Much Ado About the Great Retirement

September 28th, 2022 post featured image

Recently, we wrote a blog about how the Great Resignation in the US wasn’t necessarily translating north of the border and tied this into a discussion about how critical quality retention policy can be in dissuading employees from jumping ship.

Now, months later, we’re interested in discussing a problem Canada is facing… The Great Retirement. Census data from 2021 reveals that more than 1 in 5 (22%) working-age Canadians were aged 55 to 64 while 1 in 5 (19%) were aged 65 and older.

As a country, we have known and talked extensively about the impending silver tsunami of baby boomer retirements expected to eventually come to bear on our society. But it seems record high retirements are effectively ushering said exodus along.

According to an article from CTV news, historically high numbers of Canadians are retiring, even if they aren’t necessarily of what we would consider retirement age (65). Individuals in the 55-64 category are leaving after having consciously chosen to keep working throughout the pandemic. As if to make up for lost time, they’re leaving in droves to live their best, retired lives.

As predicted, highly skilled older employees are leaving faster than can be replaced by younger counterparts, despite Canada having “the largest working-age population, as a percentage of the overall population, in the G7” and ramped up immigration initiatives (which had been cut during the pandemic).

While exacerbated by the pandemic, this demographic dilemma isn’t set to get any better in the next decade, unfortunately, given Canada’s low fertility rates and the fact baby boomers are going to continue aging out the workforce.

An article from BIV, Business Intelligence for B.C. does manage to spot the silver lining, however. While baby boomers are certainly aging, their life expectancy exceeds that of previous generations meaning they could continue working past the standard retirement age of 65, if not out of financial necessity than perhaps just for something to do.

Of course, if someone is set on retiring, it’s possible there’s nothing an employer could say or do to convince them otherwise. But if there is a chance they can be swayed to stay with a company or possibly delay retirement until a replacement is found and trained, those options are worth considering and investing in.

One major shift employers could adopt now to curb the negative effects of a shrinking labour pool is respecting the value of senior employee skills and knowledge. It’s no secret many, many companies are letting their senior staff go in favour of younger employees (with lower salaries).

Baby boomers on the cusp of retirement may want to find a happy medium: continue working in their long-time role or company for less hours and less pay. Or they may want to try something completely different, in an unfamiliar industry. The point is employers should anticipate these possibilities and seek to modify their hiring and retention policies to be more inclusive. If, for example, a company only hires full-time employees, maybe there is a way to restructure and accommodate an employee only interested in part-time.

The pandemic forced us all to get creative and pivot in ways we likely wouldn’t have ever considered, and incredible things came out of that innovation. As the labour force continues to shift, we’re going to continue to be faced with unprecedented problems that demand to be solved in unconventional ways.

This means that while there may not be an existing model of how to accommodate older employee’s needs, best practice should be to listen to them and try to make it work. After all, the data tells us Canadian employees are not quite as replaceable as some employers would like to believe.

If you’re interested in any of the topics touched upon in this article – retirement, business ownership or succession planning – connect with us.