COVER

THE COSTS OF AN AGING POPULATION

Susan McClelland July 9 2001
COVER

THE COSTS OF AN AGING POPULATION

Susan McClelland July 9 2001

THE COSTS OF AN AGING POPULATION

Susan McClelland

May Ebbitt Cutler started a new life—several new lives, really—after she turned 65.

In 1987, the founder of the children’s book publishing company Tundra was elected to a four-year term as mayor of Westmount, in greater Montreal. Since then, she has mounted theatre productions in Montreal, Detroit and New York City. She kept her hand in politics: the grandmother of six was deeply involved in Westmount’s battle against the Quebec government’s plan to merge Montreal with neighbouring municipal-

ities. She found time to travel abroad, to China, India and Brazil, among other destinations. And she has survived a battle with breast cancer. “I love being a senior,” says the 77-year-old Cutler. “I have so much freedom after raising a family for 35 years. I am happy to be alive and to be able to contribute.” While Cutler may not be typical today, she might well be the picture of tomorrow’s active senior. By 2021, an estimated 20 per cent of Canadians will be over the age of 65—up from 12 per cent in 1998. And these seniors will likely be living healthier and longer lives than any preceding generation.

But what will that demographic shift do to Canadian society? Some experts predict that more seniors than ever will be wealthy consumers of everything

from vacations to retirement properties. Others warn that the ill and poor in the elderly population will cripple Canada’s social systems. “When talking about an aging population, there is a tendency to be overly optimistic or to be apocalyptic,” says Michael J. Prince, associate dean of human and social development at the University of Victoria. “Both views tend to be exaggerated.”

Prince is particularly dubious about claims of great riches among future retirees. Many baby boomers will be cushioned by lucrative savings plans, but in 1995, only 35 per cent of tax filers purchased RRSPs, and although the contribution amounts have increased over the past decade, so, too, have pre-retirement withdrawals for reasons such as downpayments on homes. Prince also warns that the number of people with occupational pension plans has been declining since 1990, largely because of the trend towards corporate downsizing. Nowadays, less than 40 per cent of the labour force is covered by a company pension. “The reality,” says Rod Beaujot, a social policy and population expert at the University of Western Ontario in London, “is that many seniors will have to continue working. Retirement age may no longer mean 65, but 75 or even greater.” They shouldn’t have much trouble finding work. Experts foresee greater opportunities for older workers in parttime and flexible-schedule jobs. “There will be a tightening of labour markets, fewer employees, and companies will be looking for ways to attract back the older worker,” says Prince. “There is a

lot of corporate wisdom in a senior employee.” And some academics now play down fears over the impact on public pension plans. “The demands of an aging population won’t be anything we can’t handle,” says Lynn McDonald, a University of Toronto professor in the faculty of social work. “There will be fewer children to support, for one thing, and everything will balance out.” That’s a rosier view than other experts hold. They anticipate big bumps in the road ahead, particularly for health care. “There has been a tremendous increase in life expectancy over the past century, but it isn’t always healthy life expectancy,” says Réjean Hébert, scientific director of Sherbrooke, Que.’s Institute of Healthy Aging. “The challenge will be to compress the disability period pre-

ceding death.” This does appear to be happening with males, but not females, Hébert says. A recent Quebec health survey found that elderly men experienced poor health in the last four years of their lives, and women generally were in poor health for the last seven years.

Women are further disadvantaged on the economic front. Women who are 65 and over have the lowest average annual income of any age-group in the country at $16,000—which is $10,000 less than their male counterparts. Future female seniors may not fare much better. In 1997, the average annual salary of working women was $19,800, just 62 per cent that of men, a disturbing statistic given that pensions are salary-based. For some, it seems, the socalled golden years may not be so shiny.