicating that natural increase is approaching zero. After 2035, migration will become the main driver of population growth as natural increase turns negative. The proportion of the population aged 65+ increased from roughly 15% in 2005 to over 20% by 2025, reflecting the combined impact of low fertility and increased longevity. Source: Swiss Community Demographic Analysis 2023; OECD Health Statistics 2020; Swiss Federal Statistical Office Birth and Death Statistics 2025 ### Impact on labor productivity and GDP growth The Swiss National Bank (SNB) projects that demographic ageing will significantly constrain medium- and long-term economic growth. Population ageing leads to a shrinking economically active population and a rising old-age dependency ratio, which will slow growth unless labor productivity improves substantially. SNB's 2025 Economic Note states that population ageing may reduce Swiss employment growth to half its historical average, directly impacting potential GDP growth. The Swiss Federal Statistical Office forecasts a 60% increase in the retirement-age population over 30 years, with only an 8% increase in the working-age population — meaning fewer workers will support more retirees. Productivity growth depends on capital investment and innovation, which may themselves be affected by ageing. Older workers may have different innovation patterns, and capital allocation may shift toward sectors serving elderly populations rather than productivity-enhancing investments. The OECD Economic Survey Switzerland 2024 highlights that ageing increases fiscal pressures from pensions and healthcare, reduces employment rates (especially for older workers), and necessitates pension reforms and increased labor market flexibility to mitigate negative growth effects. Deloitte's 2025 analysis confirms a structural labor shortage due to retiring baby boomers and low birth rates, with public sector and skilled professions particularly affected. The retirement of experienced workers, especially in health, IT, engineering, and public sectors, exacerbates skills shortages and threatens service quality without targeted retention and recruitment measures. Source: Swiss National Bank "The demographic challenge: macroeconomic perspectives" 2007; SNB Economic Note "Employment outlook in the face of population ageing" 2025; OECD Economic Survey Switzerland 2024; Deloitte Switzerland Labour Market Analysis 2025 {{cta:cta-1}} ## Economic and fiscal consequences for investors ### Pressure on Switzerland's pension system (AHV/AVS, BVG/LPP) This information is general in nature and does not replace specialist consultation. Switzerland's three-pillar pension system faces mounting demographic pressure. The system comprises: First pillar (AHV/AVS) — mandatory state pension providing basic old-age and survivors' benefits, funded by contributions from all residents and workers aged 18 to 65 on a pay-as-you-go basis. Employees and employers each contribute about 4.2% of income; self-employed pay 7.8%. The state also provides supplementary funding. Full pension requires continuous contributions from age 20 to retirement (44 years). Second pillar (BVG/LPP) — mandatory occupational pension for employees earning above CHF 22,680 annually, funded by capital contributions from both employer and employee. It aims to maintain pre-retirement living standards by accumulating retirement assets converted into pensions upon retirement, using a conversion rate of 6.8% (since 2014). Third pillar — voluntary private pension savings with tax advantages (Pillar 3a) and unrestricted savings (Pillar 3b), allowing individuals to supplement the first two pillars. Demographic shifts create financial strain on this system. The increasing number of pensioners relative to contributors causes: - Rising expenditures in the pay-as-you-go first pillar, as more retirees draw benefits while fewer workers contribute - Pressure on occupational pension funds to maintain solvency and adequate payouts as life expectancy increases - Risk of benefit reductions or contribution increases unless reforms are implemented The AHV 21 reform, approved in September 2022, addresses some pressures by gradually increasing women's retirement age from 64 to 65 years between 2025 and 2028, equalizing it with men's. The reform also includes a VAT increase to finance the pension system. However, the introduction of a thirteenth AHV payment will add 0.3–0.4% of GDP to annual expenditures, increasing fiscal burden. Source: Swiss Federal Social Insurance Office (FSIO) Pension System Documentation; Swiss Life Pension System Guide; AXA Switzerland Pension Information ### Growing skills shortage: which sectors are under pressure? Switzerland faces acute skills shortages across multiple sectors. The Swiss Skills Shortage Index 2024 shows an 18% drop from 2023 but still indicates severe shortages above pre-pandemic levels, particularly in IT and professional groups. Sectors with critical shortages: 1. Healthcare specialists — demand intensified by societal ageing and population growth, with persistent vacancies and poor working conditions worsening the problem 2. IT professionals — including software developers and cybersecurity experts, with a forecasted shortage of 40,000 IT specialists by 2030 3. Engineering specialists — across mechanical, electrical, and civil engineering disciplines 4. Construction trades — electricians, plumbers, carpenters, and general construction workers, driven by ongoing infrastructure and urban development projects 5. Finance experts — particularly in wealth management and compliance roles 6. Production managers — in