Canadians are experiencing the widest income gap ever recorded
The widening gap between low- and high-income Canadians has reached record-breaking levels, according to the latest Statistics Canada report.
The report, released in July 2025, examined the income gap, which is “the gap in the share of disposable income” between households in the top 40 per cent and the bottom 40 per cent, and the results were alarming. According to results from the first quarter of 2025, there’s now a record-high income divide of 49 per cent between the two groups, even higher than the 43.9 per cent gap recorded during the pandemic in 2021.
The situation has worsened for Canadians in the bottom 20 per cent of the income distribution. Their disposable income grew by a mere 3.2 per cent as they saw their work hours get cut and their wages decline by 0.7 per cent. To add to that, their investment earnings fell by 35.3 per cent.
Canadians in the middle 60 per cent of the income distribution saw their income increase by only 4.9 per cent.
The rich are getting richer
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But the income disparity is far more evident when comparing low- and high-income households. Whereas Canadians in the bottom 20 per cent only saw their disposable income increase by 3.2 per cent, Canadians in the top 20 per cent of the income distribution saw their disposable income grow by 7.7 per cent, “the fastest pace of any income group.” And they continue to hold the majority of the country’s wealth.
“Most wealth is held by relatively few households in Canada. The wealthiest (top 20 per cent of the wealth distribution) accounted for almost two-thirds (64.7 per cent) of Canada’s total net worth in the first quarter of 2025, averaging $3.3 million per household,” states the report. “Meanwhile, the least wealthy (bottom 40 per cent of the wealth distribution) accounted for 3.3 per cent, averaging $85,700.”
Canadians from low-income households are far more vulnerable to job loss. A Labour Force Survey shows that since 2023, unemployment has been increasing among Canadians aged 15 and older.
That means more and more Canadians rely on lower taxes and money from the government through benefit programs such as social assistance and employment insurance, to help reduce the effects of the loss of income.