(NC) -- We all know Canada's population is aging. But how will changing demographics affect your business?
First, the good news. Aging consumers have different buying habits, so that means opportunities if you're creative. The bad news is that as baby boomers retire, many businesses will face labour shortages because not enough younger workers will be around take their place.
Either way, businesses that don't adapt to the reality of the aging population could face severe challenges and are going to miss opportunities, says Pierre Cléroux, Chief Economist at the Business Development Bank of Canada (BDC).
The impacts are already being felt in some sectors and regions where businesses are struggling to find younger employees to replace retiring boomers. “If we don't manage our labour force according to the new trends, it's going to be difficult for businesses to be successful,” Cléroux says.
Retain older employees
In the next 20 years, the median age of Canadians is expected to rise to 45, up from 26 in 1991, Statistics Canada projects. Twenty years ago, nearly two people entered the labour force for every person nearing retirement. Today, the ratio is one to one, and it is expected to drop further.
Happily, Cléroux says entrepreneurs can take steps to adapt—and even find opportunities by reviewing how to adapt products and services to an older consumer's needs.
“Every sector of the economy is going to be impacted,” Cléroux says. To deal with the coming labour crunch, you can start by creating more accommodating workplaces to entice aging employees to put off retirement, he suggests. Older workers often can't or don't want to work full-time. Flexible hours, part-time jobs and temporary work are ways to keep them on board. Some companies also deliberately recruit seniors to fill labour gaps.
“Older workers usually have a great work ethic and experience,” Cléroux says. “Businesses will need to keep their people working for them longer. The perception is that at 65 people are done. That perception will have to change.”
Les MacIntyre is a firm believer in retaining older employees to make up for a shortage of younger workers at his company, Superport Marine Services. He has no mandatory retirement age and offers retirees flexible, part-time and temporary jobs. He also pairs them with younger workers to pass on skills. “Those guys pick up a wealth of expertise. The retired guys have the patience to pass on that knowledge. They bring a lifetime of skill,” he says.
MacIntyre also works hard to foster a positive workplace culture so retirees are eager to come back. “I try to instill a stimulating and satisfying workplace so they enjoy working here and I have a high retention rate.”
Immigrants are key
Another solution is immigration, which has always been important in addressing labour shortages in Canada, Cléroux says. That role will grow: 20 years from now, 32% of the labour force will have been born outside Canada, versus 21% today.
Cléroux says Canadian entrepreneurs will need to be more welcoming to foreign-born workers. “Businesses will have to be more flexible in accepting people trained, educated and born outside Canada.”
Creative changes will be needed to remain competitive, he adds. “We can no longer do the same things as in the past. The structure of the last 40 years is going to have to change. But if we do things correctly, we should be able to retain Canada's competitive position.”