Labour shortages, inflation, longer life expectancy, a simple desire to stay active . . . there are various reasons why people choose to continue working or to return to the workforce. However, it’s common belief that doing so is just not worth it financially. Myth or reality?
Let’s go over some related issues with Luc Godbout, tax advisor and Chairman of taxation and public finance at Université de Sherbrooke.
His first observation? The employment rate for 20-59-year-olds is higher in Quebec. For the 60-64 and 65-70-year-old age groups, however, there is a significant drop and gap. “In Quebec, people retire a little earlier than in the rest of Canada.”
The phenomenon is amplified by two factors: “Quebec had a more pronounced baby boom than other provinces.” As such, in the 80s and 90s, in anticipation of employment obstacles for future generations, successive governments encouraged baby boomers to move up their retirement—with the average retirement age dropping as low as 58.4 in 1990!
Another factor affecting retirement age is the unionization rate: “Generally speaking, their retirement plans are more beneficial to early departures than for other workers. This is true everywhere in Canada, but even more so in Quebec,” Godbout says.
How can we turn this around?
According to Godbout, by bringing workers back to the workforce and delaying their retirement. But it needs to be profitable!