 |
||
  |
               |
|
| ||
Archived ContentInformation identified as archived on the Web is for reference, research or recordkeeping purposes. It has not been altered or updated after the date of archiving. Web pages that are archived on the Web are not subject to the Government of Canada Web Standards. As per the Communications Policy of the Government of Canada, you can request alternate formats on the "Contact Us" page. | ||
|
Total income
Overview: High-income families make gains, while incomes remain stable for restThe median income of Canadian families was essentially unchanged between 1990 and 2000 after adjusting for inflation, according to new data from the 2001 Census. The median income was $55,016 in 2000 and $54,560 in 1990. Incomes of families at the bottom half of the income distribution showed little or no improvement through the 1990s. On the other hand, the 10% of Canadian families with the highest incomes experienced substantial gains. In 2000, the combined income of the 10% of Canadian families with the highest incomes accounted for 28% of total family income, up from 26% in 1990. The 10% of families with the lowest incomes made up less than 2% of all family income, similar to what was observed in 1990. Census data also showed that in line with improved economic conditions,
the proportion of total income among working-age families that came from
government transfer payments declined from 6.4% to 5.6% between 1990
and 2000. However, the proportion has continued to increase through the
1990s for the 30% of families at the bottom end of the income distribution. Among the population of seniors who were not institutionalized, the low-income rate based on income before-tax declined from 20.4% to 16.8% between 1990 and 2000. This continued a long-term downward trend that has seen the low-income rate among seniors aged 65 and over nearly cut in half over the past two decades. As a result, in the 2001 census, unlike the 1981 and 1991 censuses, the low-income rate among seniors was lower than that among children. The census does not collect income tax information. The tax system is an important mechanism for redistributing income. When possible, comparisons were made to another source (the Survey of Labour and Income Dynamics) to verify that trends based on income after tax were similar. The important decrease in low income among seniors over the past two decades is also observed when after-tax incomes are considered. Based on income after tax, the low-income rate was 7.3% for seniors and 12.5% for children in 2000. Lone-parent families with one or more children under 18 made particularly
big gains between 1990 and 2000, the result of greater labour market
activity and increased government transfers. In 2000, the median income
of these lone-parent families was around $26,008, up 19.3% from $21,797
in 1990.
Total incomeMedian family income unchanged from 1990
Median family income unchanged from 1990The median income of Canada’s 8,371,020 families in 2000 was $55,016. Median income represents the middle point, so that one half of incomes are above this level and one half are below. Median income in 2000 was virtually the same as it was in 1990, after adjusting for inflation, although during the decade it declined somewhat and then rebounded. According to the 1996 Census, median income of families in 1995 had fallen to $51,120. Median family income was also up by 6.5%, from its value of $51,698, in 1980. A family refers to a married couple or a couple living common-law, with or without children of their own; or a lone parent of any marital status, with at least one child living in the same dwelling. Among the 4.5 million individuals living without a spouse or children of their own – people termed “non-family persons” by the census – median income reached just over $20,213. This was a 6.9% increase from $18,910 in 1990, and above the level of $17,355 in 1980.
Top tenth of families accounted for more than a quarter of all incomeFor the purposes of this analysis, families were divided into 10 groups based on their income levels, each group representing 10% of the total number of families. These “deciles” are used to describe differences between families at the high end, low end and middle of the income distribution. In 2000, the top 10% of families had incomes above $117,850. The combined income of these families accounted for 28% of the total income of all Canadian families. They accounted for 26% of the total income in 1990. At the other end of the scale, the bottom 10% of families had incomes below $18,990. The combined income of these families accounted for less than 2% of total Canadian family income, a share similar to what was observed in 1990. A relative measure of income inequality is the ratio of income of the highest income families to that of the families with the lowest income. Based on before-tax income, the 10% of families with the highest incomes in 2000 had an income of $18 for every $1 of income among the 10% of families with the lowest incomes. The census does not collect after-tax income data. However, using data from the Survey of Labour and Income Dynamics this ratio for 2000 declines by a third using income after-tax.
Families with highest incomes experienced biggest gainsThe 10% of families with the highest incomes experienced the biggest income gains between 1990 and 2000, according to the census. After adjusting for inflation, the average income of the 10% of Canadian families with the highest incomes increased 14.6%, bringing the average from $161,460 in 1990 to $185,070 in 2000. This gain contrasts sharply with families in the middle and bottom end of the income distribution where inflation-adjusted incomes have been essentially stable through the past decade. The average income of the 10% of families with the lowest incomes was $10,341 in 2000, only a slight increase from $10,260 a decade earlier. Average incomes for the 10% of families in the fifth lowest decile were $50,423, again only a slight increase from $50,256 in 1990. This mirrors 2001 Census findings on earnings which were released on March 11, 2003 in the report Earnings of Canadians. This report pointed to substantial gains in the number of people who earned $100,000 or more during the 1990s. At the same time, the number of Canadians who were making $20,000 or less in 2000 changed little during the decade.
