The growth rate among retirees claiming pension income is in decline
One of the issues of concern to people like me is the lack of personal savings in New Brunswick and the potential impact on the economy in the years ahead.
Like most provinces, historically many New Brunswickers could count on pension income but we know in recent years, the private sector has been moving away from offering formal pensions and even the public sector is slowly moving in that direction.
I have been looking through the 2010 Neighbourhood Income data from Statistics Canada and it looks like the growth in the number of persons claiming pension income crested in the mid 2000s. Until then, the number of persons claiming pension income was steadily on the rise. These are not large numbers (around 2,000 persons per year) but it is interesting. At the same time, the number of persons claiming the old age security income has been steadily on the rise and as of 2010 there were 1.5 new persons claiming OAS income for every one new person claiming pension income. Back in 2003, there was 0.75 new persons claiming OAS for every one new person claiming pension income.
This just confirms that more and more people are retiring (expected) while increasingly fewer of them are on formal pensions (anticipated).
This is likely going to get worse in the coming years and with low levels of both RRSP and investment income this will have ripple effects across the economy. It will push down the average income among seniors meaning less spending, less taxes and more hardship.
READING THIS CHART: This chart shows the incremental increase in persons reporting OAS and Pension income from 2003 to 2010. In 2010, a total of 88,140 persons claimed pension income and 119,290 claimed OAS income. See my column in tomorrow’s TJ for more details.