A short of history of retirement
A recent Canadian Labour Force Survey showed a surprising statistic -- employment among workers 55 and older has grown faster than that among workers ages 25 to 54.
It's the latest in a long line of signs suggesting that the idea of retirement is evolving and that the marketing slogan "Freedom 55," which has become part of our national lexicon, may soon be obsolete.
"There is now growing uncertainty about retirement -- how and when it might happen, and what form it might take," writes pension expert Monica Townson in her book Growing Older, Working Longer: The New Face of Retirement published by the Canadian Centre for Policy Alternatives. "All the signs are that Canadians don't want to work longer. Ultimately, many people may not have much choice in the matter."
Paving the way
Retirement and pensions aren't the same thing, but unless you're
one of those increasingly rare birds -- a Canadian with savings
-- they're strongly linked.
The modern pension system originated in 1889, when Otto von Bismarck created the first public pension as a move against rising socialism in Germany. Although Bismark's pension was considered generous in its day, the fact was that with payout after the age of 70, only one-quarter of the population lived to collect since the average German lifespan was about 40.
"Retirement is a relatively recent invention," says University of Calgary sociology professor Daniel Beland. "Before the 20th century, it was only a small elite of people who retired. Canada was a largely rural country and people simply continued to work. Perhaps they might slow down due to age or ill health and family would take on more. Retirement was more of a fate, not a choice."
This started to change in a small way with the introduction of employer-sponsored pensions early in the 20th century. These were for industrial workers and covered only a small percentage of the population. As well, there was no entitlement -- they were offered at the whim of the employer. "They were not guaranteed," says Beland. "If the company closed, there might not be a pension. It was a gamble."
Alongside its neighbour to the south, the Canadian government entered the pension fray with the introduction of the Old Age Pension Act in 1927. The program provided benefits at age 70 but was really more of a social assistance scheme, means-tested for poor Canadians. "They often didn't spend much time in retirement, because life expectancy was much lower then," writes Townson.