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Canada's population ageing fast |
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Canada's population is ageing fast according to new population
projections, a scenario with socio-economic consequences that increased
immigration alone may not be able to solve.
The new study released by Statistics Canada said at current projections, senior citizens would outnumber children in about a decade.
Seniors aged 65 and over would become more numerous than children aged less than 15 around the year 2015, said the report. The proportion of the working-age population, that is the population aged 15 to 64, would decline steadily in the 2010s and 2020s.
The trend has potential for major economic impact both in terms of growth per capita as measured through GDP and ultimately the standard of living.
The impact on the economy can occur because of:
- Reduced public savings because of the call on public resources for age related services and income support
- Reduced private savings through individuals drawing down on their savings to fund their retirement
- Reduction in investment because of the drawdown on national savings
- Reduced taxation through wages and salaries and subsequent pressures on federal budgets
- A slowing of productivity growth with the contraction of labour supply loss of human capital through retirement without replacement by younger people
While there is no guarantee that any of these effects will be felt, the possibility must be considered fairly high.
According to StatCan, the fast increase in the number of seniors would be an unprecedented situation in Canada.
In 2005, Canada's population was younger than the populations of most of the G8 countries. However, it is expected to age more rapidly in the coming years as a direct result of the pronounced baby boom following the Second World War and the rapid decline in fertility that followed.
The projections show that population ageing, which has already begun, would accelerate in 2011 when the first baby-boom cohort (born in 1946) reaches the age of 65. This rapid ageing is projected to last until 2031, when seniors would account for between 23% and 25% of the total population. This would be almost double their current proportion of 13%.
The current median age of the population is 39, that is, half the population is older and half younger. By 2031, it would reach between 43 and 46.
If immigration level is an important factor of future population growth, immigration alone cannot reverse this ageing trend, says StatCan.
Natural increase in the population will eventually become negative, that is, there would be more deaths than births. This could occur anywhere between 2020 and 2046, says the report.
As that stage, immigration would become the country's only source of population growth.
Immigration levels already contribute heavily to the projected population growth at the national level, as the fertility rate is assumed to remain below the replacement level in all scenarios, a situation observed since the 1970s.
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