Canadian incomes jump but Ontario residents hit by manufacturing downturn: Statistics Canada

Canadian incomes jump but Ontario residents hit by manufacturing downturn: Statistics Canada
In Ontario, the downturn in the manufacturing sector slowed income growth and the proportion of low-income residents has been on the rise.   (Peter Lee / Record staff)  

Ottawa Bureau

Wed., Sept. 13, 2017

Canadian incomes have risen by more than 10 per cent over the last decade, fuelled by a booming resource sector, but the number of low-income persons is rising in Ontario where growth has been sluggish, Statistics Canada says.

New data from the 2016 census reveals that the median income of Canadian households rose to $70,336 in 2015, up 10.8 per cent from $63,457 in 2005.

The jump is attributed to high resource prices that attracted investment and workers to Alberta, Saskatchewan and Newfoundland, pumped up the construction sector and saw wealth filter through the economy, Statistics Canada said Wednesday.

Census 2016: Canada’s population gains and losses

“The story of the last 10 years is really about the resource rich areas. They’ve drawn investment, they’ve drawn population and median incomes have risen faster there than for other areas,” Andrew Heisz, assistant director of income statistics division at Statistics Canada, said in an interview.

But the story is not so rosy in Ontario, where the downturn in the manufacturing sector slowed income growth and the proportion of low-income residents has been on the rise.

The median income in Ontario was $74,287 in 2015, up just 3.8 per cent over the last decade, the slowest growth of any province or territory over the last decade.

That’s attributed to the gutting of the manufacturing sector and the loss of 318,000 jobs, down 30 per cent over the last decade,

Almost every metropolitan centre in Ontario saw below average income growth, compared to the booming Prairies, where incomes rose above average. The Greater Toronto Area had a median income of $78,373 in 2015, up 3.3 per cent. In the GTA, Oakville had the highest median income at $113,666. The City of Toronto had the lowest at $65,829.

The last decade has also seen a rise in low-income rates in Ontario’s urban centres, led by London (17 per cent, up from 13 per cent) and Windsor (17.5 per cent, from 14 per cent).

In 2015, 14.4 per cent of Ontario residents — some 1.9 million people — were low income, up from 12.9 per cent in 2005.

Nationwide, the low-income rate edged up slightly over the decade to 14.2 per cent in 2015, from 14 per cent a decade earlier.

“We see a relative stability in low income. That means in this period of growth, people aren’t falling further behind. But they aren’t necessarily catching up either,” Heisz said.

“A decline in the low income rate is possible if incomes of lower income persons are rising faster than the median. But that hasn’t been the case here,” he said.

(Statistics Canada defines a low-income household as one having less than half of the median income of all households.)

That means 4.8 million Canadians were living in a low-income household in 2015, some 1.2 million of them children.

Lone-parent families and those with more than one children are more likely to be low-income, Statistics Canada.

In seven of the country’s largest 35 urban centres, at least one in five children was living in a low-income household. And among those cities, Windsor had the highest rate of children (24 per cent) living in low-income households. That’s partly because the southern Ontario city saw a 6.4 per cent drop in household income, the largest decline of any large city. London, St. Catharines-Niagara and Belleville also had more than 20 per cent of children living in low-income conditions.

However, Statistics Canada says that the proportion of low-income children has been dropping since the mid-1990s, thanks in part to government programs. The average child benefit received by families has nearly doubled since the mid-1990s, the agency says.

“We know from other research that government transfers are important for reducing people in low income. More progressive transfers, such as child benefits, play an important role in reducing the low income rate among families with children,” Heisz said.

The 10.8 per cent rise in income over the most recent decade compared with 9.2 per cent growth in the previous decade and a decline of 1.8 per cent in the decade before that.

Tapping natural riches have fattened the wallets of Canadians living in resource-rich provinces and territories, led by Nunavut (36.7 per cent) and Saskatchewan (36.5 per cent).

However, Statistics Canada cautions that census results do not account for the sharp drop-off in oil prices that hit the economy and stalled the resource sector in 2015 and 2016.
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