Over the forecast horizon (2004-13), changes in the size and structure of the population will impact the employment outlook in three major ways.
- First, the purchasing decisions that consumers make will help to determine where the jobs are in the economy. These spending choices are highly contingent upon the age structure of the population. As they change over the projection period, so will the industries and occupations employing the workers.
- Second, the changing age structure will lead to shifts in government spending patterns. For example, the aging of the population is expected to cause a shift in dollars spent from the education sector to the health sector, which provides more services to older citizens.
- Finally, the aging of the population will also affect the existing labour market through the aging of the labour force and through a resulting increase in the number of retirements.
The Canadian population will continue to increase, but at a slower rate...
The Canadian population should rise steadily from 31.6 million in 2003 to 33.2 million in 2009. This sluggish growth, which is projected to slow down from an average annual rate of 1.0% between 1999 and 2003 to 0.8% between 2004 and 2008, is largely caused by a decline in the natural increase of the population. Immigration will thus play an increasingly important role in Canada's demographic growth.
- With persistently low fertility rates, in addition to an increase in mortality, the natural increase of the population (births12 minus deaths13) is declining. The natural increase is expected to decline from 103,900 individuals a year in 2003 to 66,000 in 2013, thus contributing to an increase of only 0.2% in the total population at the end of the period.
- Immigration has become a significant contributor to population growth in Canada. Over the past 10 years, the immigration rate has averaged 0.73% of the population each year. Net international immigration (immigration minus emigration) is expected to increase from 164,200 individuals a year in 2003 to 190,330 by 2013. While the contribution of immigration to population growth is projected to remain relatively stable over the 2004-13 period (0.6%), it is projected to account for nearly 75% of the population increase by 2013.14
...and this will have an impact on the source population and on the labour force
The decline in the natural increase will have the direct effect of slowing down the growth of the labour force source population (individuals aged 15 years and over) over the next decade. That growth is expected to decrease from 1.3% over the 1999-2003 period to 1.2% over the 2004-08 period, and to 1% over the 2009-13 period.
Labour force growth is expected to decrease from 2.0% over the 1999-03 period to 1.2% over the 2004-08 period, and to level off at 0.9% over the 2009-13 period. The overall participation rate is projected to remain essentially unchanged over the next five years at 67.5% as the greater participation of older people is muted by the aging of the workforce. Over the longer term, the latter development is expected to cause a drop in the overall participation rate as older people tend to participate less than core-age people. The participation rate is projected to decline beyond 2009, reaching 67.1% by 2013.
- 12The number of births is based on three factors: (1) the fertility rate (set at 1.5 children per woman); (2) the average age of mothers at the birth of their first child (steady at 29.0 years); and (3) the population of women of childbearing age.
- 13In terms of mortality, higher living standards and medical advances are expected to continue increasing life expectancy, but at a slower rate. The life expectancy of women was 81.4 years in 1996 and is expected to rise to 84.8 years by 2046. The life expectancy of men was 75.5 years in 1996 and is expected to rise to 80.9 years by 2046.
- 14Based on constant immigration and emigration rates of 0.75% and 0.19%, respectively, throughout the projection period.
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