Canada’s aging work force root of labour crunch: ‘This was always going to bite us’ | 24CA News

When Dan Gallagher appears to be like round his firm, he sees plenty of retirement events in his future.

While it’s not one thing he formally tracks, the CEO of Mikisew Group _ a Fort McMurray, Alta.-based firm that focuses on oilsands website providers, upkeep, logistics and building _ is aware of he’s bought extra staff approaching the top of their careers than simply beginning out.

“I take a walk around our shop, and around our field services workforce, and I can clearly see that demographic. It’s aging,” Gallagher mentioned.

The implications of that make him nervous.

Mikisew Group is already scuffling with a scarcity of labour, even recruiting as far-off as Australia simply to maintain its fleet of heavy gear transferring. And fundamental demographics counsel the corporate’s downside is ready to worsen, not higher.

“The ratio of apprentice to older worker here has been so low for so long that there just isn’t the bench strength to offset the people who are leaving,” Gallagher says.

For years, consultants have been warning of a looming wave of retirements as child boomers _ these born between 1946 and 1964 and Canada’s largest technology by dimension _ get older and begin to exit the work pressure en masse.

This nation’s labour pressure progress price has been trending downward since 2000, however the pattern has intensified lately. This “grey wave” has been on the horizon for some time, however consultants say it’s now crashing ashore.

According to Statistics Canada, between 2016 and 2021 greater than 1.4 million Canadians entered the ranks of these aged 55 and older.

Last yr alone, one in 5 Canadians of working age had been aged 55 to 64 _ an all-time excessive within the historical past of the Canadian census.

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“It’s like a truck pulling up in your rear-view mirror. You see it there, and it’s moving slowly, and then you look away for a while and suddenly it’s completely on your tail,” mentioned Mike Holden, chief economist for the Business Council of Alberta.

The arrival of the gray wave is going on on the similar time that companies of each dimension, in each trade, and in each province are complaining of labour shortages. As of the second quarter of 2022, there have been greater than one million vacant jobs in Canada _ the very best quarterly quantity on report.

That’s not a coincidence. While the COVID-19 pandemic did disrupt labour markets, it has borne plenty of the blame for ongoing labour shortages.

But Canada’s labour pressure participation price is presently solely barely beneath the place it was pre-pandemic. In truth, younger and middle-aged Canadians have returned to the workforce at ranges both near or properly above that noticed in 2019, a Scotiabank report factors out.

The similar report says the decline in total workforce participation that does exist is fully on account of Canadians aged 60 and above exiting the workforce. That means the true root of the present downside is Canada’s getting old inhabitants, and it has broad implications for the nation’s economic system.

“I think the most important thing that gets overlooked is, what are the consequences of these labour challenges?” says Patrick Gill, senior director with the Canadian Chamber of Commerce’s business information lab.

He factors out that round one in three Canadian companies (36 per cent) already report they’re presently going through a scarcity of labour. That determine climbs to about 45 per cent throughout the manufacturing and building industries and 58 per cent within the meals and lodging sector.

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“It translates to everyone working more hours, and that ultimately affects quality of life. It means slower growth, and it’s also a factor in supply chain delays.”

Concerned business teams have proposed numerous doable options to the looming demographic disaster, from boosting immigration ranges to discovering methods to retain older Canadians within the workforce for longer. (Some observers have even advised the federal government ought to enhance the age for Old Age Security, partly with a view to discourage early retirement).

But even a big enhance in immigration received’t be sufficient to halt the approaching tide, says Rafael Gomez, director of the University of Toronto’s Centre for Industrial Relations and Human Resources.

The final of Canada’s child increase technology will flip 65 in 2030, and as soon as this cohort is out of the workforce fully, the working age inhabitants _ these aged 15 to 64 _ will make up a smaller proportion of the general Canadian inhabitants.

“This was always going to bite us,” Gomez says. “Demographic trends are not easy to shift in a short-term way. In fact, it’s true that for 20 years we’re going to see a decline (in the labour force).”

While governments ought to make use of each coverage lever at their disposal to handle labour shortages, Gomez says, employers additionally want to just accept the truth that the challenges they’re having proper now filling vacancies are usually not going to go away.

“It is your new normal. And even if the economy goes in the tank, it’s not going to change the labour conditions,” he says.

“We are entering a time where we are going to have a younger workforce _ doing more, being asked to do more, being bidded for and competed for,” Gomez provides.

“Labour is going to be very difficult to find and employers are going to have to work hard to attract employees.”

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