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The richest 10 per cent of families earn 190 per cent of the average of Ontario families’ earnings. — CCPA report
Toronto (16 Aug. 2017) — Ontario is becoming more polarized as the bottom half of Ontario families see their share of the income pie shrinking while the top half takes home even more, says a new report by the Canadian Centre for Policy Alternatives (CCPA).
The report, Losing Ground: Income Inequality in Ontario, 2000-2015, shows that the bottom half of families raising children in Ontario saw its share of earnings fall to 19 per cent of total labour market income between 2000 and 2015 — down 3 percentage points — while the top half of families increased its share of the income pie by 3 percentage points, earning 81 per cent of the total income pie.
Stagnant wages, low wage work allow lower-middle class and working poor to fall further behind
“There is a lot of talk about helping out the middle class, but the reality is that it’s lower-middle class and working poor families who are falling behind due to declining labour market earnings,” says Shiela Block, CCPA Senior Economist. “It’s a reflection of an increase in precarious, low-waged work in Ontario since the early-2000s and that’s a challenge for provincial policy makers."
“Supports through the tax and transfer system, particularly through the province’s poverty reduction strategy, acted as a crucial backstop for families. But Ontario will need to get more aggressive if it’s going to turn the corner on this issue. It starts with raising the minimum wage to $15, but better labour laws and income security programs that help the bottom half of families are also urgently needed," says Block.
Top half of Ontario families experience growth in earnings
Between 2000 and 2015, the poorest 10 per cent of families saw their average real work income drop by $1,536 (they rely mostly on government transfers) — down by 42 per cent. Families in the second poorest decile saw their average real earnings drop by 24 per cent. Those in the third decile had their average real earnings drop by 13 per cent, those in the fourth decile had a 6 per cent drop in average real earnings, and families in the middle decile saw their average real earnings drop by 1 per cent.
The top half of Ontario families fared better: families in the next 4 deciles experienced average real earnings growth while average real earnings for the richest 10 per cent of families held steady. The richest 10 per cent of families earn 190 per cent of the average of Ontario families’ earnings.
The Ontario story stands in contrast to the national story, where the natural resource boom and economic growth in other provinces translated into real average income gains for practically all Canadian families.