Employment earnings account for four-fifths of all family incomeEmployment income remained by far the largest component of total family income in 2000. Earnings accounted for about 80 cents of every dollar of family income. Government transfer payments, such as old-age pensions, employment insurance benefits, child tax benefits and Goods and Services Tax credits, contributed 10 cents of every dollar of income. Investment income represented four cents of every dollar, while other income sources such as private pensions contributed six cents. These components varied widely between families at the top of the income distribution and those at the bottom. For the 10% of families with the highest incomes, earnings represented 88 cents on the dollar, and government transfer payments only one cent. For the 10% of families with the lowest incomes, earnings represented only 31 cents on the dollar, and government transfer payments 62 cents.
Government transfersShare of income from government sources declines for working-age families
Share of income from government sources declines for working-age familiesThe census also highlights changes in the proportion of income that government transfer payments represented for working-age families, those in which the spouse or parent(s) were aged between 18 and 64. These families accounted for 83% of all families. While government transfers accounted for 10 cents on every dollar of income among families of all ages in 2000, they accounted for only 5.6 cents on every dollar among the working-age families. This difference reflects the fact that working-age families are less likely to receive public pension income, such as old-age security and guaranteed income supplement benefits, as well as Canada Pension Plan benefits. The proportion of working-age family income that comes from government transfers had been growing since 1980. In 1980, transfers represented 5.3 cents on every dollar of income. They rose to 6.4 cents in 1990 and 7.9 cents in 1995. This upward trend halted during the latter half of the 1990s, when the share fell to its current level of 5.6 cents.
Lower income families more reliant on government transfersThe proportion of income from government sources did not decline for all working-age families between 1990 and 2000. The 30% of working-age families with the lowest incomes experienced an increasing share between 1990 and 2000, while the remaining 70% of families saw declining proportions. The lowest 10% of working-age families rely most heavily on transfer payments. Between 1990 and 2000, the proportion of their income that came from government transfers increased from 58.4% to 62.2%. Over the same period, the government transfer share for the 10% with the second lowest incomes increased from 26.7% to 30.4% and for the 10% with the third lowest incomes from 15.1% to 16.7%. The lowest 10% of working-age families received an average of $5,776 in government
transfers payments in 2000, up from $5,552 in 1990 and $4,953 in 1980. Among
the 10% with the highest incomes, average government transfers increased from
approximately $2,210 in 1980 to $2,260 in 1990, but then decreased to $1,410
in 2000. Child benefits redistributed during the past two decadesAn important part of redistribution of government transfers to families with lower incomes has been the transition from the “universal” family allowance to the current income-tested Canada Child Tax Benefit. According to the 1981 Census, the 10% of families with the lowest incomes received $1,276 on average in child benefits in 1980, while the 10% with the highest incomes received $1,283. In sharp contrast, the 10% of families with the lowest incomes received $2,378 on average in child benefits in 2000. The 10% of families in with the highest incomes received only $26.
Low incomeLow-income rate among families unchanged during 1990s
Low-income rate among families unchanged during 1990sMedian income of Canadian families was essentially unchanged during the 1990s, and so was the incidence of low income. In total, approximately 1,050,000 families were below Statistics Canada’s 2000 low-income cutoffs based on before-tax income, up from just over 935,000 a decade earlier. While the number of all families increased 13.8% during the 1990s, the number of low-income families rose at a slightly lower rate, 11.6%. In 2000, the low-income rate of families based on before-tax income was at 12.6%.
Proportion of seniors in low income now below the proportion of childrenThe proportion of all children living in low-income based on income before-tax was virtually unchanged between 1990 and 2000, around 18%. In contrast, the proportion of all seniors aged 65 and over in low income declined from 20% to 17% over the past decade. In total, nearly 1,245,700 children were living in low income in 2000, a 3.5% increase from a decade earlier. However, their numbers were below the total of approximately 1.3 million in 1980. More than 600,000 seniors were living in low income in 2000, a 2.9% increase from 1990 but a 5.4% decrease from 1980. Between 1980 and 2000 the population aged 65 and over increased by 68 percent. The decline in the low-income rate for seniors would have been even more important if income after-tax had been measured. According to data from the Survey of Labour and Income Dynamics, 12.5% of children under 18 were living in low-income in 2000, based on after-tax income. This proportion has been virtually stable over the past two decades. In contrast, the percentage of seniors aged 65 and over in low-income, based on after-tax income, decreased from 21% in 1980 to 10% in 1990 and 7% in 2000. It should be noted that in addition to those living in Canada’s three territories and on Indian reserves, low-income statistics exclude people living in institutions. The latter restriction is particularly relevant for the population aged 65 and over. This is because 4.4% of men and 8.4% of women in this age group were living in institutions in 2001, according to the census. Low-income rates among individuals in the working-age population also remained
stable during the past two decades.
