The Influence of Changing Population Age Structure on the Labor Supply and Economic Activity Rate in Iran and its Forecasting Until 2025

Iran, like other developing countries, has experienced stages of demographic transition since 1950s. During 1955-1975, the high total fertility rate (6.5 children per women) led to relative increase of population under 15 years to above 40 percent. Iran, has experienced a reduction of fertility over 1980-2010.The aim of this paper is to determine  the effect of changing in population age structure on the labor supply and economic activity rate in Iran, during the 1966-2011 and to forecast the rate until  2025. Documentary method and comparative analysis has been used. Data are derived from the Statistical Center of Iran (1966-2006) and ILO estimation's for 1986, 1996 and 2006. To achieve a structural model, this study has applied the indirect technique of standardizing age-specific activity rates and a comparsion was made with selected countries.The results showed remarkable changes in economic participation rates and share of economically active population.