In Canada, immigrant seniors often find themselves working longer than their Canadian-born peers. Recent data from Statistics Canada and the Royal Bank of Canada highlight a significant trend: immigrant seniors tend to retire later, frequently out of financial necessity. This article highlights the factors driving this phenomenon, examining the employment patterns among senior Canadians, with a particular focus on the differences between immigrants and those born in Canada.
Extended Work Life Among Immigrant Seniors
Statistics reveal that immigrant seniors in Canada typically retire at age 66, two years later than their Canadian-born counterparts. A higher proportion of immigrants over the age of 55 remain employed compared to native-born Canadians. This extended work period is often driven by financial needs, although some continue working by choice for personal fulfillment.
Employment by Choice and Necessity
The decision to continue working past retirement age varies between choice and necessity. Many seniors find it necessary to keep working due to insufficient retirement savings, ongoing mortgage payments, unforeseen expenses, or the need to support family members. On the other hand, some choose to work to stay active and engaged.
Data from the Labour Force Survey (LFS) in 2022 show that 21% of seniors aged 65 to 74 were employed, with 9% working out of necessity and 12% by choice. Immigrant seniors are more likely to work out of necessity compared to their Canadian-born peers. For instance, 15% of immigrant men aged 65 to 74 worked by necessity, compared to 9% of Canadian-born men. Similarly, 9% of immigrant women reported working by necessity, compared to 6% of Canadian-born women.
Factors Influencing Extended Employment
The reasons for seniors working past the age of 65 are complex and multifaceted. Financial preparedness is a significant factor. Many seniors, particularly immigrants, may not have sufficient retirement savings, prompting them to stay in the workforce longer. Housing status also plays a role; seniors living in rented dwellings are more likely to work by necessity compared to homeowners.
Marital status influences the necessity to work as well. Canadian-born and immigrant women without spouses are more likely to work by necessity compared to those who are married or in common-law relationships. The industry of employment also varies, with seniors working by necessity often found in sectors like manufacturing, retail trade, and administrative support.
Employment Patterns and Wages
Seniors working by necessity generally earn lower wages and hold less skilled positions compared to those working by choice. In 2022, immigrant men working by necessity were more likely to have full-time jobs but earned 25% less on average than those working by choice. This wage gap persists even after accounting for differences in education and job characteristics, suggesting other unobserved factors like worker ability and firm-specific pay practices may be at play.
Policy Implications and Future Research
Understanding the employment patterns of senior Canadians is crucial for policymakers and employers. As Canada’s population ages, encouraging the participation of seniors in the labor market can help mitigate the overall employment rate decline. This is particularly important as life expectancy increases and the nature of work becomes less physically demanding.
Future research should focus on the broader financial picture of seniors, including all sources of income and wealth holdings. Such research could provide deeper insights into the economic vulnerability of seniors working by necessity. Additionally, understanding the long-term impact of the COVID-19 pandemic on senior employment decisions remains an open question.
The trend of immigrant seniors working longer than their Canadian-born peers highlights significant issues of financial preparedness and economic vulnerability. While some seniors work by choice to stay active, a substantial number work out of necessity due to financial constraints. Addressing these issues requires comprehensive policies that support adequate retirement savings and provide opportunities for seniors to remain engaged in the workforce by choice rather than necessity.
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