Targeting younger immigrants key to easing aging population woes on the Canadian economy, according to Conference Board of Canada report released today.
The report finds if immigration levels were to increase steadily to reach 407,000 immigrants per year by 2030 and we were to target younger immigrants, Canada’s trend pace of economic growth would improve to 2.3 per cent by 2050 from its current trajectory of below 2 per cent.
However, the author insists immigration alone is not the only solution to cope with the effects of aging demographics on health care, pension plans and economy.
“In order to fully address the significant cost strains on the Canadian system from an aging population, policy makers must also consider other solutions,” Matthew Stewart, Associate Director, National Forecast says. “Immigration provides an important source of labour and helps Canada generate stronger long-term economic growth. However, increasing immigration alone will not reverse Canada’s aging trend.”
The report, A Long-Term View of Canada’s Demographics: Is Higher Migration Part of the Response to Canada’s Aging Population? – sights major strain on health care and Canada’s retirement income support systems. Without significant changes to how health care is delivered in Canada over the next 20 to 30 years, the share of government revenues directed to health care is expected to rise from 37 per cent today to 44 per cent. With the provinces already struggling with large deficits, this added burden would be unsustainable. In the meantime, spending on Old Age Security (OAS) would drop from 12 percent to below 10 percent.
With the provinces already struggling with large deficits, this added burden would be unsustainable. In the meantime, spending on Old Age Security (OAS) would drop from 12 percent to below 10 percent,. the report concludes.
Currently, Canadians aged 65 and over make up about 16 percent of Canada’s total population. Over the next 20 years, this figure will continue to rise to over 24 percent.