For all the hue and cry over Canada's richest one per cent, little is known about just who they are.
A paper released last week by University of British Columbia economics professors sheds new light on income inequality trends in Canada, who the top earners are and what policies might best address the country's growing income gap.
They find, broadly speaking, that income distribution has not been this uneven in Canada since "the dark days of the Great Depression."
"The ratcheting-up of inequality in Canada is real," the 43-page paper says. "Whatever else it achieved, the Occupy movement shone a light on our growing inequality."
Income inequality has been hotly debated in the past year, and a raft of recent studies has shown it is widening in most advanced economies. Growing income disparity has been linked with deteriorating outcomes for health-care, crime and long-term economic growth.
In Canada, about eight per cent of the country's total income was concentrated in the hands of one per cent of the population back in the late 1970s. In recent years, that almost doubled to 14 per cent, the UBC paper said, which is based in part on details from the 2006 long-form census.
Reasons for the growing chasm vary. The wage gap between those with a university degree and those with just high school is widening. Younger workers are facing worse earnings prospects than a generation ago. Outsourcing, declining unionization rates and technological change may also be playing a role.
Policies that could narrow the gap include closing tax loopholes, hiking taxes on the richest one per cent and increasing refundable tax credits to lower-income Canadians, the authors say. Making the education system more flexible and reducing high school dropout rates could help support the middle class.
Here are some more of the findings from the study, titled "Canadian Inequality: Recent Development and Policy Options":
The top one per cent of earners amount to 275,000 individuals.
Fifty-two percent of people in the top one per cent work at least 50 hours a week, compared to less than 20 per cent for the overall population.
One needs an annual income of at least $230,000 to be part of the top one per cent. The average income in this group is $450,000, compared to only $36,000 for the whole Canadian population.
One could safely call this a brotherhood -- 83 per cent of those in the top one per cent are men. "So despite the significant gains realized by women over the last few decades, they remain dramatically underrepresented at the very top of the income distribution."
Young people (under age 35) are also underrepresented in the top income group, though this may just be transitory as most haven't yet reached their peak life-cycle earnings.
Fifty-eight percent of individuals at the top have at least a bachelors' degree, a greater proportion than the broader population, where 19 per cent of the adult population are university graduates.
Top earners hail from a variety of sectors. Just 10 per cent of people in the top one per cent work in the finance and insurance industry (despite garnering most of the public's wrath). Senior managers and CEOs are over-represented in the top group, but still only account for 14 per cent of top earners. The only other large group of top income earners? Physicians, dentists and veterinarians who comprise almost 10 per cent of top earners, despite representing less than one per cent of the workforce.
The paper was jointly written by UBC's Nicole Fortin, David Green, Thomas Lemieux, Kevin Milligan and Craig Riddell for the Canadian Labour Market and Skills Researcher Network.
This article is republished with permission from The BC Federationist, the online newspaper of the BC Federation of Labour.
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BG
49 weeks ago
"Younger workers are facing
"Younger workers are facing worse earnings prospects than a generation ago. Outsourcing, declining unionization rates and technological change may also be playing a role."
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Reducing outsourcing will reduce income inequality. Encouraging more education is good of course, but there must be good paying jobs for those without university degrees - manufacturing jobs.
Outsourcing happens because of trade deals. I don't know why our government allows free trade with the Chinese dictatorship - a country that allows corporations to treat its citizens like slaves and has no environmental regulations.
We undermine our own democracy by trading with the Chinese dictatorship. We're going to have to stop trading with China until they become a democracy and respect human rights.
Free trade with democracies only.
Okanagan Orchardist
48 weeks ago
The March issue of "CANADIAN BUSINESS"...
Lists the top 100 rich people in Canada:
1. Thomson family (13th year in a row) --$21billion.
2. Galen Weston-- G. Weston Ltd, Loblaw --$8b
3. James Irving & estate --Irving Oil --$7.8b
4. Rogers family -- Rogers Comm. -- $5.94b
5. James Pattison -- Canfor; billboards -- $5.73b
6. Saputo family -- Montreal dairy --$4.34b
7. Paul Desmarais -- Power Corp. --$4.27b
8. Jeff Skoll -- former pres. eBay --$3.75b
9. Fred & Ron Mannix -- mining, etc --$3.44b
10. Bernard Sherman -- generic drugs --$3.31b
Note that these are individuals and not corporations. Surprisingly, some of them are also philanthropists.
44% live in Ontario. BC has only 10%.
The US has 412 billionaires, Canada has 61. Russia has 101; China has 115; surprisingly, Switzerland has only 9; UK has 32; Saudia Arabia has 8; Israel, with a pop. of 7.7 million, has 16. Another factoid: the net worth of the Canadian rich 100 = $193 billion; compare to Finland, whose 2010 GDP was $186 billion. What toys are they buying? Apparently they like yachts -- over 200 feet with helipads.
