Older Canadians are powering the 'gray-shaped economy' — how to take advantage of this shift (and what to watch out for)

Mark Zandi, chief economist at Moody’s Analytics, says that older Americans are “driving the train,” thanks to “higher home prices and, more recently, surging stock prices.”

While the Axios analysis refers to the U.S., Canada has a similar economy. As noted by the Fraser Institute’s 2025 Wealth Inequality Revisited report, 77.3% of households in the top 20% of wealth were aged 50 and older, with net worth peaking at C$1.17 million for those aged 60 to 64 according to Statistics Canada data (2).

The gray-shaped economy is reshaping entire industries, from financial services to travel to healthcare. While this is creating new opportunities — for those who can capitalize on it — it also creates new challenges.

Benefits of a ‘gray economy’

Canada’s population is greying — almost one-fifth (18.9%) of the total population is aged 65 and older (as of July 1, 2023). By 2030, seniors could represent 21.4% to 23.4% of the total population, according to StatCan (3).

But today’s baby boomers are in a unique position.

“The elderly are mostly out of the job market and thus need not worry about being replaced by artificial intelligence. The majority own their homes, often debt-free,” writes Greg Ip, chief economics commentator of The Wall Street Journal (4).

In fact, wealth for the average Canadian boomer household rose to C$1,458,282 in Q2 2025, according to StatsCan. (5)

That means older Canadians also have an outsized influence on the economy. For example, job growth in Canada is largely concentrated in health care and social assistance (6).

This creates opportunities for older Canadians, such as investing in aging-focused businesses or spending their money in sectors that cater to their needs. “The changing demographics help explain all kinds of new businesses and marketing trends: longevity startups, the boom in menopause companies, among them,” according to Axios (1).

Risks of this economic reality

Along with new opportunities come new risks. In an aging society with a declining birth rate, there will be fewer young people to support social safety nets. Old Age Security (OAS) and the Guaranteed Income Supplement (GIS) still leave low-income seniors thousands of dollars below the poverty line in high-cost cities such as Toronto and Vancouver.

This can lead to other economic headaches, such as labour shortages.

In Japan, for example, a rapidly aging population and declining birth rate has created a shortage of successors for small and mid-sized businesses (SMBs), which could result in the loss of 6.5 million jobs. About half of small business owners over age 70 were expected to find themselves without a successor in 2025 (7).

There’s also a surplus of abandoned homes, known as ‘akiya.’ About nine million houses — equivalent to 14% of all houses in Japan — have been abandoned, in large part due to urban migration.

Similarly, nearly two-thirds of Canadian business owners haven’t formalized a succession plan, according to MNP’s Succession Readiness Report, which threatens business continuity and economic stability (8).