The aging baby boomer population will burden the Ontario economy with decades of sluggish growth, warns demography expert David Foot.
Speaking to the Economic Developers Council of Ontario (EDCO) in London Wednesday, the University of Toronto economics professor said aging populations tends to slow economies all over the world with reduced demand for many goods, fewer young workers and a smaller tax base.
He warned the economic development officials, who are holding their annual conference outside of Toronto for the first time, that Canada's economic growth will stall at around 2%. annually.
?Business in Canada has to stop talking about growth. An aging population has slower economic growth. Growth become less important than sustainability,? said Foot, author of the best-selling book, Boom, Bust, Echo.
Foot said there won't be any labour shortages anytime soon because baby boomers (born between 1947 and 1966) are still in the labour market.
?I tell my students most boomers are in their 50's, they're not leaving the workforce to make room for you . . . They will gradually trickle out of the workforce over the next 20 years,? he said.
Foot said demand for manufactured goods, including automobiles, will tend to sag in the coming years but the demand for services will increase.
Foot said the Japanese and European economies are already feeling the impact of aging populations while nations such as Brazil, Turkey, Vietnam and Mexico will surge ahead in the coming years because of their younger populations.
He said the United States will also do better than Canada because of an influx of Hispanics with large families who have become a growing factor in the American economy.
?Now is a good time to learn Spanish,? said Foot.
Foot displayed a demographic profile of London which he said was typical of Ontario as a whole, with a distinct bulge of baby boomers in their 50-60s and ?echo boomers? in their 20s and early 30's.
But he noted smaller communities such as Sarnia tend to have an older population.
?The farther you get from the big cities, the older the population,? he said.
Foot said smaller rural communities will have to meet the demand for health facilities
?The need for health care is moving away from the big cities. So why do we build our big hospitals in the big cities where all the young people are??
Foot noted there may be a small bump in the demand for day care in the next next few years because the children of baby boomers are now starting their own families.
But he warned against building new schools because enrolments over the long term will be stable or decline.
Foot said the stress on provincial health care system in the last decade was not due to baby boomers but a relatively large group born back in the 1920's.
He said the demand for health care will likely recede for some time before ramping up sharply when baby boomers hit their senior years.
?We have about a decade to get health care right before it hits the fan, ?he said.
hank.daniszewski@sunmedia.ca
ON THE RISE:
- Casinos
- Bird-watching
- Gardening
- Wine
- Brazil
- Turkey
- Vietnam
ON THE WANE:
- School enrollment
- Contact sports
- Manufactured goods
- Beer
- Japan
- Germany
- Russia
WHAT WE SPEND MONEY ON:
in our 30's: Child care
in our 40's: Pet care
in our 50's: Eyeglasses
in our 60's: Pharmaceuticals
- - -
Q&A with David Foot
Q: Is the London population typical of Ontario's demographic trends?
Very much so. - Boom, bust, echo bust.
As you get further away from big urban environments, communities get older. As you get closer they get younger. London sits beautifully in the middle. You are a test market for demographics too.
Q: Where is our manufacturing sector headed?
?If you going to stick to manufacturing you have to be far more creative and use knowledge and technology to compete globally.
Consumers have moved on to the service economy - financial planning, health care and travel
Q: Will London health care facilities fare well?
It's a service sector, but it demands manufactured goods.. Now is the time to prepare (for aging of baby boomers) - getting supply chains established. You don't necessarily need a big, complex hospital, but a series of specialized clinics that just do something like cataract removal or hip replacement.
Q: Why do think London could see a bigger share of immigrants?
Immigrants have been older lately because we have been taking longer to process their applications. If you are 22 you will likely go to downtown Toronto. But if you are 32 you have likely started a family and have different needs and a regional centre like London Kitchener and Guelph is attracting that kind of immigrant.
Q: There's always concern about the city losing all the bright graduates from Western. What can we do?
We now have the technology to stay in touch with these young people. You let them go in their 20s because that's they way they get experience. When they start a family in their early 30's you will remind them how much they enjoyed growing up in the region and they will likely seek a job back here for a stable environment to raise their families.
Q: So what should communities be building to prepare for an aging population?
For aging boomers casinos are the new entertainment complex. Be ready to turn your hockey arenas into curling communities. You don't throw them away, you just don't add to capacity. Schools could be turned be turned into a seniors complex with classrooms becoming condos and the playgrounds turned into beautiful gardens
Source: http://www.lfpress.com/2013/02/06/baby-boomers-blamed-for-sluggish-economic-outlook-in-ontario
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