A new Deloitte Canada report finds health-related barriers to workforce participation cost the country more than $100 billion in economic output in 2025
Poor health is costing Canada more than most Canadians realise and for financial advisors, the numbers carry a direct message about the clients they serve.
A report published September 22, 2026, by Deloitte Canada reveals that health-related barriers to labour force participation drained more than $100 billion in economic output from the Canadian economy in 2025. The analysis introduces what Deloitte calls a Health Productivity Gap (HPG) framework; a first-of-its-kind tool designed to quantify the combined economic cost of illness, mental health challenges, and unpaid caregiving responsibilities.
Clients who are sidelined by chronic disease, burnout, or caregiving obligations are not just dealing with personal hardship - they are accumulating less, contributing less to retirement accounts, and in some cases withdrawing from the workforce earlier than planned. That has direct implications for portfolio growth, withdrawal timing, and the financial plans advisors build alongside them.
What the numbers say
Deloitte's HPG framework breaks the economic loss into two distinct problems. The first is a prevention gap - capacity lost to illnesses that could have been avoided or better managed with earlier intervention. The second is a participation gap - workforce capacity constrained by chronic disease, mental health conditions, and the demands of caregiving, largely for aging family members.
The dollar figures behind each gap are striking. According to the September 2026 Deloitte Canada report, $55.1 billion in lost economic value was linked to morbidity - time away from work due to illness. An additional $48.5 billion in lost labour income was tied to unpaid caregiving responsibilities, a burden that falls disproportionately on women and those in middle age. A further $1.1 billion in lost output was attributed to premature mortality, specifically the time and cost required to replace and retrain workers.
Deloitte also modelled what a partial solution would look like. Reducing caregiving burdens by 25 per cent, the report found, could generate more than $12 billion in economic gains annually. A 25 per cent reduction in morbidity-related impacts could add more than $13 billion in GDP. In total, the firm estimates that closing a quarter of the Health Productivity Gap could recover more than $25 billion in annual economic output for Canada.
"Productivity is one of Canada's most pressing challenges, yet health is rarely considered part of the productivity agenda," said Michelle Theroux, National Health Leader at Deloitte Canada. "We cannot expect technology, AI, or workforce upskilling to solve Canada's productivity challenge if people are increasingly sidelined by illness, poor mental health, or caregiving responsibilities. Better health is not just an outcome of a strong economy. It is a prerequisite for one."
The retirement connection
For financial advisors, the health-productivity link is not new - but its scale, now quantified in this Deloitte framework, adds weight to conversations that many in the industry have been having with clients for years.
Retirement plans are built on assumptions: contribution timelines, income projections, and targeted drawdown dates. When a client leaves the workforce early due to illness, or reduces their hours to care for an aging parent, those assumptions shift. The window for compound growth narrows, and the financial cushion required at retirement grows. As Wealth Professional has reported, advisors are increasingly being asked to navigate the intersection of client health and financial planning, with some going so far as to incorporate wellness programming into their client engagement model.
That intersection is about to widen. Canada's aging population means that caregiving responsibilities will intensify across the advisory client base in the coming decade. Clients caring for parents while still in the workforce - sometimes described as the "sandwich generation" - face compounded financial risk that sits squarely in an advisor's purview.
The Deloitte report outlines seven integrated actions it believes governments, employers, health care organisations, and other stakeholders should pursue. These include enrolling every Canadian in a primary care model focused on prevention, removing structural barriers to accessing health care, giving individuals financial tools to invest in their own health, and meaningfully modernising digital health infrastructure.
As Wealth Professional has explored, advisors who work closely with clients across life stages are often the first to notice signs of diminished capacity or mounting caregiver stress. That proximity gives them an opportunity: to flag health-related risks to retirement readiness before they become crises, and to help clients understand why robust financial planning and proactive health decisions are, ultimately, the same conversation.
"There is no single solution to Canada's health-productivity gap, but there are practical steps we can take now that will pay dividends in both the near and long term," said Matthew Stewart, Partner, Economic Advisory at Deloitte Canada. "Better prevention, improving workforce participation and smarter use of existing capacity and technology could unlock billions in economic value and strengthen Canada's long-term growth."
