Vive Le Canada

Economy needs workers past 65
Date: Friday, October 21 2005
Topic:


Economy needs workers past 65
Labour shortage worries businesses
Immigrants, more babies not solution

JOHN GODDARD
STAFF REPORTER

Getting people to work longer not subsidizing more babies or bringing in more immigrants is the best way to boost the labour force as the population ages, the Conference Board of Canada says.

Developed nations tend to choose among three policy options in response to the aging trend, but two of them don't work, the Conference Board says in its annual performance report card.

"France is subsidizing women to have more babies," board president and chief executive Anne Golden told a Star editorial board meeting yesterday. But the cost of raising and educating a child in a developed country far exceeds such subsidies, she said.

"We're not thinking through immigration," Golden also said. Even if Canada were to bring in immigrants at a rate of 1 per cent of the current population a year an idea reiterated by Prime Minister Paul Martin last month there still would not be enough new workers to meet demand, she added.


The answer is later retirement, the Conference Board concludes in a 183-page report, Performance and Potential 2005-06: The World and Canada: Trends Reshaping Our Future.

The board is a non-profit business body. The report is its 10th annual Canadian performance review aimed at identifying what the country can be doing to increase productivity.

"We have at most another 10 years before the accelerating aging of the population begins to undermine economic performance and social well-being," it says.

"After 2010, the baby boomers will begin to retire, and by 2025, 20.4 per cent of the population will be over age 65 double the share in 1980.... There will be fewer people in the active labour force to support the retiring baby boomers."

Canadian workers are retiring earlier. In 1976, the average retirement age was 65. In 1998, the figure dropped to 61, and now stands at between 61 and 62.

On the longevity scale, Canadians rank high among developed nations, the report says.

"Canada's smoking rate is the lowest of the 24 countries we studied," it says. Similarly, rates of alcohol consumption and obesity proved relatively low, as were death rates from cancer and heart and circulatory diseases.

Despite such statistics, the report ranked Canada 10th in the health category, down from eighth last year.

Acquisition of MRI (magnetic resonance imaging) machines and radiation therapy units in Canada lags behind that of other countries, the report says. Canada has 2.1 doctors per 1,000 people, compared with 4.1 in Italy, the top performer in that category.

On the aging workforce question, the Conference Board says a coherent national strategy is needed both to motivate older people to keep working and to motivate employers to retain and hire older workers.

Its recommendations include:

Increase the eligibility age for government pension plans. Citing conclusions of the chief actuary of Canada, the Conference Board says the current system is too generous for retirees who begin collecting between 60 and 65 and penalizes people who continue working past 65.

Combat ageism in the workplace. "In most countries, there are deeply ingrained biases against older workers, and dispelling them is not easy."

Pass laws to eliminate mandatory retirement.

Reduce unemployment and disability benefits to prevent workers from using social security programs as a route to early retirement.

Provide better adult education and training to enhance older workers' employability.

Establish flexible work arrangements to accommodate older workers' health.

Help older workers find jobs through specific government employment services.

Offer subsidies to employers who hire and retain older workers, offsetting higher salaries often commanded by older workers compared with younger ones.

Here's a report that is on the right track. Local solutions for local problems.

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