Conference Board: Age, not gender, is the new income divide in Canada

Age, not gender, is increasingly at the heart of income inequality in Canada, says a new study that warns economic growth and social stability will be at risk if companies don’t start paying better wages. The Conference Board of Canada findings suggest younger workers in Canada are making less money relative to their elders regardless of whether they’re male or female, individuals or couples, and both before and after taxes. The average disposable income of Canadians between the ages of 50 and 54 is now 64 per cent higher than that of 25- to 29-year-olds, the report found; that’s up from 47 per cent in the mid-1980s. Conference Board Vice-President David Stewart-Patterson, one of the study’s co-authors, said the economic think tank was motivated to undertake the study due to a wealth of “anecdotal evidence” that suggests Canadian youth are falling behind economically.

Our report provides some pretty persuasive, quantitative evidence that yeah, there really is a systemic pattern here. These aren’t just stories of individuals—there really is a pattern that’s unfolded over a prolonged period, a pattern which has some disturbing implications going forward.

David Stewart-Patterson, Conference Board vice-president

Stewart-Patterson pointed out that top Canadian earners fought for principles of equal work for equal value, yet their children now face lower wages and reduced pension benefits even if they’re doing the same work at the same employer. The trend is particularly troubling, he added, because as the baby-boom generation moves into retirement, Canadians will be relying on a smaller share of the population to drive economic growth and sustain the tax base that supports public services. Canada therefore needs average employment incomes to rise, not fall behind, in order to pay for the increasing health care costs of the baby-boomer generation, among other expenses, Stewart-Patterson said.

We are moving into an era where people of working age are going to be increasingly scarce; that should put upward pressure on wages going forward.

David Stewart-Patterson

Canada income Business