Canadians Getting Richer at a Rapid Rate

Canada’s middle class is shrinking, but don’t be alarmed. There are less middle class Canadians because more people who live in Canada are joining the wealthy class! The respected Pew Research Center recently examined 111 countries around the globe and reported (July 2015) that Canadians are getting richer at a rapid rate as incomes soar across Canada. During the 10-year period between 2001 and 2011, the wealth of people who live in Canada increased at the seventh highest rate of any of the 111 countries studied. Only residents of #1 Norway, #2 Denmark, #3 Luxembourg, #4 The Netherlands, #5 Iceland and #6 Finland saw their wealth grow at a faster pace than people who live in Canada.

The Pew Research Center further reported (July 2015) that 56% of four-member households in Canada were in the high-income bracket in 2011, which was the same percentage as in the United States that same year and much higher than the 44% in Western Europe and 5% in Eastern Europe. In 2011, 36% of four-member Canadian households were in the upper-middle class category, compared to 32% in the USA, 43% in Western Europe and 27% in Eastern Europe. Only 6% of Canada’s four-member families were in the middle class in 2011, compared to 7% in the United States, 10% in Western Europe and 40% in Eastern Europe that year. At the other end of the economic spectrum, just 1% of Canadian four-member households were categorized as low income in 2011, which was lower than the 3% in the USA, 2% in Western Europe and 28% in Eastern Europe. Considering the differences of income levels in these four geographic regions, it is interesting that less than half-a-percent of four-member households in Canada and Eastern Europe were poor, compared to 1% in Western Europe and 2% in the United States, according to the study.

In terms of the pace at which people who live in Canada became wealthier, Pew researchers reported that the percentage of high-income four-member families in Canada increased from 49% in 2001 to 56% in 2011, while the percentage of four-member Canadian families in the middle income bracket dropped from 9% in 2001 to just 6% in 2011. This drop in the percentage of middle-income Canadians was a result of more people who live in Canada moving higher up on the "income ladder" between 2001 and 2011. By comparison, four-person families in the high income bracket dropped in the United States from 58% in 2001 to 56% in 2011, plus the percentage of four-member American families in the middle income bracket also fell from 8% in 2001 to 7% in 2011. According to the data analyzed by the Pew Research Center, “Not only is income inequality lower in Canada in comparison with the US, but, unlike in the US, there was no increase in inequality in Canada from 2001 to 2011.”

This 2015 Pew Research Center report is supported by the 2014 Prosperity Index published by the Legatum Institute in London, which ranked Canada as the 5th most prosperous country in the world out of the 142 countries examined (only residents of #1 Norway, #2 Switzerland, #3 New Zealand and #4 Denmark were assessed to be more prosperous than people who live in Canada). For example, the Legatum Institute reported in its 2014 Prosperity Index that the average net worth of Canadians was $442,130 in 2014, which was among the highest found anywhere around the globe. In sum, these studies and other research confirm that Canadian residents are among the wealthiest people on Earth. Jobs in Canada, particularly in certain high-demand occupations, tend to pay very well, and this helps Canadian residents to increase their wealth and enjoy one of the best standards of living on the planet. The abundance of Canadian jobs and other factors also make it possible for there to be less inequality in Canada than exists in the neighboring United States and other countries. There is a famous saying that “the rich get richer, and the poor get poorer,” but in Canada, as this research suggests, “the rich get richer and the middle class get richer, too!”