The Economic Impacts of Aging in Canada: Macroeconomic Indicators and Policy Implications

Abstract

ABSTRACTThe declining rate of population growth and the consequent aging of the Canadian population is not a new phenomenon. However, current data and population projections suggest that the rate of aging will increase over the remainder of this century and beyond. From a macroeconomic viewpoint this implies a substantial decline in the growth of the labour force and, hence, the growth potential of the Canadian economy. However, this potential is also influenced by saving (and hence capital accumulation) and productivity performance. In these cases the impacts of population aging are relatively under-researched and reflect the resolution of conflicting forces. From a public policy viewpoint the pressures on government spending from demographic sources are at an historical minimum in the early 1980s, and hence this period offers a unique opportunity to develop the policies to effect the necessary transfer of public resources from programmes oriented towards the young to those oriented towards the senior members of Canadian society.