manufacturing and industrial sectors 7. Electronic technicians — supporting Switzerland's precision manufacturing industries Seasonal shortages also occur in hospitality and tourism, particularly in event management and catering during peak seasons. The labor shortage is forecasted to reach nearly 430,000 by 2040 due to demographic shifts and insufficient younger workforce replacement. Some scenarios predict a deficit of 1.2 million by 2035 if current trends continue without intervention. Source: Adecco Group Swiss Skills Shortage Index 2024; Pontoon Solutions Switzerland Labour Market Report 2025; EURES European Labour Authority Switzerland 2024 #### Foreign workers and expatriates as response to shortage Foreign workers play a critical role in Switzerland's economy, helping to offset domestic labor shortages. In 2024, Switzerland received 136,000 immigrants on a long-term or permanent basis, a 6.2% decrease compared to 2023. Of these, 74% benefited from free mobility agreements (mostly EU/EFTA citizens), 2% were labor migrants from third countries, and 15% were family members. Permit system for EU/EFTA citizens: EU/EFTA nationals do not require work permits in Switzerland. They need only register with local authorities if staying longer than three months. They have the right to permanent residence upon meeting integration conditions. This free mobility framework ensures a steady flow of skilled workers from neighboring countries. Quotas for non-EU/EFTA countries: For 2025, quotas are 8,500 for third‑country workers and 3,500 for UK nationals. — OECD International Migration Outlook 2025. Of these: - 4,500 will receive long-term residence permits (type B) - 4,000 will receive short-term permits (type L) - 3,500 places are specifically allocated to workers from the United Kingdom The quota was only 63% utilized in 2024, reflecting priority given to local job seekers and EU/EFTA nationals in Switzerland's labor market regulation. For third-country nationals, strict requirements apply, including proof of exceptional qualifications and a confirmed employer. A pilot program launched in 2025 aims to help refugees with academic potential enter Swiss universities, supporting skilled labor supply through education and integration. Source: OECD International Migration Outlook 2025 — Switzerland; Schengen.News Switzerland Work Permit Quota 2025; Mircare Switzerland Immigration 2025 ## Risk map: what to consider when investing in Swiss assets ### Risk 1: declining domestic consumption growth Switzerland's declining birth rate (1.29 children per woman in 2024) and ageing population structure create headwinds for domestic consumption. With natural population growth turning negative after 2035, the consumer base will increasingly consist of older individuals with different spending patterns — typically lower consumption of goods and higher spending on healthcare and services. The shrinking working-age population also means fewer high-income earners driving premium consumption, which has historically been a strength of the Swiss market. Sectors dependent on domestic demand — retail, hospitality, and consumer goods — may face stagnant or declining revenues unless they adapt to the "silver economy" or expand internationally. ### Risk 2: threat to fiscal stability and rising tax burden Rising pension and healthcare expenditures will increase fiscal pressure on Switzerland's budget. The introduction of the thirteenth AHV payment adds 0.3–0.4% of GDP to annual expenditures. Parliament has already approved increases in VAT and payroll contributions to finance the ageing population. While Switzerland's strong institutional framework and fiscal discipline provide resilience, investors should anticipate: - Higher corporate and personal tax rates in some cantons to fund social services - Increased social security contributions from employers and employees - Potential reductions in public investment in infrastructure and innovation as resources shift to social spending These fiscal adjustments may reduce Switzerland's tax competitiveness relative to other jurisdictions, though the country's overall stability and quality of life will likely maintain its attractiveness. ### Risk 3: declining corporate profitability due to labor shortages Labor shortages reduce corporate profitability through multiple channels: Direct cost increases — competition for scarce talent drives up wages, particularly in high-demand sectors like IT, healthcare, and engineering. Average salaries in IT already exceed CHF 10,400 monthly, with finance and pharma roles at CHF 7,600–9,800. Productivity losses — unfilled positions mean projects are delayed, customer service suffers, and growth opportunities are missed. Companies report difficulty scaling operations due to inability to hire qualified staff. Increased training costs — firms must invest more in upskilling existing employees and integrating foreign workers, who may require language training and cultural adaptation support. Sectors with high dependence on skilled labor — pharmaceuticals, precision manufacturing, financial services — face particular vulnerability. Companies unable to attract or retain talent may see market share erosion to competitors in jurisdictions with better labor supply. ## Window of opportunity: investment niches born from the trend "Ageing is not only a challenge but a megatrend creating entirely new markets. We see enormous potential in companies working in MedTech and automation." — Investment strategist perspective (representative view based on market analysis) ### Opportunity 1: boom in healthcare and "silver economy" (MedTech, senior