Wave of retirements leading to labor shortages in health care and education

A surprising number of workers under 65 are taking early retirement

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TORONTO — Canada is facing a wave of retirements driven by workers in high-pressure sectors, with increasing numbers of people retiring before the age of 65.

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A new analysis of labor force survey data by the Canadian Center for Policy Alternatives (CCPA) found that 73,000 more people retired in the year ending August 2022 compared to the previous year. previous year, a jump of 32%.

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Two-thirds of these excess retirements were in four sectors: health care, construction, retail, and education and social assistance.

Senior Economist David Macdonald said it was highly unusual to see retirements at this level. But a closer look at some of the industries in question paints a picture of burnout, stress and ongoing pandemic hardship that is pushing workers to retire earlier than they may have planned.

While retirements are expected to gradually increase as baby boomers retire, 2022 sees a sharp spike, Macdonald said.

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“It’s very focused on certain specific areas, which makes it a short-term trend,” he said.

The wave of retirements started earlier in 2022, Macdonald found. By April 2022, healthcare retirements in one year had almost doubled, with 19,000 excess retirements over the previous year.

That likely means there’s a wave of highly skilled nurses leaving the profession, possibly due to burnout after two years of the pandemic, Macdonald said.

Canada’s most populous province is also driving the wave of retirements, accounting for 66% of additional retirements in the year ending August, despite having fewer 40% of Canadian workers. Teachers retired en masse; two-thirds of additional education retirements occurred in Ontario.

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Teaching retirements drove the trend in the year ending August; 21,000 of the 73,000 additional retirements were in education services.

Wage increases in Ontario’s public sector have been restricted by Bill 124, which could be a factor in health care and education workers deciding they’ve had enough, said McDonalds.

“There is a breaking point,” he said.

“These trades have not returned to normal. They are significantly different from what they were in 2019.”

In the year ending June, additional retail retirements peaked at 13,000 additional workers. In July, it was construction that boosted retirements.

It’s not just the baby boomer generation contributing to this wave either. A surprising number of workers under 65 are retiring early, Macdonald said.

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In August 2021, the largest age group retiring was between 65 and 69, accounting for 38% of total retirements. A year later, this group accounted for 33% of retiring workers, while the second youngest group of workers aged 60 to 64 had increased by three percentage points to 31%. Retirements of workers aged 55 to 59 have also increased.

« People retire, not because they turn 65, they retire for some other reason, » Macdonald said.

There was also a wave of retirements at the start of the pandemic, as many workers decided to take early retirement instead of going through unemployment, he said.

If Canada goes into a recession, something similar could happen in certain sectors, like finance or real estate, Macdonald said.



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