Demographic Shifts and Labour Force Participation Rates in Canada
In: A Symposium on Canadian Labour Force Participation in the 1990s (Special Issue of Canadian Business Economics, Volume 7, Number 2, May 1999)
AbstractLabour force participation rates vary greatly by age, with persons 55 and over having much lower participation rates than younger persons. Consequently, changes in the demographic composition of the population can exert a long-run effect on aggregate participation rates. In the third article of the symposium, Bob Dugan and Benoît Robidoux examine the impact of demographic shifts on labour force participation in Canada. They use an accounting framework and plausible trend participation rates for 16 demographic groups with source population estimates to estimate an aggregate structural participation rate for Canada. They find that the ageing of the population has already started to exert downward pressure on the aggregate participation rate in Canada due to longer life expectancy and the resulting growing proportion of the population in the low-participation rate 65 and over age group. The movement of the baby boom generation into the 65 and over group in coming years will intensify this trend. Between 1989 and 1997 they find that the demographic composition effect reduced the aggregate participation rate by almost 1 percentage point, and that from now to 2030 it will reduce the participation rate by an additional 8.5 points. Of course, greater than expected trend increases in labour force participation rates by older age groups could offset some of this composition effect. The authors point out that changes in demographic composition had virtually no effect on the participation rate in the 1990s in the United States as the share of the population 65 and over was stable. This situation reflects the fact that the United States became an “older” society earlier than Canada due to an earlier and smaller baby boom and a higher average age for immigrants. Dugan and Robidoux calculate a trend participation rate of 66.2 in 1997, 1.4 percentage points above the actual rate of 64.8 per cent. Based on this rate they conclude that about one half of the 2.7 point decline in the participation rate in the 1990s was structural and one half cyclical.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
This chapter was published in: Andrew Sharpe & Louis Grignon (ed.) A Symposium on Canadian Labour Force Participation in the 1990s (Special Issue of Canadian Business Economics, Volume 7, Number 2, May 1999), Centre for the Study of Living Standards, pages 42-56, 1999.
This item is provided by Centre for the Study of Living Standards in its series A Symposium on Canadian Labour Force Participation in the 1990s (Special Issue of Canadian Business Economics, Volume 7, Number 2, May 1999) with number 04.
Find related papers by JEL classification:
- J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
- J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
- E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution
- O51 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- George J. Borjas, 1991.
"Immigration Policy, National Origin, and Immigrant Skills: A Comparison of Canada and the United States,"
NBER Working Papers
3691, National Bureau of Economic Research, Inc.
- George J. Borjas, 1993. "Immigration Policy, National Origin, and Immigrant Skills: A Comparison of Canada and the United States," NBER Chapters, in: Small Differences That Matter: Labor Markets and Income Maintenance in Canada and the United States, pages 21-44 National Bureau of Economic Research, Inc.
- Paul Beaudry & Thomas Lemieux, 1999. "Evolution of the Female Labour Force Participation Rate in Canada, 1976-1994," CIRANO Project Reports 1999rp-02, CIRANO.
- Xiujian Peng & Yinhua Mai, 2013. "Population Ageing, Retirement Age Extension and Economic Growth in China A Dynamic General Equilibrium Analysis," Centre of Policy Studies/IMPACT Centre Working Papers g-237, Victoria University, Centre of Policy Studies/IMPACT Centre.
- Evridiki Tsounta, 2006. "Why Are Women Working so Much More in Canada? An International Perspective," IMF Working Papers 06/92, International Monetary Fund.
- Xiujian Peng & Dietrich Fausten, 2006. "Population Ageing And Labour Supply Prospects In China From 2005 To 2050," Development Research Unit Working Paper Series 16/06, Monash University, Department of Economics.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Whitney Hamilton) The email address of this maintainer does not seem to be valid anymore. Please ask Whitney Hamilton to update the entry or send us the correct address.
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.