BANFF, Alta. – Canada’s aging population, combined with a lacklustre birthrate, is going to dramatically impact our country’s economic performance in the future, according to an expert in the field.
Canada is going to prove troublesome within the next 12 years, David Foot, a professor of economics at the University of Toronto and co-author of the book “Boom, Bust & Echo: How to Profit from the Coming Demographic Shift” told the Global Business Forum in Banff, Alta., Thursday.
For a country to successfully replace its aging workforce, it needs a birthrate of 2.2 children per family, Foot said. He added that Canada is only managing a rate of 1.7 per family and that means Canada’s labour woes are going to get even worse.
“Canada is significantly older than the U.S. and Mexico, with a much bigger percentage in the older-age brackets and ever fewer numbers of young people being born in Canada,” said Foot.
“That’s well below replacement and if you don’t have an extensive child-care program to support women raising their children, you’ll watch your fertility rate continue to decline.”
Foot said that although Canada is better educated than Mexico, its NAFTA partner is doing much better with its fertility rate and has a ready supply of new workers for the future.
He said Canada’s move toward trying to fast track more immigrant workers to combat the labour shortage is doomed to fail.
“If you add immigrants into the mix and look ahead to 2026 … that already has a quarter-million immigrants. I can raise immigration in Canada to 300,000 or 350,000 but it will not change that picture,” said Foot.
“Ten million boomers every year are getting a year older. We bring in a quarter-million immigrants. How many years do you have to bring in a quarter-million immigrants? 40 years.”
Foot said that aside from taking steps to encourage a higher fertility rate, he doesn’t see the situation changing.
“That is the future for your business leaders and an aging population inevitably leads to slower economic growth.”
Canada is in better shape than many other countries around the world, said Foot. Italy, Spain and Greece have the oldest populations in Europe, while former powerhouses such as Germany, Japan and Russia have been watching their populations decline significantly.
“These are three countries that are never coming back as global powers. Germany, Russia and Japan are powers of the past … not the powers of the future.”
Foot said the future superpowers include China, India and Brazil while Turkey is emerging as the future power within Europe.
“Within five years a Muslim country will be the biggest market in Europe.”
The Global Business Forum wraps up on Friday.