Richest Canadians earn ten times the average

The top one per cent of earners in Canada have seen their salaries increase 80 per cent since 1986 while the bottom 90 per cent of earners saw gains of only 19 per cent. That means the very rich are getting richer and everyone else has seen very little gain.

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“Some people think this is very worrisome because we might have a growing elite that has growing economic and perhaps other kinds of power,” says Michael Veall, economics professor at McMaster University. “Other people don’t worry so much because the inequality is so narrow and so focussed at the top end.”

Globalization good for the rich

Globalization means top earners are in demand around the world and can command big salaries. They include executives, elite athletes, doctors, dentists, lawyers, real-estate agents, architects and engineers.

Other workers have suffered from globalization in that their jobs can be moved to other countries where salaries are lower. Jobs have been lost and other jobs have become precarious. In the past someone could work for the same company through their career. That is much less likely now.

Hard to tax the rich

How to adjust to the growing power of elites is something Veall says Canadian society must consider. He adds there may be issues around poverty in future and raising taxes to deal with some of them may prove difficult.  If you tax the rich in one province, Veall points out, elites can simply move to another.

Health and education spur social mobility

Canadians have enjoyed social mobility because of a good education system and free health care, says Veall. He is concerned that new technologies are increasing costs for health care and that cash-strapped provinces will reduce services in that field and in education.

He is however not pessimistic about Canada’s future. “Canada still stacks up very well against other countries but I don’t think it’s going to be as prosperous or at least have the same rate of growth as it has had over the last 30 or 40 years.”