Birth rates are dropping dramatically in B.C., and soon immigration won’t be able to fill the labour gap. Will local businesses get serious about creating kid-friendly work environments before it’s too late?
The boomer show is about to bust in B.C. Soon the curtain will open to reveal a slowly emptying set as the aging cast members are drawn offstage by retirement’s twinkling lights. We’re a province accustomed to dramas of many kinds, but this is a spectacle we’ve never seen before. And the question on the minds of spectators and stagehands alike is, Just how long can we keep the show on the road?
The boomers are still hogging the labour limelight in both B.C. and Canada, but in 2011, according to Statistics Canada, the percentage of the Canadian population that works will peak, then start to go down. As the first boomers reach age 65 in two years, the graceful shuffle we see now will break into a trot as record numbers of workers take their final bows.
By 2017, according to one Statistics Canada model, that trot will turn into a sprint, and in the decade from 2021 to 2030 “there will be a huge shrinkage every year,” says Brian Bemmels, a professor of labour relations and human resources at UBC’s Sauder School of Business.
In a typical year in that decade, about 540,000 Canadians will leave the workforce and 360,000 will enter, leaving a gap of about 180,000 people. “That’s large, really large,” says Bemmels. “To put it in perspective, as far back as we’ve kept statistics, the labour force has grown. We’re accustomed to progress, development and advancement, and a growing labour force is a key part of that.”
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The growth and stability of the economy depend on two things: the percentage of the population that works and the average worker’s productivity level. But soon businesses won’t be able to recruit or retain enough employees to remain viable nor find enough consumers for their products or services. There will be fewer taxpayers to fund everything from health care to business subsidies. According to Bemmels, “All long-term economic projections are affected, the economy might start to stagnate and we might lose our ability to be competitive.”
It’s a story playing out in most industrialized countries, and all provinces, but it’s particularly dramatic here in B.C. We have the second-lowest fertility rate in the country, behind only Newfoundland and tied with many countries in eastern Europe. U.S. women have an average of 2.09 babies each (about the rate needed to replace the population) while Canadian women have 1.59; B.C. women have just 1.40.
The rate has climbed slightly in the last few years because the front-end boomers’ children are having kids (the so-called boomlet generation), but their demographics show the uptick won’t continue. What will continue, however, is the aging of the labour force. By 2021 about one worker in five will be 55 or older.
So what do all these numbers add up to? On the upside, it means that, outside of recessionary times, unemployment will cease to be a concern. “I have two children; one is in high school and one is in university,” says Bemmels.
“Let’s put it this way: I’m not too concerned they’ll find jobs. As long as they’re good at what they do, they’ll have more options than they know what to do with.”
But for employers and social-safety-net administrators, the prospect of the old outnumbering the young presents an almost unmanageable situation. And currently, neither the provincial nor federal government is providing any real solutions. That is why some businesses are now turning office cubicles into cribs as a way of raising productivity, increasing profits, and attracting and retaining more workers both now and in the future.
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One company that has arrived at just such a solution is Syscon Justice Systems Group in Richmond, a software development company with 110 employees. Just over three years ago, one of its top employees returned to work after maternity leave and struggled to cope because of child-care arrangements. Several other employees told the CEO at the time, Floyd Sully, that they might have to resign since they were unable to find quality child care in the area.
Sully didn’t want to lose any of them, so he searched the surrounding community for child-care options but found very few spaces and none that seemed good. He decided to create an in-house child-care facility instead, consulting with Linda Reid, B.C.’s minister of state for child care, who told him that retrofitting or renovating an existing space to comply with regulations usually costs between $10,000 and $15,000. Sully hired a full-time child-care director and converted three tiny offices over a period of five weeks.
“Parents aren’t running in the door at 7:30, totally stressed out, throwing me the child and saying, ‘Oh, I’m so late,’ then calling me an hour later, crying, ‘Oh, I’m such a bad parent, is my kid OK?’ ” says Margaret McColm, the director of Syscon’s child-care centre, who has both early-childhood-education and infant-education certification and 20 years’ experience in non-workplace-based child care.
She says eliminating the morning and afternoon child-care-related stress and extra commute makes parents much happier and more productive. “Here they sit with their child in the morning and spend their lunch hour with them by the river. And if anything happens, they’re right down the hall; they don’t have to leave work and drive across town.” They also don’t have the panic of leaving work at an exact time in order to avoid being late for kid pickup.
