Canada is now dealing with the ‘Great Retirement,’ a version of the Great Resignation that spread throughout the United States earlier last year.
The labour force in Canada increased in August but decreased in the two preceding months and is still lower than it was before the summer due to tens of thousands of people who stopped working. According to Statistics Canada, a large portion of this can be attributed to more Canadians retiring than ever.
Not only are people over 65 closing down their offices and putting away their tool belts, but so are many other groups. For example, Statistics Canada data reveals that a record number of Canadians aged 55 to 64 reported having retired within the last 12 months.
According to economists, rushed retirement is causing a breakout of Canada’s most highly skilled workers, leaving businesses to scramble, driving up wages substantially and threatening the nation’s already low productivity.
Jimmy Jean, the chief economist of Desjardins Group, said, “We knew from a long time ago that this wave was coming, that we would get into this moment,” and in the upcoming years, it will only get worse.
There is a loss of human capital and knowledge if people leave the workforce and there aren’t enough younger workers to take their place, which is currently happening in some industries, explained Jean.
Retirements decreased as more Canadians chose to work during the pandemic. Many people are also attempting to make up for the missed time by travelling and spending more time with relatives now that restrictions have been eased.
As a result of their departures, the labour force is diminishing, which may hurt economic development when the central bank is actively raising interest rates to combat rising inflation and growing concerns that the economy could enter a recession.
According to StatsCan, Canada has the highest proportion of people of working age in the G7, yet at the same time, its labour force has never been older. In Canada, one out of every five workers is 55 or older. Canada has also increased immigration to support economic growth.
Further StatsCan data shows that 307,000 Canadians have quit their jobs in the previous year to retire. This number is up 31.8% from the last year and 12.5% from August 2019, before the pandemic began.
More than 620,000 Canadians turned 65 or older during the pandemic, a 9.7% rise in that population group. The growing retiring population is adding to the problem. Nevertheless, job openings and ads are still much above pre-pandemic levels after three consecutive months of job losses.
Severe increase in the retirement of nurses and truckers
The retirement issue is particularly severe in highly specialized professions like nursing and trades. For example, although a record number of nurses reported working overtime since May, Canada has lost 34,400 jobs in the healthcare sector.
President of the Ontario Nurses’ Association, Cathryn Hoy, says those jobs were not cuts but more people retiring.
She highlighted the pandemic, poor working conditions, and a pay dispute with Canada’s largest province as contributing factors to the “massive problem” of unexpected retirements.
Due to the pandemic-driven frantic demand for more goods and the ageing population, the transportation sector is similarly experiencing a severe labour shortage.
The owner of Trans-Canada College, a career college that trains transport truck drivers, Tony Reeder, stated that many drivers are ageing, retiring or considering different lifestyles.
Meanwhile, trucking businesses are in high demand, Reeder said. As a result, many employ student drivers for on-the-job training programmes before hiring them permanently as soon as they receive their full licences.
Without trucks and drivers, he continued, “goods will remain at ports and in warehouses rather than travelling to the location.”
Presented by CTC News