Lost generation? Exodus of youth presents ‘scary’ challenge on aging East Coast

HALIFAX — Scott Wetton stares at a graph that depicts a grey-haired future in Atlantic Canada, shakes his head and says, “That is scary.”

The graph produced by the Atlantic Provinces Economic Council shows how the East Coast will become what one economist calls “a canary in the coal mine” for the country’s coming era of labour shortages, unless there are big increases in immigration or the birth rate.

Wetton, a 23-year-old engineering graduate form Dalhousie University, and his classmate Jacqueline Poushay, 24, are packing up their possessions and moving west, a move that is common among their generation.

By 2031, the council says there will be 671,000 East Coast residents over the age of 65 – almost double current levels – while the number of people aged 40-49 plummets by 80,000 people.

“Without the middle-aged people paying for those older people, how are we going to keep our hospitals funded? How will we pay for this?” asks Wetton.

Atlantic Canada is grappling with a potent combination. It is suffering an exodus of its young people during a time when there is a Canada-wide demographic trend of retiring and aging baby boomers.

Some economists say Canadians should see the region’s challenges as an early signal of what an aging country will face, and the response may provide some answers for the rest of Canada.

“We are an early warning system for the country,” says Donald Savoie, a professor at the University of Moncton who has followed and written about the region’s economic development for three decades.

Atlantic Canada must increase immigration, find ways to recruit and retain young workers, and plan for a big hike in its health-care bill, he argues, or “there will be a day of reckoning” when basic services won’t be available.

Brian Lee Crowley, President of the Atlantic Institute for Market Studies, says the region faces a challenge as it adjusts to a new world of labour shortages.

“We are a canary in the mine, yes,” he says.

Crowley, who is working on a book about Canada’s coming demographic shift, said he’s found that twice as many Atlantic Canadians as other Canadians are migrating to other provinces.

“The big challenge for our economy will no longer be how do we warehouse these workers we don’t know what to do with, but instead, how do we encourage people not to retire and to upgrade their skills?” he says.

While various groups agree on the problem, they differ on the solutions.

Unlike the past 40 years, Crowley argues Atlantic Canadians must not expect higher transfer payments as “compensation” for the difficulties facing the region.

“If we pursue our usual strategy, which is to say that we are victims and it is all Alberta’s fault for luring away our young people and there is nothing we can do about it … we will only cause our decline to accelerate and we will not offer a model of anything except of how not to do things,” he says.

But New Democrat MP Peter Stoffer, who represents the Halifax-area riding of Sackville-Eastern Shore, says Ottawa needs to play a central role in helping the region cope with the demographic crunch.

If federal transfer payments based on population levels decline and basic services like health or daycare fall apart, then Stoffer says the out-migration trend may worsen as young families flee.

He also suggests there are opportunities in having an older population.

“There’s job training needed for the future. … We could become a centre of excellence for geriatric care,” he says.

The recent analysis released by the Atlantic Provinces Economic Council – which was based on Statistics Canada data – says there has been a net loss of about 72,500 people to other parts of the country over the last decade. In 2006, Atlantic Canada’s population had dropped by more than two per cent.

Studies show a large percentage of those leaving Atlantic Canada are young and well educated.

The long-term trend is hard to stop for simple financial reasons, even among students like Jacqueline Poushay, who professes a love for the East Coast’s gentle scenery and ocean vistas.

“My heart is in Nova Scotia,” she says as she gets ready to pack for an environmental engineering job in Calgary that pays about $70,000 a year, about double her best offer in Nova Scotia.

The native of Sydney, N.S., says as young people migrate and become established, their siblings follow, increasing the migration.

“I’ll be the first in family to move out West, but now that I’m out there, my sister is coming out this summer to be with me,” says Poushay. “I have another sister in the nursing program at Cape Breton University and she’s already said ‘When I’m done, you guys are out there and I don’t want to be by myself.’ “

Savoie says the most notable feature about the latest statistics is they show a sustained trend, unlike shorter bursts of departures in the 1970s and ’80s.

“In the past we had some peaks and valleys when it lasted for a year or two, what we’re seeing now is more sustained,” he said.

Areas where out-migration has been among the heaviest, including Newfoundland and Labrador and New Brunswick, may soon become regions in the greatest need of workers as large energy and mining projects come on stream.

The economic council study notes that Newfoundland and Labrador has felt the loss of workers most acutely, with a net loss of 42,000 people over the last decade.

With a surge in revenues from the oil and gas industry, the province needs workers.

Writing in Atlantic Progress magazine, economist Wade Locke recently estimated that a series of mining and oil projects in Newfoundland and Labrador could create 15,000 jobs by the first three months of 2010.

“The province is becoming a smaller scale or an earlier version of Alberta, at least in terms of its prosperity,” wrote Locke, a professor at Memorial University in St. John’s, N.L.

Jack Mintz, an economist at the University of Calgary, argues there is little cause for panic and Atlantic Canada may actually benefit from its demographic loss.

“You have all this oil and gas and mining. All of these things are there with fewer people. You become wealthier on a per capita basis,” he says.

Mintz says higher Western wages are countered by high housing costs, and many workers from Atlantic Canada are merely commuting back and forth, carrying cash home.

“It’s not necessarily all negative for the Atlantic in that unemployment is down and wage rates are going to have to go up,” he says.

The Atlantic Provinces Economic Council’s report also notes that Newfoundland and Labrador, New Brunswick and Nova Scotia gained more people than they lost over the last six months of 2007, though researchers are still waiting to see if that will become a permanent reversal.

Part of the possible turnaround rests on whether young engineers like Poushay choose one day to return to have a family in the Maritimes, and help build her profession.

But there is no guarantee she will return.

“The West is where I’m going to meet somebody and start a life,” said Poushay. “When you move into a neighbourhood and make friends, it gets a lot harder to uproot yourself and come back.”