According to Statistics Canada, income inequality in Canada is at an all-time high as wealth becomes increasingly concentrated in fewer hands.
Statistics Canada reported Thursday that the gap in the proportion of disposable income between the richest and bottom two-fifths of Canadians widened to 47 percentage points in the second quarter of 2024. .
This is the largest gap recorded since 1999, when Statistics Canada first began collecting such data.
The difference was driven by the top 20% of earners, whose share of disposable income increased the most, the report said. This increase was mainly due to investment gains, which the tax authorities attributed to higher interest rates.
“Rising interest rates may lead to higher borrowing costs for households, but they may also lead to higher yields on savings and investment accounts,” the report said.
“Low-income households, on average, have fewer resources available for savings and investment, so they are more likely to have limited ability to take advantage of these higher returns.”
While the bottom 20% of Canadians saw a small increase in their share of disposable income due to wage increases, the middle 60% of Canadians saw their share decrease.
The top 20 per cent of Canadians held more than two-thirds of the country’s wealth in the second quarter, averaging $3.4 million per household, according to a Statistics Canada report. By comparison, the bottom 40 per cent of Canadians accounted for just 2.8 per cent of Canada’s wealth.
Asked about Canada’s growing income inequality, Finance Minister Chrystia Freeland said the Liberal government will focus on promoting policies such as child care and dental care programs to support middle-class and low-income Canadians. He said that he has put
“We are working very hard to counter the trend of rising inequality in the global economy,” he told reporters at a press conference on Thursday.
“We’re leaning into that with very specific policies designed to support middle-class Canadians and people who work hard to join the middle class.”
But Conservative Party leader Pierre Poièvre blamed Liberal policies for widening wealth and income inequality.
“Today, Statistics Canada says that NDP and Liberal money printing has inflated the wealth of the ultra-rich and inflated the cost of living for everyone else, resulting in the widest gap between rich and poor than in recorded history,” he told reporters. “It has reached the highest level,” he said. Press conference.
