An Oldie but A Goodie: Economic and Fiscal Implications of an Aging Population

Population aging will have profound effects on Canada’s economic prosperity, public finances, and the quality of healthcare we can provide. In this note, we discuss some of those impacts and the challenges they will create for the federal and provincial governments.

The aging of Canada’s population is well known and long predicted. Though high immigration levels and skyrocketing non‑permanent resident admissions have helped slow the process, alone, they won’t be nearly enough to stop the rapid acceleration expected over the next decade.

Canada’s provinces will bear the brunt of the costs of an aging population. Current health spending plans likely won’t meet the needs of an aging population, and we estimate that meeting those needs could cost an additional $2.5–5B in each of the four largest provinces by 2030.

In this challenging environment, governments will need to increase the Canadian economy’s productive capacity and find new, more efficient ways to deliver healthcare services. Look for more analysis on healthcare and aging from Desjardins Economic Studies in the coming months.