Until recently, demographers, policy analysts and marketing managers have been fixated on the Baby Boom generation since it has had such a profound impact on so many aspects of life in North America and in Canada in particular since it started in 1945. Over the past few years, this attention has shifted to the children of baby boomers (born between 1981 and 1996).
This group, also referred to as “the echo boom”, generation “Y” or, more frequently, the millennial generation, makes up 22% of Canada’s population which is estimated to be 37.1 million as of July 1, 2018.
This focus on millennials, aged 23 to 38, has become more intense despite the fact this age cohort’s growth, over the past five years (7.2%), has been significantly slower than that of the 16.2% increase in their baby boom parents’ cohort, aged 55 to 74.
While the Baby Boom generation’s cohort is larger and has grown faster than has the millennial generation’s cohort, the impact of this younger demographic group is more significant in the short term.
For example, according to CMHC’s 2018 Mortgage Consumer Survey, 49% of first-time home buyers are millennials. According to Environics Analytics, millennial households account for 19% of all households, approximately half the number of households headed by baby boomers.
However, over the next 10 years, as mortality shrinks the baby boom generation, the number of households headed by millennials will start to exceed those headed by baby boomers. Clearly, millennials will have a more significant impact on both the type of housing built as well as its location.
As noted by several commentators, including Pierre Cleroux, Chief Economist at the Business Development Bank, millennials will have a profound impact on consumer spending patterns over the medium term.
Establishing a new household and starting a family will cause spending by millennials to be significantly higher than other population cohorts. It is also worth noting that millennials are considered to be major participants in the “Gig” economy. However, as noted in Snapshot #5 titled “Real” Job Growth appears to have sidelined the Gig Economy, based on the fact that the percentage of workers in temporary jobs has remained essentially unchanged since 2010 and the period of time that employees remain in the same job has steadily risen over the past 30 years, there is little evidence to suggest that millennials are less fully employed than other demographic groups.
Two questions come to the fore regarding millennials in 2018. The first is which census metropolitan areas have the highest concentration of millennials? The second question is where are millennials moving, i.e., which CMAs have seen the fastest growth of their 23-to-38 year-old age group over the past five years? However, the answer to this question has a major caveat. According to the 2016 census, almost 70% of millennials moved in the five years prior to the 2016 census, more than twice the percentage of non-millennials. This higher propensity to move by millennials is completely consistent with the fact that a majority are not tethered to a particular location by home ownership, family responsibility or an extended employment history.
So where are millennials living? Not surprisingly, a million and a half (19%) of Canada’s 8,150,000 millennials reside in Toronto. Montreal is home to just under a million (965,000) and 650,000 call Vancouver home. On average, millennials account for approximately one fifth of the population of Canada’s 34 census metro areas (which have populations above 100,000). However, above average concentrations are present in the West — specifically Regina (25.2%), Edmonton (25.0%), Calgary (24.8%) and Winnipeg (24.7%) — while millennials are under-represented in St. Catharines-Niagara (17.3%), Saint John NB (17.6%), Belleville (18.1%), Trois Rivieres (18.3%) and Saguenay (also 18.3%).
But where are millennials moving to? Well, over the past five years, the millennial population of Kelowna, British Columbia has increased by 19%, more than three times the national average. Peterborough, Ontario’s millennial population has increased by 14.6%, followed by increases of 14.3% in Winnipeg, and 13.7% in Saskatoon.
Finally, it is worth noting that according to Stats Canada, “permanent and temporary immigration is the key driver of population growth in urban Canada”. The chart illustrates the 15 census metro areas with the highest concentration of millennials and the extent to which net immigration of international, interprovincial, intraprovincial and temporary millennial migrants contributed to this concentration over the past five years.
John Clinkard has over 35 years’ experience as an economist in international, national and regional research and analysis with leading financial institutions and media outlets in Canada.
Census Metro Areas with the largest
milllennial populations and net gain due to
in-migration over past 5 years
Chart: ConstructConnect — CanaData.