Canada's real problem is not job losses, it's the rush to retire

OTTAWA, Sept 11 (Reuters): More than a year after the Great Resignation took hold in the United States, Canada is grappling with its own greyer version: The Great Retirement.
Canada's labor force grew in August, but it fell the previous two months and remains smaller than before the summer as tens of thousands of people simply stopped working. Much of this can be chalked up to more Canadians than ever retiring, said Statistics Canada.
It is not just the 65-and-over crowd packing up their offices and hanging up their tool belts. A record number of Canadians aged 55-64 are now reporting they retired in the last 12 months, Statscan data shows.
That is hastening a mass exodus of Canada's most highly skilled workers, leaving businesses scrambling, helping push wages sharply higher and threatening to further drag down the country's sagging productivity, economists say.
"We knew from a long time ago that this wave was coming, that we would get into this moment," said Jimmy Jean, chief economist at Desjardins Group. "And it's only going to intensify in the coming years."
"The risk you have, and in some sectors you're already seeing it, is that people are leaving without there being enough younger workers to take over. So there's a loss of human capital and knowledge."
During the pandemic, retirements fell as many Canadians decided to stay in their jobs longer. With restrictions now lifted, many are rushing to make up for lost time, choosing to travel and spend more time with family.
Their departures are shrinking the labor force, which could weigh on economic growth at a time when the central bank is aggressively hiking interest rates to counter spiking inflation, fanning fears that the economy will fall into recession.
Canada - which has ramped up immigration to help drive economic growth - has the largest working-age population, as a percentage of the overall population, in the G7, but at the same time its labor force has never been older, according to Statscan. One in five workers in Canada is 55 or older.
There were 307,000 Canadians in August who had left their job in order to retire at some point in the last year, up 31.8% from one year earlier and 12.5% higher than in August 2019, before the onset of the pandemic, Statscan said.