Canada’s wealthiest increased their net worth at the fastest pace of any household group in the first quarter of 2024, widening the disposable income gap between households in the top and bottom of the income distribution to the largest gap seen since 2008.
The findings from Statistics Canada are included in the report, Distributions of household economic accounts for income, consumption, saving and wealth of Canadian households, first quarter 2024.
They say the income gap widened to the highest rate seen since 2008, as debt charges weighed on lower and middle-income households.
Higher wages
Lowest income households in the bottom 20 per cent of the income distribution had above-average gains in disposable income as higher wages offset increased interest payments on mortgages and credit cards. Disposable income for those in the middle 60 per cent of the income distribution decreased, and average disposable income for the highest income households increased at a faster-than average pace in the first quarter of 2024, thanks to gains in investment earnings.
Despite the gap, lower and middle-income households improved their net savings for the first time in three years during the quarter.
“Most wealth is held by relatively few households in Canada,” the report states. “The wealthiest (top 20 per cent of the wealth distribution) accounted for more than two thirds (67.6 per cent) of Canada’s total net worth in the first quarter of 2024, averaging $3.4-million per household, while the least wealthy (bottom 40 per cent of the wealth distribution) accounted for 2.8 per cent, averaging $70,356. The gap in wealth between the top 20 per cent and the bottom 40 per cent reached 64.8 per cent in the first quarter.”
