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Sharing the Wealth

January 30, 2016 8:14 AM | Columns

By Kate Jackman-Atkinson, myWestman

Canadian Economy

(Canadian economy image via Shutterstock)

NEEPAWA, Man. — In a rich country like ours, the idea that some Canadians are experiencing serious poverty is troubling. Maybe it’s our harsh and unforgiving winters, but Canadians generally have an outlook that favours the collective over the individual. The fact that some of our neighbours go without food or shelter seems decidedly un-Canadian.

I suppose we can take some solace, at least low income Canadians have less to worry about than their neighbours to the south. John Fugelsang, an American political comedian recently said in a comedy show, “America has become a reality show called Food, Medicine, Rent: Pick two.”

Not all poverty is equal. For example, students working part time have low incomes, but provided their basic needs are met, this isn’t really cause for concern. Everyone must start somewhere and as they leave school, enter the work force and grow their skills, they will move into higher income brackets. Our greatest area of concern is those experiencing persistent poverty.

In order to deal with any problem, you must first understand it– how many Canadians are living in poverty, why and for how long? To answer this question, the Fraser Institute looked at Statistics Canada data to get a picture of poverty in Canada. Based on that research, they recently published a report called, An Introduction to the State of Poverty in Canada.

Overall, the researchers found that over the last 20 years, there has been a decline in the percentage of Canadians living in poverty. In particular, the percentage of Canadians living in households below the basic needs poverty line has fallen from 6.7 per cent in 1996 to 4.8 percent in 2009 (the last year in which data is available). Additionally, the percentage of Canadians living in households below Statistics Canada’s low income cut off (LICO) has decreased from a high of 15.2 per cent in 1996 to 9.7 per cent in 2013 (the last year in which data is available). They also found that the incidence of low income has dropped among specific vulnerable groups, such as children, seniors and persons in lone-parent families. Some of the changes have been dramatic. For example, the rate of low income among seniors has fallen from 29 per cent in 1979 to 3.7 per cent in 2013.

The study looked to go beyond this snapshot to find out how many Canadians were experiencing short spells of low income, versus those who were stuck there for longer periods of time.

The study found that a significant portion of Canadians in low income one year aren’t in it the next. For example, over 36 per cent of Canadians with income below the LICO in 2009 were above the LICO in 2010. These are Canadians who are experiencing temporary hardship, for example, they lost their job but have found a new one. According to Stats Can, between 2002 and 2007, 2.4 years was the average time Canadians spent in low income.

Which leads us to those experiencing longer spells of low income. According to Stats Can research, 1.5 percent of Canadians were in persistent low income from 2005 to 2010. The good news is that this number has been falling since the 1990s. Between 1993 and 1998, 3.6 per cent of Canadians were experiencing persistent low income.

The research shows that certain characteristics, such as a mental or physical disability, being part of a lone parent family, being single, being a visible minority immigrant or having less than a high school education, lead to a higher risk of experiencing long-term low income. Over the last few years, a number of programs have been implemented to target these areas and I hope that the decline means that these programs are working.

The data shows that we are making progress in the fight against poverty, but clearly, more can be done to help those for whom poverty is a long term challenge. I hope that this, and subsequent research leads to a better understanding of persistent poverty and the ability to better target our efforts towards those who most need our help. In every sense, Canada is a land of wealth; Canadians want to make sure that this wealth is shared with our most vulnerable citizens.