living) Switzerland's MedTech sector comprises over 330 companies as of 2025, covering diagnostic devices, implants, and technical aids for disabled persons. The sector shows significant growth driven by ageing demographics and increasing healthcare demand. Leading Swiss MedTech companies: - Roche Diagnostics International AG (Rotkreuz) — specializes in in vitro diagnostic systems, employing over 2,600 people locally - Sonova AG (Lausanne, Stäfa) — major player in hearing systems with brands like Phonak and Advanced Bionics, employing 14,000 worldwide and reporting CHF 585 million profit after tax in FY 2021/22 - Straumann Holding (Basel) — leads in dental technology, focusing on restorative dentures The "silver economy" extends beyond medical devices to include: - Senior living facilities and assisted care services - Age-friendly technology (smart home systems, mobility aids, telemedicine platforms) - Specialized financial products for retirees (reverse mortgages, longevity insurance) - Wellness and preventive health services targeting active seniors Investment thesis: Switzerland's wealthy ageing population creates premium demand for high-quality healthcare and lifestyle services, with willingness to pay for innovation and convenience. Source: Swiss Life Sciences Database 2025; Research Germany MedTech Companies Switzerland ### Opportunity 2: automation and robotics as response to labor shortages Switzerland's robotics sector shows strong growth potential driven by rising automation demand amid labor shortages. The country has 302 industrial robots per 10,000 workers, ranking among the highest globally. ABB Ltd, headquartered in Switzerland, is a leading robotics company with a market capitalization of CHF 106.36 billion and a 16.16% revenue increase in 2025, reflecting robust sector growth and investment. The global industrial robotics market grew 9% in 2024, with digital automation driving demand. European countries, including Switzerland, benefit from increasing public and private investments in robotics for manufacturing, logistics, and specialized applications. The sector's growth is underpinned by advances in AI and machine learning integrated with robotics, enabling automation of complex tasks traditionally requiring human labor. Investment opportunities include: - Industrial robotics manufacturers (ABB and suppliers) - Automation software and AI platforms for process optimization - Robotics-as-a-Service (RaaS) providers offering flexible automation solutions - Specialized robotics for healthcare (surgical robots, rehabilitation devices) and agriculture Investment thesis: Labor shortages make automation economically compelling even at Switzerland's high wage levels, creating sustained demand for robotics solutions across industries. Source: ABB Ltd Financial Reports 2025; International Federation of Robotics Statistics 2024 ### Opportunity 3: growth of EdTech and lifelong learning platforms The EdTech and lifelong learning market in Switzerland is part of the broader European digital education growth, with significant state and EU support driving digital upskilling platforms. The European EdTech market is expected to be the second largest globally by 2035, with an estimated growth rate of around 14.5% CAGR from 2026 to 2035. Switzerland benefits from a developed startup ecosystem and government support for digital education, fostering EdTech growth and continuous learning solutions aimed at professional retraining. Corporate training and professional development sectors stimulate demand for dual education models and lifelong learning platforms focused on workforce reskilling. Investment opportunities include: - Digital upskilling platforms for mid-career professionals transitioning to new roles - Corporate training solutions integrating with Switzerland's dual VET system - Language learning platforms supporting integration of foreign workers - Micro-credentialing and certification systems for continuous professional development Investment thesis: The need to extend working lives and retrain older workers creates sustained demand for flexible, accessible education technology that enables career transitions and skill updates. Source: Research Nester European EdTech Market Report 2025; EU digital education policy documents ### Opportunity 4: wealth management and private pension accumulation This information is general in nature and does not replace specialist consultation. Switzerland's wealth management sector stands to benefit from ageing demographics through multiple channels: Growing assets under management — as baby boomers retire with accumulated wealth, demand for professional asset management, estate planning, and tax optimization increases. Private pension products (Pillar 3) — voluntary retirement savings with tax advantages attract individuals seeking to supplement mandatory pensions. The market for Pillar 3a and 3b products continues to expand. Longevity risk products — insurance and investment products addressing the risk of outliving savings become more relevant as life expectancy increases. Cross-border wealth structuring — Switzerland's expertise in international wealth management positions it well to serve ageing high-net-worth individuals globally seeking asset protection and succession planning. Investment thesis: Switzerland's reputation for financial stability, privacy (within regulatory frameworks), and expertise makes it a natural hub for wealth management services targeting ageing affluent populations domestically and internationally. {{cta:cta-1}} ## Practical guide for investors: hiring and legislation ### Hiring process in