A Money Coach in Canada

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Post #1 in August’s Work and Your Wallet series. While this post is Canada-specific, the same demographics are at play in the USA.

The bottom line is that if Canada’s GDP per capita (in plain English:  how much per person we produce – economically, I mean, not having progeny!) doesn’t grow each year (last year we produced 10 cars and 50 shipfulls of wheat and 10 truckloads of lumber;   this year we produced 11 cars and 52 shipfulls of wheat and 12 truckloads of lumber) then we suffer.  You and I suffer.

Bah.  Not suffer, not in relative-to-Guatemala terms.  But we have we don’t have as many cars to trade for bright shiny objects like iPads so we make do with fewer iPads.  Or fewer outfits.  Or fewer loaves of bread.

And how do we make sure we keep producing as much as or more than the prior year?   Making those cars and growing the wheat and cutting the lumber requires people.  In HR lingo, labour force.  Or for the high-falutin’ car-engineer types, talent pools.

If there’s one thing I picked up loud and clear in my 2 years of HR work, and attending a Cdn. Minister’s Conference (long story) on the topic, it’s that the issue is no longer theoretical.  It is upon us.  Our labour pool is just beginning to start its Big Shrink. It scared the crap outta me, truth be told.

**Let me guess.  At this point you are:  <  rolls eyes >    #I’vebeenhearingaboutthisforever. Right? **

Well so have I, and consider this.  The fact that you haven’t yet experienced it, haven’t felt it doesn’t mean it isn’t happening.  For one thing, it’s only just starting.  The first baby boomer cohort has just left the workforce.  No problem for year one.   But next year, it’s going to happen again.   And the next year, it’s going to happen again.   We’ll start to feel it then.   And in 2015 it will happen again.   My prediction is that 2015 is The Year when all doubt will be removed from our minds about the impact of the Boomer’s leaving.

And as there are fewer people making the cars, growing the grain and sawing the lumber, our GDP per capita shrinks.

And when we’re at that point, what’s the impact on your wallet?

  1. If you are not a baby-boomer, you will not lack for jobs in Canada and you should be able to negotiate the best salaries of your life.   For the first time in living memory, job-seekers will hold the bargaining power, structurally.
  2. You will pay the most taxes of your life to support the retired and the elderly who will continue to have high expectations, especially healthcare.  At the same time, services you use from the government will be reduced.  Put crassly:  it will pretty much suck.  The retirees will still hold the votes and have the time to be activists. Expect their wants to win, and yours to take a back seat.
  3. It will cost an arm and a leg, even more than currently, for skilled labour.  My advice?  Learn to fix your own stuff!

Take a look at the graphs below.   See the big clump that starts red|yellow|green|blue ? Take a look at how it’s slowly been moving towards the older age and retirement.  Slowly, but surely.

I took the following graphics from NationMaster, which I gather is a sort of Wikipedia.

Canada Population Pyramid for 2000

Age and sex distribution for the year 2000:

Canada Population Pyramid for 2003

Age and sex distribution for the year 2003:

Canada Population Pyramid for 2005

Age and sex distribution for the year 2005:

Canada Population Pyramid for 2010

Age and sex distribution for the year 2010:

Canada Population Pyramid for 2020

Predicted age and sex distribution for the year 2020:

Photo Credit:  Trevor Blake 

About the Author

Imagine if Canadians were known for being all over their money. Engaged. Proactive. Getting out of debt. Savvy. Saving. Generous. Nancy wants to help. Nancy started her own journey with money over 15 years ago, and formed her company “Your Money by Design” in 2004 to help others along the same path. It’s not the usual financial advising/investment stuff. It’s about taking control of day-to-day finances –managing monthly cashflow effectively, spending appropriately, getting out of debt, saving. If you're ready to take control over your finances, pop by her business site, YourMoneybyDesign.com


  1. et

    Do you have any suggestions how growth can be maintained indefinitely?

    Sure we may “suffer” from less production. But how could increasing production/population be maintained indefinitely? Sooner or later we are going to hit absolute limits to growth. It may be fossil fuel, clean water, arable land, or space that is the ultimate limiting factor.

    Too bad for us that it’s happening during our lifetimes, but given human nature and basic rules of growth it was bound to happen sooner or later.


    Nancy (aka Moneycoach) Reply:

    agree with everything you say.


    Aug 03, 2011
  2. Lori

    I’m not an HR or Labour Market expert by any means but I’ve heard anecdotal evidence that the prophecy of a rosy future for the Labour Market may not be so rosy.
    a) Boomers will not retire sooner but later because of better health and the devastating impact on their retirement finances (investment income) in recent years. They feel they have to keep working to sustain the lifestyle they want.
    b) Technology, Obsolescence, and Education. More and more positions are being digitized (automated) so there less need for human labour. Some industries are just disappearing because they are no longer relevant. As technology develops, the need for specialization and an ever higher level of education becomes greater. I am fully in favour of continuing education but a good education is expensive and time consuming. Heck, good technology is expensive and as the definition for ‘old’ keeps shortening (anything 5+ years is simply antiquated, according to some), I fear there is an ever-widening gap between those who can keep up with the e-Jones’ and those who are struggling just to make their basic monthly bills. Depending on the job you want, having the latest tech gear and knowing how to really use it can make or break your chances on being hired. Boomers are better placed, in some cases, to have the ready cash to buy the necessary gear.

    I don’t want to be a grumpy gus about the job future. I WANT to be positive and hopeful that there will be good jobs with good pay for lots of people. Am I just taking a few wild, gloomy tales and blowing them out of proportion? I would love to have your opinion, Nancy. Thanks.


    Nancy (aka Moneycoach) Reply:

    Those are definitely good points Lori, and potentially mitigating factors. But on the whole, I don’t think any of them will slow the trend much.
    a) Indeed some boomers will delay retirement, but vast swaths, esp those who have employer pensions (and that’s a massive number) will retire unless their circumstances are quite pressing.
    b) Canadians are doing quite well in their investments — I *think* Truth be told, I don’t have hard stats on that. But certainly the Cdn economy is doing well, as are Canadian companies and their stock.
    c) I’m not as convinced of your argument about technology. We’ve had technology and will continue to, for decades now. Unless the bulge of the currently employed folks who will be leaving the labour force could be replaced right now by technology, I think humans will be required to replace them.

    I do wonder how the US mess will affect us. We may find plenty of US folks wanting to come work in Canada. That would change the picture entirely.


    et Reply:

    The difference between “wanting to come work in Canada”, actually doing it and being allowed to work here is huge.

    For 100 people who say they’ll move, maybe 1 or 2 do. Last I heard immigration wait times from US were 2 years and counting.


    Nancy (aka Moneycoach) Reply:

    @et True. My hunch though is that the get-things-done (whether we like it or not) approach of the Conservative Party, if they stay in power next election, will be to open the gates to bring in more labour.

    Aug 03, 2011

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