Half of children in low income lived in two-parent nuclear familiesOne-half of the 1,245,700 children under 18 living in low income in 2000 were living in nuclear families with two parents. About 21% lived in two-parent families in which only one parent had employment earnings; about 17% in families in which both parents had earnings; and another 12% in families in which neither parent reported earnings. Low income among children was disproportionately concentrated in lone-parent families, and in particular, in lone-parent families in which the single parent had no employment earnings. According to the census, 14% of all children lived in lone-parent families in 2000. However, these families accounted for 39% of all children in low income. In addition, 4% of all children lived in lone-parent families in 2000 where the single parent had no earnings. But these families accounted for 20% of all children in low income.
One-third of children with recent immigrant parents in low-incomeWhile low income among young children with Canadian-born parents has declined during each of the past two decades, the low-income rate among children with immigrant parents has increased. In 2000, almost 231,000 children with at least one immigrant parent who arrived in Canada during the 1990s were living in low income. The low-income rate among children where at least one parent immigrated in the previous decade was at 33% in 2000, up from 27% in 1990, and 20% in 1980. When both parents had immigrated in the last decade, the low income rates were even higher (39% in 2000, 33% in 1990 and 22% in 1980). In contrast, among children with Canadian-born parents, 16% were in low income in 2000, compared with 17% in 1990, and 19% in 1980. An additional 162,000 children with immigrant parents that arrived in Canada before 1990 were living in low-income in 2000. Census earnings data reveal that despite the fact that immigrants of the 1990s were more educated, they have had more difficulty matching the earnings of their Canadian-born counterparts than did immigrants of the 1970s and 1980s.
Low income rate among Canadians aged 65 and over fell by nearly half over past 20 yearsSeniors aged 65 and over experienced substantial declines in their low-income rates over the past two decades. In 2000, 17% of seniors were living in low income, down from 20% a decade earlier and 30% in 1980. Of the seniors living in low income in 2000, the vast majority, 71%, or almost 428,300, were women, and 29%, or just over 173,000, were men. Put another way, 21% of senior women were living in low income in 2000, almost double the proportion of 11% among senior men. This gap is due to a number of factors, but leading the list is the higher incidence of living alone among senior women, which in turn reflects their higher life expectancy compared to males. It also underlines the fact that senior women are less likely to be receiving private pension income than their male counterparts.
Seniors living alone particularly likely to be in low incomeSeniors who lived alone, especially women, were far more likely to be in low income than others, according to the census. About 413,200 seniors who were living alone were in low income in 2000. They represented more than two-thirds of the non-institutional senior population in low income. The rate was higher among senior women living alone (43%), compared with a rate of 31% for their male counterparts. In contrast, only 11% of senior women and 8% of senior men who lived with relatives were in low income. The proportions were even lower among those living with a spouse. Despite the higher incidence of low-income among the senior population living alone, these rates were down substantially from two decades ago. In 1980, 65% of the population aged 65 and over who lived alone were in low income, compared with 40% in 2000. The low-income rate was also down for seniors who live with a spouse. In 2000, their low-income rate was 6%, well below the rate of 15% in 1980. Senior women with lowest incomes had biggest income gainsAlthough their low-income rate remained high in 2000, women aged 65 and over who live alone experienced significant gains in income during the past 20 years. The biggest increases between 1990 and 2000 were among those at the low end of the income distribution. After adjusting for inflation, the average income of the bottom 10% of senior women living alone was $11,150 in 2000, a 40% increase from $8,000 in 1980. The 10% of these women with the highest incomes had an average income of $63,000, up 13% from 1980. Except for the women with the highest incomes, gains in average incomes during the past two decades for senior women living alone have increased by at least 20% across the entire income distribution. This increase was three times the gain of 6% observed among all Canadian families.
Decline in low income among senior women due to higher government transfersDuring the past 20 years, 99% of the income gain of the 10% of elderly women living alone with the lowest incomes was from higher government transfer payments. In contrast, among the 10% of these women with the highest incomes government transfers accounted for only one-quarter of the gain in income. Instead, private pensions and investment income accounted for 63% of their increase in income. Among the 20% of women in the middle of the income distribution, government transfers accounted for more than 80% of their gain. This dovetails with the findings of previous Statistics Canada research studies that showed that the impressive income gains among low-income seniors during the 1980s and early half of the 1990s were driven by a combination of two factors: rising benefits from old-age security and guaranteed income supplements, and the maturity of the CPP/QPP program since 1976, when the first group to receive full benefits turned 65. Together, these programs have produced substantial gains in incomes for seniors, after adjusting for inflation, and substantially reduced income inequality within this age group.
