Financial pressures, including covering basic expenses without pension support, are forcing over half of Canadians aged 60 and above to stay in the workforce, reveals data from Statistics Canada.
70-year-old James Kadri, an employee at a Calgary grocery store for 35 years, is a typical case. With rising inflation and escalating prices, Kadri depends on his grocery store job and two additional part-time positions to keep him afloat. “Without my evening job, I’d be in financial ruin,” Kadri admits.
The 2022 Labour Force Survey highlighted the major reasons older Canadians like Kadri are working longer – mounting essential expenses and absence of pension eligibility. Remarkably, retirements among Canadians aged 55 to 64 dropped last year compared to its preceding year.
The economic hardships are evident in Kadri’s life. With a transformed line of credit into a mortgage and an additional home mortgage, Kadri spends $1,000 bi-weekly on repayments. While he receives approximately $1,200 monthly from Old Age Security and the Canada Pension Plan, it’s insufficient without the stability of regular, full-time employment.
Bill VanGorder, COO of the Canadian Association of Retired Persons (CARP) and a retiree himself, acknowledges this trend. Since his retirement at 63, VanGorder has engaged in multiple full-time roles due to economic pressures. He points out, “People are short of retirement savings and pension plans.”
VanGorder also emphasizes the role of rising inflation, especially for low-income seniors, stating, “Support from the government hasn’t kept pace with the rapid inflation.”
Further complicating matters, older Canadians are now more indebted. Economist Giovanni Gallipoli of the University of British Columbia noted that senior citizens today have much more mortgage debt than their counterparts decades ago. “It was common for older individuals to be debt-free by their retirement during the ’80s and early ’90s. However, today’s easy access to credit has altered that,” Gallipoli added.
Changing societal patterns, such as extended education periods and increased life expectancies, also contribute to delayed retirements. Interestingly, a recent survey by Angus Reid Group suggests that even younger Canadians anticipate extended working lives, with many planning side jobs post-retirement to manage living expenses.
CARP has been advocating for government reassessment of the financial aids available to retirees. Responding to CBC’s inquiry, a representative from the Office of Canada’s Minister of Seniors confirmed the government’s efforts to aid economically stressed seniors. They highlighted the recent boost to the Guaranteed Income Supplement earnings exemption as a measure in this direction.
Meanwhile, despite enjoying interaction with customers, Kadri remains uncertain about his retirement prospects. With two mortgages weighing on him, Kadri dreams of a day when he can leisurely enjoy a coffee or go jogging without financial worries.