It's difficult to say about him jolting up out of his sleep. It could be that he heard something, it could be that he's starting to have some bad dreams.
Senility often is more apparent in aging cats than dogs, but sometimes they will "get lost" in different rooms of the house. They can go into a room and suddenly realize that they are alone in there and start to vocalize, knowing that it will draw the attention of someone. When you go "save" them, they return to their normal selves. If it's a case of their senses dulling with age, that could carry over into their sleep and bad dreams could result. That might be what is responsible for him jolting awake from a sound sleep.
One thing that I do need to advise you about is that no matter how well they know us or how gentle or friendly they are, if they are experiencing sensory deficits and you wake them from a sleep, if they can't adequately visualize you or hear you and you surprise them, ANY dog can snap at you because of the surprise factor. This doesn't mean they are getting nasty in their old age it just means that they are reacting to something that they were not expecting. It's always a good idea to try to wake them before touching them, or if you do touch them to wake them, touch their hindquarters and don't lower your face to them until they are awake and know that it's you. Eventually it will become second nature to you to wake him this way if he doesn't react to you calling him. It's all a matter of what you get used to.
Ghilly
Thanks for your help! I think if I can do a bit of re-training with him I might be able to get him to be a bit more obedient. I tried using some treats today on our walk and he was more attentive to me, he is extremely food oriented which works good in this case. I have never used the whistle that dogs supposedly can hear but we cant but maybe I should give it a try. I also don't see that there is much ear wax but I will say that when I rub his ears he groans quite loudly as if its either such a fantastic feeling or bothering him a lot! I took him to the vet about a month ago and they did not mention any ear issues. I hate going to my vet because they charge me about 60$ just to walk in. So ridiculous for it to cost so much. It doesn't help me be proactive about his care. He does have long ears but has never had an ear infection. He is a setter mix. What do you think about the way he jolts up out of a sleep/rest as if he heard something? Is that "normal"?
He's at the right age to start to lose his hearing, but dogs his age also sometimes have mild senility that causes them to act out of character.
When they do start to lose their hearing, it's often not an across-the-board thing. Like you said, he can hear food dropping into his bowl but when you come home from work and he's sleeping you end up surprising him. Different sounds and different frequencies can be easier or more difficult for him to hear. What might, to us, seem like something that would be very easy for him to hear is, because of the frequency, totally lost to him.
What about a dog whistle? The ones that we can't hear but they can? Maybe get one of those and see if he reacts when you use it. If he does, then you can try using that when you are on your hikes. You need to figure something out, otherwise the only safe thing to do is going to be to keep him on a lead when you're walking. It's unsafe for a hearing impaired dog to be off-lead anywhere but in his own home. Street traffic posts an obvious threat in the city and suburbs (and even on country roads) and when you're hiking in the woods, depending on where you live, there are dangers there that he could run into if he can't hear them, not the worst of which is straying away from you and not being able to hear you calling him back to you and ending up lost. A clicker is another thing you could try. The sharp sound of the clicker might be something that he can hear, if not the dog whistle. It's going to be a case of trial and error. Use your imagination. Just because it's not a "normal" device used to get someone's attention doesn't mean it can't be used for your dog. As long as he responds to it, use it. I would also take him to the vet to be evaluated. He could have an ear infection or something in his ears that is making it difficult for him to hear. You don't say what breed he is, but dogs with long, pendulous ear pinnae often have a buildup of waxy cerumen in their ears and if enough of that gets in there, it can impede their hearing. An examination and maybe a good cleaning by the vet may help, even if only a bit.
Ghilly