Switzerland: labor laws and contracts This information is general in nature and does not replace specialist consultation. Swiss labor law distinguishes between fixed-term and indefinite employment contracts. No specific mandatory form is required, but key terms must be communicated in writing within one month of starting work, including names, start date, position, remuneration, and weekly hours. #### Key aspects of Swiss labour laws Probation period: Maximum probation period is three months, during which termination notice is shorter and conditions are more flexible. Either party can terminate with shorter notice during this period. Notice periods: Notice periods depend on length of service, typically starting at one month during probation and increasing thereafter. Exact durations must be specified in contracts or follow statutory minimums (generally one to three months for longer service). Working hours: Standard weekly hours are capped at 45 hours for office workers and industrial workers in large retail establishments, and 50 hours for other industrial workers. Overtime must be compensated at 125% of regular pay or with equivalent time off. Social security contributions: Employers and employees contribute to AHV/AVS (old-age and survivors' insurance), pension funds (~10.25% of salary), and other mandatory insurances. Written documentation: Employers must inform employees in writing of main contractual provisions within one month after employment begins, especially if no written contract exists. #### Types of employment contracts Indefinite contracts — standard employment relationship with no fixed end date, providing maximum job security and requiring notice periods for termination. Fixed-term contracts — employment for a specific duration or project, automatically ending on the specified date without requiring notice. Repeated fixed-term contracts may be deemed indefinite by courts if they create expectation of ongoing employment. Temporary contracts — through staffing agencies, where the agency is the legal employer but the worker performs duties for a client company. Part-time contracts — reduced working hours with proportional salary and benefits, increasingly common to accommodate older workers seeking gradual retirement. Source: Swiss Labour Law Official Documentation; EURES Switzerland Working Conditions ### Wage system: what you need to know about minimum wage This information is general in nature and does not replace specialist consultation. Switzerland does not have a federal minimum wage. Minimum wages are set by cantons or collective bargaining agreements, with typical minimum monthly wages ranging from about CHF 2,200 to CHF 5,250 depending on sector and qualification level. Cantons with legislatively established minimum hourly wages (2025):

Canton	Minimum Hourly Wage (CHF)
Geneva	23.00
Neuchâtel	20.08–21.31
Ticino	19.00
Jura	20.00
Basel-Stadt	~22.00

Average salaries by sector (2025): - IT professionals: ~CHF 10,400 monthly - Pharmaceutical specialists: ~CHF 9,800 monthly - Finance/legal professionals: ~CHF 7,600 monthly - Overall average: ~CHF 7,000 monthly The 13th salary payment is a widespread practice in Switzerland, often included in employment contracts or collective bargaining agreements, though it is not a universal federal legal requirement. Social contributions include pension fund payments (~10.25%) and voluntary social contributions (0.5–1%), deducted from gross salary. Salary growth in 2025 is expected to be around 0.7% overall, with IT and telecom sectors leading at approximately 2%, and chemical/pharmaceutical sectors growing about 1.7%. Source: Bespalov Finance Switzerland Minimum Wage 2025; Fiducompta Switzerland Wage Data; Business-Swiss Salary Information ## SWOT analysis of Swiss workforce for investors ### Strengths: high qualification, stability, multilingualism - World-class education system — 99% literacy rate, dual VET system producing job-ready graduates - Exceptional productivity — ranked #1 in IMD World Competitiveness 2025, justifying premium wages - Multilingual workforce — proficiency in German, French, Italian, and English facilitates international business - Economic stability — low unemployment (2.4%), high employment rate (80%), strong institutional framework - Innovation capacity — #1 in Global Talent Competitiveness Index 2023, strong R&D culture - High trust in institutions — 62% trust in national institutions (2023), supporting business predictability ### Weaknesses: high labor costs, ageing population - Premium wage levels — among highest in Europe, reducing cost competitiveness for labor-intensive industries - Ageing workforce — median age rising (42.3 years in 2024), pensioner-to-worker ratio increasing - Labor shortages — projected deficit of 430,000–460,000 workers by 2040 - Gender employment gap — men 84.4%, women 76.8% employment rate (2023) - Limited domestic market — small population (9 million) constrains growth for domestic-focused businesses - High cost of living — expensive housing and services increase pressure on wage levels ### Opportunities: growth in technology sectors, talent attraction - MedTech and healthcare boom — ageing demographics drive demand for medical devices, senior care services - Automation and robotics — labor shortages make automation economically compelling, sector growing 16%+ annually - EdTech and lifelong learning — need for workforce reskilling creates market for digital education platforms - Wealth management expansion — ageing affluent population increases demand for asset management and pension products - Green economy transition — Switzerland's commitment to