FREDERICTON – Atlantic Canada will become the Third World of the 21st century unless provincial governments immediately get to work on population growth, predicts the Atlantic Institute for Market Studies.

Ian Munro of the right-leaning think-tank said Thursday it’s crunch time in the region in terms of addressing the population challenge.

Atlantic Canada’s population levels have been stagnant in the last few years thanks to low birth rates, constant out-migration and difficulties in attracting and keeping immigrants.

“This is the fundamental policy issue for the region, if not the country,” Munro said in an interview.

“Unless we do something to make changes, we face two options. One is that the public services of the future will be lessened … or, alternatively, the tax impact on the working population will have to be higher. Either way, it means a lower standard of living.”

More than 37,500 Atlantic Canadians moved to another province or territory between 2005 and 2006, while about 27,000 people moved into the region from other parts of Canada.

That’s a net loss of more than 10,000, and it represents a trend Statistics Canada predicts will continue.

Births and immigration appear to have picked up the slack, with the region’s overall population virtually unchanged. However, it’s clear the four Atlantic provinces, which are already facing a crisis in their aging workforces, are failing to draw enough people into the region.

In New Brunswick, Premier Shawn Graham – in office for just over a year – is promising to boldly address the problem.

He is pledging to implement policies with the goal of increasing New Brunswick’s population by 100,000 in the next 20 years.

“Population decline is the biggest issue facing our province today,” Graham said in a year-end interview.

“We have an aging population and we need to maintain a workforce that’s able to produce a tax base to pay for our social programs such as health care and education.”

Munro said Atlantic governments are mired in policies dating from the 1970s, when the big problem in the region was high unemployment – too many jobs and not enough workers.

He said that’s reversed now – there aren’t enough workers for the jobs and big changes will have to be made.

He said the region should scrap all mandatory retirement policies.

“It’s a no-brainer,” he said.

“People are going to have to accept that 65 isn’t when we’re all going to be able to retire and count on pension benefits in the future. We’re all now living to be, on average, 80 or 85 rather than 70 or 75 as it was decades ago. With that extension in lifespan, we may have to look at an extension in the working lifespan as well.”

Munro said the region will also have to start bringing under-employed groups into the workforce, such as aboriginals and people with disabilities.

Munro, an economist with the market institute, believes there will have to be wholesale tax changes and a new attitude towards child care to encourage more women to work.

He’s also calling for an end to pork-barrel politics that have led to economic development based on political favouritism and short-term electoral gain.

“We’ll have to accept that some plants will shut down and some towns will lose people,” he said.

“There will be adjustments as people move to where the best opportunities lie.”

To read Crunch Time: Population change will challenge Atlantic Canada’s future, click here.