Others, like Andreas Apostolopoulos from Toronto, bought the Pontiac Silverdome stadium in Michigan.
Hakuin
48 weeks ago
in Mexico
the children of the one percent are taught from birth to wear grubby clothing and to appear unkempt when they must move on foot unescorted in public. Can you imagine why?
pwlg
48 weeks ago
galen[s commercial with work shirt and jeansl
what next for this multi-billionaire to show he's just a regular guy making $40,000 an hour?
Vox.Pop
48 weeks ago
Canada's Bureaucratic Elite
Many new members of Canada's elite are administrators at public institutions like universities, hospitals & governments. These people identify with their corporate brethren, viewing the world through the same dark glasses & feeling that they deserve their outsized salaries & perks. Worse, since they see themselves as CEOs, they operate 'their' institutions as if they were bottom-line, profit-oriented corporations. There is a need for massive house-cleaning amongst this tiny group. The fastest way would be to limit their annual incomes to $100,000 - they would resign en masse, solving two problems at once.
There would be no shortage of dedicated people as suitable replacements.
Vox.Pop
48 weeks ago
Overpaid Scientists
I forgot to include the overpaid scientists that have joined Canada's elite. People would be surprised to discover their huge salaries & how little they have actually contributed to improving the lives of their fellow Canadians. Too many of them have pursued a scientific career for the crass benefits & there would be a minimal impact on Canada if most of these people had never followed this course. Better if they had become bankers or even vets.
Once again, reducing the pay for these jobs would drive away those who only want a well-paid, secure job; leaving the few creative individuals who would pursue the 'search for the truth' for the joy of discovery - as it used to be 60+ years ago.
freebear
48 weeks ago
We are all overpaid
and Planet Earth can not afford us!
snert
48 weeks ago
Hakuin
Maybe because their parents are wise enough to realize that it's not necessarily a good of an idea to attract attention to one's self in certain places.
This would also be a wise move for just about anybody, don't you think?
I hate to point out this fact but the wealthy are not inherently evil.
snert
48 weeks ago
Just another silly lopsided article with no balance.
These articles should never be allowed past the upload command unless they are balanced out by showing just what the top 1% actually does with all their wealth.
I've seen some pretty bizarre examples of spending gone wild but a lot of it has been attributed to the Arab extravaganzas in the middle east or drug lords getting tired of seeing all that money piled up in a corner.
Maybe The Tyee would like to acknowledge this imbalance of opinion for once and explain to the angry .0001% just what 'wealthy' people like Warren Buffet and Bill Gates actually do with their billions. I'm pretty sure that it would scale down to Canada's top 1%.
Who "they" are is not important. What "they" do with their wealth might be of interest.
Hakuin
48 weeks ago
life in a class stratified society
is not the vision I have for my country. I didn't grow up in one and I am not about to let the few turn it into such.
Jeffrey J.
48 weeks ago
Democracy vs Aritstocracy
Our choice is simple. Do we choose democracy, where the public good prevails over private gain, or do we wish to live in an aristocracy, where the royal few rule over the masses?
The history of democracy is long. From ancient Athens to 999 Iceland to 1492 Iroquoia Nation to 1776 USA to 1789 France. People will ALWAYS choose democracy over servitude, slavery and minority rule. It has always been about freedom. Real freedom, where people have a choice how they will live, not the rigged monopolized corporate "free market"
What is our choice? This is what we must decide.
Great coverage.
Sask Resident
48 weeks ago
Hockey Players
No mention of sports and media types? In the US, the highest paid CEOs are not the Jimmy Diamons (JP Morgan) but the chief honchos of the media groups like Disney, NBC, etc.
In Canada, many of the top earners are NHL hockey players, the odd ball player, and actors, but for some reason the general public thinks it is okay for them to make lots of money.
In BC, the heads of crown corps are paid almost more than anyone except maybe the heads of health regions.
stevenM
48 weeks ago
"In Canada, many of the top
"In Canada, many of the top earners are NHL hockey players, the odd ball player, and actors, but for some reason the general public thinks it is okay for them to make lots of money."
You'd be surprised. Professional athletes generally go broke a few years after retirement and their careers are very short.
Actors in Canada make nothing. There's no money in Canadian acting.
"In BC, the heads of crown corps are paid almost more than anyone except maybe the heads of health regions"
You better believe it. In BC, working for the government is better than owning a gold mine.
http://www.vancouversun.com/business/public-sector-salaries/Number+public+servants+earning+more+than+jumps+cent+years/3172773/story.html
Hakuin
48 weeks ago
have a look ahead
http://www.guardian.co.uk/world/greek-election-blog-2012/2012/jun/13/greeces-super-rich-low-profiles
snert
48 weeks ago
Hakuin
And what country were you born in? It couldn't have been Canada. There has always been class distinction, just a more subtle variety.