Wednesday, April 27, 2011

Will older workers solve the labour shortage?

Today the government of Alberta announced a new action plan for ensuring mature workers stay in the labour force longer as one way to address a projected labour shortage.

One of the compelling questions not addressed in the report is: do older Alberta workers, in any appreciable number, want to remain in the workforce past the average retirement age of 64 years (higher than the Canadians average of 61.9 years)?

According to Minister of Employment and Immigration Thomas Lukaszuk, yes they do: “Most mature workers want to stay engaged in the labour force in some capacity — maybe doing what they were doing all their lives but on a part-time or casual basis or changing careers altogether.”

But is it true?

There is no data in the action plan suggesting this is the case. Looking at some of the documents the action plan builds upon, a similar data gap emerges. For example, the 2008 Findings Report of the Demographic Planning Commission which talked to seniors had little to say about the desire of seniors to stay in the workforce beyond some motherhood statements and general handwringing about the cost of retirement.

The subsequent Aging Population Policy Framework (released in 2010) indicates a priority (under the general goal of ensuring Albertans have adequate financial resources for retirement) is to “Support Albertans who choose to remain engaged in the workforce in their senior years.” This is a laudable goal but again, we have no evidence about the degree of interest in working beyond the current retirement age.

Interestingly, the action plan does contain some information that ought to cause us to question the validity of the Minister’s statement. On page 20, the report notes: “A high percentage of older Albertans choose to continue working relative to the rest of Canada. 73.4% of Albertans aged 55-64 are active in the labour force compared to 61.9% of Canadians; and 16.5% of Albertans over age 65 choose to remain in the labour force compared to only 10.5% of Canadians.”

If we already have 50% more seniors working than the Canadian average, how likely is it that we can significantly increase this percentage? Have we, in fact, already tapped out this source of workers?

Again on page 20, the report notes: “In 2009, while the unemployment rate was 6.6% in Alberta and 8.3% across Canada, the unemployment rate for Alberta workers over age 55 was only 4.6% – suggesting that mature workers who choose to remain in the labour force are very likely to have employment. (p.20)”

Effectively, almost every older Albertan who wants to work is working. Again, is it likely that Alberta is going to significantly increase the number of older workers? Or is this pool tapped out?

I’m all for government intervention. But that intervention should be based on some credible case that the intervention will be effective. Obviously iron-clad proof is not possible, but how about something more than off the cuff speculation by the Minister that runs contrary to a common-sense reading of the data contained within the action plan?

-- Bob Barnetson

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