(Photo: James MacDonald, Bloomberg)
Since 1997, the gap between the richest and poorest in Canada has widened, a reality underscored by the troubling findings in the United Way’s latest report The Opportunity Equation.
The research reveals that Toronto is where income inequality is most pronounced: it grew at double the national rate of 14 per cent between 1980 and 2005. The city’s income inequality jumped by 31 per cent, ahead of Calgary, 28 per cent; Vancouver, 17 per cent; and Montreal, 15 per cent.
“Because of the concentration of poverty, declining job quality and rising income inequality, we are seeing that Toronto can be a city of opportunity, but only for some. This is cause for concern,” said Susan McIsaac, president and CEO of United Way Toronto.
“Fairness is being undermined in our city—growing income inequality is creating an uneven playing field for opportunity. Hard work and determination are not a guarantee for success—a person’s background and circumstances have a far greater influence on their future.
It is a troubling finding that affects every level of society, even the rich who may feel sheltered from the issue.
Violent crime, for example, has not only been positively correlated with income inequality, but also causally linked. This is an important distinction that means the more inequality endemic to a region, the more violent crime will exist alongside it.
In 1976, the top 20 per cent of income earners took home (after tax) $109,700 a year on average according to Stats Canada. In 2011, that figure grew to $139,400—a jump of $29,700. In contrast, the bottom 20 per cent of income earners took home only $13,000 a year on average in 1976 and $15,100 in 2011—a difference of only $2,100.
The economic gap between these two groups in 1976 and 2011 was $96,700 and $124,300 respectively; meanwhile, the cost of living has risen steadily from 31.1 to 119.9 (CPI), an increase more easily absorbed by the rich than the poor.
The Opportunity Equation sketches a roadmap to address this disparity and, consequently, the societal harms engendered by it. Among the recommendations: making housing affordable, building an effective Labour Market Information system that will promote quality jobs, and improving labour standards to ensure fairness for workers.