Our aging society is not all bad news

Réforme des retraites - Sécurité de la vieillesse

A report from Statistics Canada this week drew media and public attention back to a long-established - we won't say "old" - story: The Canadian population is maturing rapidly. Age 70, or even 75, is becoming the new 65.
The reporting focused on the "demographic crisis" that will put "new strains" on our economy, society, health system, etc. etc.
All of that is correct, as far as it goes. But hardly anywhere in the extensive reporting did anyone pause to remark on what very good news these statistics are. Some 4.3 million Canadians today are 65 or older, the highest number ever, and most of these people, we dare say, are enjoying life. Collectively our seniors, supported by modern medicine and record savings, are more vigorous and prosperous than previous generations of seniors. And Canadians under 65 can also look forward to lives that will be, by historical standards, both long and pleasant. This is a spectacular success story.

From that perspective, the demographic changes outlined by StatsCan can be seen not as a crisis, but as an opportunity. Public-policy changes today have the potential to make life better still, not only for today's seniors and for baby boomers as they age but also for their children and grandchildren and beyond.
Take, for example, the "looming labour shortage" that figured so prominently in yesterday's coverage. As more people retire, the workforce will dwindle, not perhaps in absolute numbers but as a percentage of the population. This will mean, we are told, fewer people paying income tax, and fewer people to drive our buses, staff our medical clinics, collect our statistics, and so on. And we know that immigration cannot make up the difference.
But the scary scenarios of some headlines do not have to become reality. First of all, seniors do and will pay taxes. The mountain of cash that boomers and others have stowed away in Registered Retirement Savings Plans will be withdrawn again, in a gathering torrent, and tax will surely be paid on it; just ask anyone now drawing down an RRSP. Further, while seniors do require more health care than younger people, they demand less of certain other government services, from schools to prisons.
It's true that health care eats up a growing share of government program spending, crowding out other departments' needs, but that is hardly a new phenomenon, and there's a clear, if disorganized, trend toward more private spending on health, and that will ease the pressure.
The dark aspect of growing numbers of seniors is that in the final stages of life some old people are subject to abuse, or at least callous treatment. Conditions in Quebec long-term care facilities have produced enough alarming stories in recent years that everyone is aware of the dangers.
But Quebec's new seniors' ministry, and careful inquiry into the issue, can be expected to lead to improvements. This is an example of how society and government can, by changing priorities, adjust to demographic change.
The manpower side of the demographic shift is also manageable, if there's enough foresight. The problem is productivity, or economic output per hour worked. We can't easily make our bus drivers cover more kilometres per hour, but we can, for example, buy StatsCan better computers so that workers there can crunch more numbers per hour.
Capital investment to spur productivity has grown with pathetic slowness in Canada, but governments are trying to give employers incentive in this direction. Last March's federal budget, for example, accelerated capital cost allowances to speed investment. The stronger dollar should make equipment imports cheaper. More steps are possible, too.
Other aspects of the manpower problem can also be tackled. It becomes more urgent than ever that every capable young person get all the education possible, since a skilled workforce is essential to productivity. From computer repairs to geriatric medicine, jobs are more complicated now than ever before. Education and trades training must keep up. Instead of starving the school system, governments should be fertilizing it generously, and fighting hard against the drop-out phenomenon.
At the other end of the labour force, many seniors will want to work past 65. Here governments have already started, slowly, to help. Jim Flaherty's federal budget, like Monique Jerome-Forget's Quebec one this spring, promised measures to let people have, to some degree, the best of both worlds: still working, perhaps part-time, while drawing a pension.

We could also do more, as a society, to retain trained and productive people. Every time a newly credentialed doctor or nurse moves to Boston or Phoenix for lower taxes, higher incomes and better conditions, Canada loses not only tax revenue but a medical professional.
Then there's the birth rate. We have often been critical, in this space, of Quebec's costly social programs, but it turns out that Canada's most-generous parental-leave program has recently been matched by a modest increase in the birth rate. The trend, if that's what it proves to be, is new, but the logic is limpid: Canadians have told pollsters clearly that what they really want, when it's time to have kids, is for one parent to be able to remain at home.
Population change presents challenges for society, government, and business. But we can handle this. The baby boom of the 1950s demanded rapid change, too. Pediatricians were in short supply, schools were bursting with 6-year-olds, and suburbs sprawled across the landscape. Society evolved, and government scrambled to keep up.
Now the same process is happening again. As the age structure of the Canadian population changes, governments, and employers, will need to work hard to keep up. But we're a resilient people, with a supple private-sector economy and reasonably responsive governments. And, we like to think, we're accumulating quite a lot of wisdom, too, even if from time to time we're not quite sure where we left our eyeglasses.

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