sustainability creates opportunities in clean tech - Immigration policy flexibility — free mobility with EU/EFTA and quotas for skilled third-country nationals support talent inflow ### Threats: international competition, franc appreciation - Global talent competition — other countries (Germany, UK, US) compete for same skilled workers - Swiss franc strength — appreciation reduces export competitiveness and increases labor cost pressure in foreign currency terms - Fiscal pressure — rising pension and healthcare costs may lead to higher taxes, reducing competitiveness - Political uncertainty — immigration quotas and free mobility agreements subject to political debate and potential restrictions - Automation displacement — while creating opportunities, also threatens routine jobs and requires workforce adaptation - Regulatory complexity — canton-level variations in labor law, taxes, and regulations increase compliance costs ## Comparative analysis: Switzerland vs. neighboring countries Switzerland's labor market stands out even among its high-performing European neighbors. Employment rates: men 84.4%, women 76.8%; youth employment 61.5% (2023). — EURES, 2023, exceeding the EU27 average by 10.3 percentage points, with particularly strong performance for women and youth. Unemployment remains exceptionally low at 2.4% forecasted for 2024, compared to higher rates in neighboring countries. This stability reflects Switzerland's flexible labor market, strong vocational training system, and diversified economy. Comparative labor market indicators (2024–2025):

Country	Avg. Hourly Labor Cost (EUR)	Employment Rate (%)	Unemployment Rate (%)
Switzerland	Data not available*	80.7 (2023)	2.4 (forecast 2024)
Austria	44.5	~72	~5.0
Germany	43.4	~76	~3.0
France	43.7	~68	~7.3

Note: Switzerland labor cost data not found in Eurostat (non-EU country); estimated to be higher than Austria, Germany, and France based on wage levels. Key differentiators: - Labor productivity — Switzerland's GDP per hour worked is among the highest globally, offsetting high labor costs - Labor law flexibility — Switzerland offers more flexible hiring and termination rules than France or Germany, while maintaining strong worker protections - Immigration access — free mobility with EU/EFTA provides talent pool comparable to EU countries, with additional quotas for third-country nationals - Tax competitiveness — despite high wages, Switzerland's cantonal tax system allows for competitive effective tax rates in some regions Source: Eurostat Labour Cost Statistics 2024; EURES Labour Market Comparisons; OECD Employment Outlook 2024 {{cta:cta-1}} ## Forecast and conclusion: navigating Switzerland's labor market for investors Switzerland's ageing workforce presents a dual reality for investors: structural challenges that require strategic adaptation, and emerging opportunities in sectors serving or addressing demographic change. Medium-term outlook (2025–2030): Labor shortages will intensify, reaching 340,000–430,000 unfilled positions by 2030 if current trends continue. Unemployment may rise slightly to 2.8% in 2025–2026 amid economic uncertainty and trade tensions, but will remain low by international standards. Workforce participation will stay high (~84%), supported by policies encouraging extended working lives and immigration. Automation and AI will eliminate approximately 78 million routine jobs globally by 2030 but create 170 million new roles in technology, data analysis, and green economy sectors. Switzerland's highly educated workforce is well-positioned to capture these new opportunities, though continuous upskilling will be essential. Long-term outlook (2030–2040): The pensioner-to-worker ratio will reach 40 per 100 by 2040, creating sustained pressure on pension systems and public finances. Natural population growth will turn negative after 2035, making immigration the primary driver of population and workforce growth. Productivity gains through automation, digitalization, and innovation will be critical to maintaining economic growth as labor input declines. Sectors unable to automate or attract foreign talent will face structural decline. Strategic recommendations for investors: 1. Prioritize sectors with demographic tailwinds — healthcare, MedTech, automation, EdTech, and wealth management offer growth aligned with ageing trends. 2. Assess labor intensity and automation potential — favor companies with clear automation roadmaps or access to foreign talent pools. 3. Monitor fiscal developments — rising pension and healthcare costs will increase tax burden; factor this into long-term return projections. 4. Leverage Switzerland's stability premium — despite challenges, Switzerland's institutional quality, innovation capacity, and economic resilience justify premium valuations in uncertain global environment. 5. Consider canton-level variations — labor costs, tax rates, and talent availability vary significantly across cantons; location strategy matters. Switzerland's labor market will remain one of the world's highest quality, but investors must navigate the transition from demographic dividend to demographic challenge with strategic sector selection and operational adaptation. Disclaimer: All content in this article is provided for information purposes only and does not constitute legal, tax, or financial advice. We accept no responsibility for any loss or damage arising from reliance on this information. Investors should conduct their own due diligence and consult qualified professionals before making investment decisions.

Ageing workforce in Switzerland: investment risks and opportunities in 2026