Canada can spur economic growth despite aging baby boomersStaff writer ▼ | March 12, 2015
Despite gloomy pronouncements from some analysts, Canada's aging population does not guarantee an era of slow economic growth, finds a new study released by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.
Study Adult unemployment in Canada at historically low levels
On the employment front, Canada's adult unemployment rate (5.8 percent) remains at historically low levels. With this low rate, rather than increasing or extending unemployment insurance benefits, governments could encourage the unemployed to move to jurisdictions with lower unemployment.
Among provinces, Ontario's plan to raise taxes and introduce a provincial pension plan has damaged its investment climate. And both Ontario and Quebec remain heavily in debt.
In the United States, policy uncertainty, including the Obama administration's dithering on the Keystone pipeline, creates uncertainty in Canada. But as the U.S. economy improves, Canada should benefit.
"Thanks to Canada's stable financial sector and labour markets, it's well-positioned to take advantage of an upturn in the U.S. economy. An improving economy south of the border will also help Canada overcome slumping commodity prices," Cross said.
"Canada's aging population, combined with the lingering effects of the '08 recession, has made some economic analysts unduly pessimistic about economic growth. But pro-growth policies work in any economic environment." ■