Old-age security makes up two-thirds of income of low-income seniorsIn 2000, two-thirds of the income of Canada’s low-income seniors came from old-age security benefits and guaranteed income supplement benefits. An additional 20% of the income of these seniors came from Canada Pension Plan and Quebec Pension Plan benefits. Together, public pensions accounted for approximately 85 cents out of every dollar of income for the estimated 601,300 seniors living in low income in 2000. In comparison, public pensions accounted for 39 cents out of every dollar of income for seniors who were not living in low income. Instead, the majority of the income for seniors not in low income came from market sources. About 28% came from private pensions, such as pensions from a former employer, as well as registered retirement savings plans. An additional 15% came from investment income, and 13% came from employment income.
Couple and lone-parent familiesSignificant gains for nuclear families with young children Significant gains for nuclear families with young childrenAlthough the median income of all Canadian families was stable through the 1990s, nuclear families with young children experienced significant gains in inflation-adjusted incomes. The median income of couples with children under 18 increased 5.9% to nearly $66,000. Couples with children who were aged 18 and over had a median income of just over $80,500, up 3.7% from 1990. However, lone parents with children under 18 experienced the largest increase (19.4%). Between 1990 and 2000, their median income rose from $21,800 to $26,000. Although the median income of these nuclear families increased, the median among all families was stable because the population and families have been aging. Older families tend to have lower incomes since they are less likely to have employment earnings. In addition, there were proportionally more lone-parent families in 2000 than in 1990, and lone-parent families tend also to have lower incomes. Lone-parent families with children under 18 experienced strong gains in income during the 1990s. Even so, their before-tax median income in 2000 was still only 40% the median before-tax income of couples with children under 18. This income gap in part reflects the fact that in 2001, more than 75% of those couples had dual-earners.
Percentage of lone-parent families in low-income declinesFor the first time in two decades, the proportion of lone-parent families with children under 18 living in low income fell below the half-way mark. Based on their before-tax income, 46% of lone-parent families with children were in low income in 2000, compared with 54% a decade earlier and 55% in 1980. While the number of lone-parent families with children under 18 increased 70% between 1980 and 2000, the number of these families in low income rose only 40%. Between 1990 and 2000 the low-income rate of couple families with young children edged up slightly from 10.5% to 11.2%. The low-income rates of families with older children, and couples without children, were essentially unchanged over the past decade. At 46%, the low-income rate in 2000 among lone-parent families with young children was still four times higher than the rate of 11% observed among two-parent families with children.
Half the decline in low-income rate among lone-parents due to rising market incomeJust over one-half the decline in the low-income rate among lone parents with children under 18 was due to rising market incomes, as opposed to increased support from government transfer payments. Based on their before-tax income from all sources, the proportion of lone-parent families with children in low income declined 7.6 percentage points between 1990 and 2000. Gains in market income of these lone-parent families accounted for 4.2 percentage points of this 7.6-percentage-point drop. The remaining 3.4 percentage points were attributable to rising income from government transfers. If these lone-parent families had received no government transfer payments, the low-income rate of lone-parent families in 2000 would have been 57% instead of 46%, a difference of 11 percentage points. The impact of government transfers in reducing low-income rates has been increasing. In 1980, the proportion of these families in low income would have been six percentage points higher without transfers. In 1990, it would have been seven percentage points higher.
Proportion of lone parents with employment income on riseLone-parent families with young children were more likely to have labour market earnings in 2000 than they were a decade earlier. In 2000, 74% of lone parents with children under 18 reported employment earnings, compared with 68% in 1990. The proportion was at 65% in 1980. In 2000, 76% of families with children under 18 consisted of dual earners, up only slightly from 73% in 1990. This was a relatively small gain compared to what was observed in 1980 when the proportion was only 57%. The share of lone parents with children under 18 who reported employment earnings increased in every province between 1990 and 2000, except for Newfoundland and Labrador and British Columbia. The highest proportion was in the Yukon, where 90% of lone parents with young children reported having employment earnings. Among the provinces, the highest proportion was in Prince Edward Island, where the proportion with earnings was 87% in 2000, up from 74% in 1990. Alberta followed with 83%, up from 76% in 1990. The lowest proportion was in Newfoundland and Labrador (53%).
|
 |
 |
|
|
||
| [Home | Search | Contact Us | Français] | ||
| Date modified: | Important Notices | |
