Census shows dramatically aging workforce

OTTAWA - Canada's workforce is aging dramatically as the baby boom generation slides into retirement, census data released Tuesday shows, and labour analysts are sounding alarm bells about the economic fallout if shortages in IT, skilled labour and health care are allowed to materialize.

Statistics Canada says 15.3 per cent of Canadian workers are 55 or older and nearing retirement, and, for the first time, there are just as many Canadian workers over 40 as under.

The combined force of retiring boomers and declining fertility rates have conspired to erode the ratio of retirees to replacement workers.

In 2006, there were 1.9 Canadians aged 20-34 entering the workforce for every person aged 55-64 leaving it. There were 2.7 replacement workers for every retiree five years ago and, 25 years ago, there were 3.7.

Statistics Canada analyst Geoff Bowlby says it could take the labour market 20 years to correct itself.

"We know the Canadian workforce is getting older. We know that it is inevitable that baby boomers approaching retirement will eventually retire or leave the labour market," Bowlby said.

"That will have an impact on the labour market well into the future, probably for the next two decades."

Industry watchers say governments and corporations across the country are unprepared for the labour shortages that will result.

"Right now many organizations are in denial about the whole issue," said Linda Duxbury, a labour specialist at Carleton University's Sprott School of Business.

"Any government sector, any public sector, doesn't matter if it's municipal, provincial or federal, are going to have real big issues. The other big group that's going to have huge issues is health care and education."

Between 2001 and 2006 the country's overall annual employment growth dominated that of the G7 nations - rising at 1.7 per cent each year.

Alberta's thriving oil and gas industries and B.C.'s booming construction industry accounted for one third of the surging employment rate hike.

Researchers have been warning for years about potential labour shortages across Canada, yet, labour market analysts say employers and governments have not responded, and they are now predicting a widespread shortage of workers impacting a broad range of occupations.

The year opened with a Conference Board of Canada report warning that 90,000 jobs in the tech industry need to be filled in the next three years to avoid a $10-billion blow to the economy.

A shortage of the right kind of workers can damage a healthy economy because the labour market and economy are so tightly bound.

When the ratio of workers arriving to the workplace dips below the number leaving it, it creates a drag on the economy and stagnates growth.

The looming worker shortage is compounded by a glut of middle-aged workers whose knowledge base is quickly becoming obsolete.

"We're in bit of a transition time," said Linda Franklin, president of Colleges Ontario, a group representing the province's 24 colleges of applied arts and technology.

"We have workers who are desperately in need of retraining so that they're able to do other jobs that are crying out for people."

"As time goes forward, as the baby boomers retire and as we have fewer young people coming into the workforce, we are going to face a very serious crisis."

For those entering or established in the workforce, the seller's market could produce a set of employees who will demand better wages, benefits and working conditions or they will threaten to walk.

Some say the thriving Alberta economy is a microcosm of what's to come for the nation.
Dan Kelly, Western Canadian vice-president of the Canadian Federation of Independent Business, says several firms there are tolerating corporate theft rather than fire staff they cannot easily replace.

"They're so desperate to hang onto any staff they can," he said. "They can't afford to get rid of them."

Companies which spent the last three years clamouring for the best workers - or any workers - to fill jobs as the economy booms, now find some of those who pledged their loyalty to the oilsands of Fort McMurray have marched over to Vancouver for top-dollar construction jobs ahead of the 2010 Olympics.

Finance Minister Jim Flaherty has warned that labour shortages are one of the "most daunting economic challenges" Canada will face in coming years.

In January, he said Ottawa needs to find ways to help Canada hold onto its skilled workers and draw talented immigrants to the country to help avert an economic nightmare.

But just a few days later there were media reports about immigrants from France, highly prized and ardently recruited, packing up in droves and going home because they are working at menial jobs and struggling to make ends meet, suggesting employers and governments are only paying lip service to immigrants.

Already more than one-fifth of the country's 17 million workers are immigrants, Statistics Canada says. About 1.1 million immigrants moved to Canada between 2001 and 2006, and more than half of them were within the "core working-age," between 25 and 54 years old.

Despite the market boom in Alberta, most immigrants chose to move to Ontario, the census data showed.

One Ontario company took to heart the call for immigrants to bolster the labour market.
The George Kelk Corp., a Toronto-based electronics manufacturing company that builds parts for steel mills, is like a mini United Nations.

Eighty per cent of its 160 employees were born in 48 countries including Canada.
"Our company could not exist without this very significant pool of educated immigrants in Toronto," said president Peter Kelk.

Not all immigrants are so fortunate. Stories about doctors and engineers driving taxi cabs proliferate through urban centres like Toronto and Vancouver - tales of people who came to Canada to build a better life for their families but fell short of the stringent qualifications, or their degrees simply weren't recognized.