Who are the Baby Boomers?
In 1946 after the Second World War, Canadian men and women celebrated Europe’s liberation by starting large, prosperous and ambitious families. Over the next decade and a half, they would sire the children of the atomic age, the Baby Boom generation.
This generation would have better health care, education, resources, and opportunities than any generation that preceded them – it made them a generation of firsts:
- Ubiquitous access to mass media let them elevate cultural icons like The Beatles to global phenomenon
- Access to a 24/7 global economic network allowed them to create an unprecedented consumer culture
- Women entered the workforce en-masse and stayed working, adding to immense fiscal production
- Boomers stood on the front lines of the Civil Rights, Environmental and 2nd Wave Feminist movements
The Baby Boomers are, by every measure, the wealthiest generation Canada has ever experienced. They are currently 25% of our workforce, holding 50% of jobs with incomes over $60K. The Baby Boomers are also starting to retire.
Why is the Baby Boom Retirement a big deal?
There are currently 5.8 million Baby Boomers working in Canada. As of 2017, they are retiring at a rate of almost 210,000 per year. That rate will jump to 400,000 by 2020 and will not decline again until 2031. With Generation X and the Millennials already in the workforce, that leaves Generation Z – a cohort only 2/3 the size of the Baby Boomers – to provide the labour force to replace them. This has the potential to leave companies with massive skills, experience, and leadership gaps; creating a more competitive market for employees, much like Alberta experienced in the early 2000’s.
Though the retirement of the Boomers will have a profound effect on the labour force, we can safely bet that it will have broader implications for Canada in general. We can expect to brace for a few expected effects:
- Real Estate values in suburban areas will decrease while retirement communities and picturesque settings see price increases as the Boomers look to downsize from larger homes more suited to raising families.
- Regional demographics will experience significant shifts as the generation finds their ideal retirement locations
- Investment markets will see a decline as retirees start to cash in on their nest eggs
- Government tax revenue will decrease as working incomes transition to fixed incomes
- Government pension funds will decline rapidly as the largest generation in Canadian history access pensions at unprecedented rates
So, what now?
A great deal of planning and some seizing of opportunities. We will explore this further in our next blog: ‘Baby Boomers Are Retiring. What’s the Big Deal? (Part 2) ’.