Models of aging: How Japan, Denmark, Germany are riding out their senior wave

Declining fertility rates have combined with increased life expectancy to create a Canada in which there are more seniors than children 14 and younger.

And projections released by Statistics Canada Tuesday show that gap will only increase over the next 40 years, leading to slower economic growth and a growing demand for social support, demographics expert David Foot says.

Policy-makers could consider Tuesday's news awake-upcall, although the University of Toronto economics professor said these trends have been ignored for decades.

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"With that massive baby boom generation now entering their late 60s, inevitably, they're going to start" to retire,Foot said. "We're going to have slower workforce growth and that will affect the economy."

Still, Canada remains the second-youngest ofthe G7 countries, meaning that there's time to learn from the policy successes and failures of these other nations.

The oldest country:Japan

More than a quarter of Japan's citizens are at least 65,makingit the world's fastest aging country.In Canada,about 16.1 per cent of us are seniors.

Right now in Japan,there's a higher demand for adultdiapersthanchildren's diapers, economist MichaelMoffattsays, a "stunning statistic" that illustrates one of the main reasonswhythe country's economy has been treadingwater for the better part of two decades.

"They haven't been able to find a way to get their economy to grow in a significant way while still being able to support an older population,"the RichardIveySchool of Business professor said.

Japan's GDP has grown at an average rate of 1.3 per cent for the past 25 years, according to the World Bank, dropping from averagesof more than fiveper cent annual growthin earlier decades.

Some of that sluggishness has been attributed to a shrinking labour market. AlthoughJapanhas offered incentives to encourage women towork, they are traditionally expected tostay home and care for aging relatives.

"So that also slows down the amount that working-age people are able to work,"Moffattsaid. "And it's one of the ways that the problem gets compounded."

Japan also has amandatory retirement age of61.That's the minimum age at which someone qualifies for a pension. That retirement agewill increase by four months every year until it hits age 65 in 2025. It's hoped that will encourage people to stay in the workforce longer and reduce public pension costs.

Canada has made a similar move gradually boosting the age when one can draw Old Age Security from 65 to 67 by 2029.

Two countries to watch:Sweden and Denmark

Sweden and Denmark are the "places we need to turn to," Foot said, in crafting economic and health policy to manage the shift in demographics.While the countries takedifferent approaches, they all focus on health care,offering programs akin to pharmacareor following up with seniors in their homes after a visit to the hospital.

And while Sweden's residents are not collectively older than Japan's,abouta quarter of the country's 9.5 million residents are at least 60, according to Global Age Watch.

The public purse covers mosthome-careand long-term care in both Sweden and Denmark.

Unsurprisingly, they are among the highest taxed countries in the European Union, according toEurostat.In 2013, Sweden topped the list, while in 2014 it was Denmark.

Policy-makers in Canada will have to make similar choices when it comes to taxes, Foot said, arguing moretaxrevenue will be needed, although there may be alternative ways of collecting it.

Foot said Ottawa and the provinces could look at taxing different sources,like foreign exchange or stock markettransactions.

"If the state or government doesn't step in, we'll see poverty rise amongst our senior population," he said. "We'll go back to the days when poverty rates in that population were upwards of 30 per cent."

Immigration, the fountain of youth:Germany

Germany's population remains older than Canada's, although Foot saidthat the former has followed our example and tried to stave off the aging process by accepting more immigrants.

"Immigrants tend to be in their 20s and early 30s that's when you're most mobile in your life," Foot said.

Still, Foot said accepting young immigrantswill only have a mild effect on demographics, because new immigrants made up less than one per cent of Canada's population over the last year.

Canadian employers can, however, look to Germany's skills training programs when trying to prepare younger workers,Moffattsaid. Firms there routinely have employeestransition intoretirement,working part-time in order to mentortheir successors, he said.

"I think that's going to be an important thing for any country to domaking sure thatour young workers have all the skills they need so that as the baby boomers retire, there are many people qualified to fill those jobs."