Syscon president Dan Crawford says the child-care centre has had a “huge” impact on human resources, more so than providing perks with similar price tags such as a gym. “What does it cost to replace just one experienced, trained systems engineer? The recruiting, training and downtime when they are being replaced takes a really large amount of capital and potential productivity. So retaining just one employee is a very important investment.”
The centre means Syscon also has an advantage with recruitment. “People’s eyes light up when we tell them,” he reports.
“I have people who call all the time, desperate for child care,” says McColm, “and I say, ‘Well, you have to work for the company,’ then they say, ‘Well, what do you do? I’ll send a resumé.’ ”
Syscon’s solution is just one attempt to close the gap between women’s desire to work and their actual ability to go to work. It also addresses the gap between the number of children women want – on average 2.2 kids, according to Statistics Canada – and the number they’re having (1.6 kids).
According to Nathanael Lauster, an assistant professor of sociology at UBC who specializes in demographics and family, there are a few key reasons for this discrepancy. First, his research shows that when the cost of housing goes up, fertility goes down, and nowhere has that trend been more evident than in B.C. There’s also the fact that the list of “requirements” considered necessary to do a good job of parenting has changed from basics and hand-me-downs to thousand-dollar strollers, baby clothes that go out of style and specialty baby toys – a list that acts as birth control for some, because of the increasing price tag and environmental footprint.
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And then there’s the increased opportunity, financial and career costs of having children. It’s been well documented that the only thing that helps women choose kids – when it comes to choosing between having a career and having kids – is not having to choose at all. And the only way to create that situation, according to David Foot, professor of economics at the University of Toronto and author of Boom, Bust & Echo: Profiting From the Demographic Shift in the 21st Century, is to provide free or cheap, universal, quality child care.
He says that when governments do that, as they have in France and Quebec, they see fertility rates increase by a quarter point on average within a couple of years. In B.C.’s case, that could mean the rate goes from 1.40 to 1.65 children.
This is the broader societal solution – universal, cheap, quality child care – that many experts say would benefit not only families and children themselves but the economy as a whole. Introducing such a program would mitigate the labour decline in about 25 years by increasing the birth rate and would also have the immediate effect of increasing women’s participation in the workforce. Most women want to spend the first 12 months with their babies, but after that many who would like to return to work either full- or part-time can’t, due to child-care challenges.
“To keep people in their 20s, 30s and 40s, in the prime of their working age, in the labour force would be a very good strategy,” says UBC’s Bemmels.
While the main reason to provide our youngest citizens with quality, stimulating care is to help them lead happier, more fulfilled lives, it also helps the economy’s bottom line, boosting potential workers’ productivity – which would also ease the coming labour shortage because we’d need fewer workers.
“Cost-benefit analyses of early childhood interventions have shown, in different settings, that the returns of early childhood education and care can be as high as $8 for every $1 invested,” reads a recent UNICEF report. Right now, however, Canada lags far behind its fellow rich nations in the care and education of its young children, according to UNICEF. Of 25 economically advantaged countries, Canada scored at the very bottom, behind even Mexico.
So why is Canada so neglectful of its young when we’re known for our strong social welfare system? According to Foot, it’s all politics. “In the 10 years leading up to the Harper government, there were lots of negotiations around quality child care, including all the provinces, and the deal was pretty much struck. Harper nixed it completely,” he says. “Harper and his people believe women should stay home and look after children.” The irony of such a world view, however, is that it means fewer women have kids, so even fewer stay home.
As for the B.C. government, “We are very committed to quality child care,” says Linda Reid. The Early Childhood Learning Agency is releasing a report about the feasibility of full-day, fully subsidized kindergarten for five-year-olds, and Reid says the government is interested in extending early childhood education in elementary schools to four-year-olds in the future, then, eventually, to three-year-olds. But the report comes with no policy implications, and there are no plans in the works to realize either idea.
The provincial government currently spends $300 million a year on child care. Of that, $140 million goes to subsidizing child care for B.C. families with incomes below $38,000 a year, which means 50,000 children benefit in some way from the subsidies. But given that there are about 246,000 kids under the age of five in B.C., and that most of the subsidies are only partial, only about one in five families gets any help at all. And given that child-care costs can run as high as $1,400 a month in urban centres, that cost can act as a kind of birth control, even for families with incomes over $38,000.
