The evolution of the Canadian labour force continues to draw attention, as people born during the baby boom started to reach the age of 65 in 2011 and have progressively been leaving the labour market ever since to retire. These departures have exerted a downward pressure on the labour force participation rate, which reached its lowest level in 20 years in 2023, at 65%.
Despite the large number of baby boomers retiring, the labour force should continue to grow over the next two decades in Canada, partly because of migratory increase. A rise in the labour force participation rate, particularly among older workers, could also have a significant impact on the size of the labour force in the coming years.
These results are based on a new study, "Canadian labour force: What will happen once baby boomers retire? "
This study uses various population scenarios to examine the effects of different immigration levels and labour force participation rates on the size and composition of the Canadian labour force through 2041.
For this study, six scenarios were developed. The "reference scenario" assumes that recent trends in population growth and labour force participation will continue. This scenario acts as a point of comparison for all the other scenarios selected for this analysis. The five other scenarios differ from the reference scenario by just one assumption, altering either the permanent immigration level or the labour force participation rate by age group.
