Canada gets low grade on income inequality, poverty

by | Feb 4, 2013 | News

Canada gets "middle-of-the-pack" rating on various socioeconomic factors in a report released Monday.

Canada gets “middle-of-the-pack” rating on various socioeconomic factors.

By Sharon Tindyebwa

Canada is lagging behind other countries in poverty reduction and income inequality, according to a Conference Board of Canada report released Monday.

The report, which surveyed 17 developed countries on various socio-economic factors, ranked Canada seventh on the list and gave it an overall B grade.

While Canada performed well in certain areas such as homicide rates, cultural diversity and life satisfaction, the group said the “middle-of-the-pack” rating left room for improvement.

“We have a view of ourselves as Canada being a kinder, gentler nation,” Brenda Lafleur, author of the study and director of the Conference Board, told Humber News.

LISTEN: Interview with Miles Corak

“We tend to compare ourselves to the U.S. and compared to them we get a better rating,” Lafleur said, but compared to other similar countries, Canada did not fare as well.

Areas that received low ratings included child poverty rates, income inequality and youth employment.

Canada received a grade of C for child poverty, ranking 15th out of the 17 countries assessed.

The report said Canada had consistently received a C for child poverty since the 1980s, while Denmark, Finland, Norway and Sweden had steadily received A ratings.

“It doesn’t actually seem Canada’s ranking in child poverty rates has changed that much,” noted Miles Corak, a professor of economics at the University of Ottawa.

“The country certainly does better than the United States in this regard but most countries do. Compared to many other European countries, not so well,” he said.

Corak told Humber News the increasing turbulence in the labour market has played a role in the child poverty rate.

Canada also received a C for income inequality, coming in 12th place for the growing gap between the country’s top earners and the rest of the population.

Rise in inequality

“Canada experienced over the last 20 or 30 years significant increases in inequality and particularly the top 1 per cent. Increases that are much higher than what the OECD has experienced on average,” Corak said.

Canada also fared poorly in youth employment and the gender income gap.

“Many Canadians seem to regard poverty as something that is an issue “over there” rather than in their own country,” the report said. But Canada’s ratings in certain levels of employment and earnings show Canada could do better.

“If you are not living in an area that [poverty’s] right in your face, most people aren’t thinking about it,” Lafleur said.

“We tend to see ourselves as a socially responsible and wealthy country and that’s true, but this is something we need to look at,” she added.

The report put emphasis on education as a way to help Canada improve its rating in many of the problem areas.

“If there is a main message that this report gives is Canada has to spend more money and focus on education,” Lafleur said.