Foot says that to be effective in raising fertility rates or providing quality education, which benefits society as a whole, a child-care policy needs to reach everyone and be subsidized at the point of entry, such as in Quebec, where for $7 a day, any parent can enroll their child in child care. At present, no such policy is being proposed by the B.C. government.
[pagebreak] Historically, immigration – not child care, not finding ways to increase women’s participation in the workforce – has been seen as the answer to Canada’s labour shortages. Ever since the height of the baby boom in 1957, when the fertility rate soared to 3.91 children per woman, Canada has been steadily raising immigration rates. But now it’s clear that, while keeping rates high is essential, immigration alone won’t be enough, especially over the long term.
“We’ve already been trying to open up the immigration policies more in the last few years due to what’s been happening with our population growth,” says UBC’s Bemmels. “But if you look at what’s happening in India, China, Africa – countries we look to for immigrants – right now they have excess labour. But if they develop over the next few decades, they’ll have more labour demand.”
And that means fewer people emigrating. Besides, our current approach of poaching the most highly trained and highly skilled workers “isn’t necessarily fair,” Bemmels adds. “Countries like China need people like doctors as well, probably more than we do.” And if a country makes it more appealing for its most needed, skilled workers to remain at home, that would leave us with an even greater shortage.
The UN’s most recent report on world fertility shows that rates are actually down in almost every country. “Whether there will or won’t be enough people to immigrate in the future is a harder question to answer,” says Bemmels, but it certainly means Canada shouldn’t count on an endlessly increasing supply of new, skilled workers that magically appear on our doorsteps when and where we need them.
If immigration isn’t the solution, extending the retirement age won’t be the magic bullet either. Demographers recently thought it would provide an interim solution, and, to that end, the Canadian government abolished mandatory retirement last year and stood poised to evaluate the effects. But Statistics Canada reports that the current retirement age is actually closer to 62 than 65.
Seems people aren’t retiring because they have to, but because they want to. Bemmels refers to Ontario’s recent example: “When they did away with mandatory retirement, universities were concerned that their faculty wouldn’t retire at all. It turned out that only four per cent of faculty kept working past 65, and even then only for four additional years. . . . Most people don’t want to keep working, so I’m not optimistic that relying on older workers will be a solution.”
Which gets us back to birth rates. Raising fertility levels is not a simple matter of master planning. Like any threesome, getting involved in baby making is a highly problematic proposition. For one thing, women aren’t population machines, here to prop up a dwindling workforce and ailing economy or to provide prospective taxpayers who will support us in our retirement.
For another, population growth is arguably the greatest problem facing the environment. Trying to boost the economy by raising the fertility rate is kind of like trying to boost the economy by getting everyone to buy an SUV. It would solve the short-term problem but eliminate the long term altogether.
But there might be another solution: increasing the birth rate slightly, then raising those kids in a slightly new way. “There’s a magic number of 1.5 to 2.5 babies per woman that works,” says Foot. “Any less than that and your economy and society start to suffer – and more than that and the environment does.”
While there’s a widespread perception that the problems associated with overpopulation (namely, a drain on the Earth’s resources) are mostly due to high fertility rates in developing countries, “it’s actually the exact opposite,” according to UBC’s Lauster.
“A single Canadian’s average lifestyle consumes far more resources and has a far greater environmental impact than a whole family from the Congo,” he notes. “Having children isn’t the problem; it’s the lifestyle we have recently come to think we need in order to raise children and the lifestyle we bring them up to lead.”
We need some fresh thinking about this business of raising babies – including the ways in which parents, schools, governments and companies get involved in a child’s rearing. If we really want to increase our personal well-being, skill levels, productivity and overall economic strength, we’ll need private solutions such as Syscon’s in-house child care as well as bolder solutions such as universal child care. We’ll need to think about the health of our families, our businesses and our economy as being interrelated and interdependent.
“The answer is to keep having kids but to start raising them differently, more responsibly, in an ecological and social sense,” says Lauster. If we can do that, we’ll go a long way toward solving the twin economic and environmental crises that loom.
