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Gap Between Rich and Poor
Elderly (65 years of age and older)
Poverty Rate
Significance
• The distribution of income in a society is important for
identifying social inequalities.
• A large gap between the rich and the poor implies a
society is not particularly equitable, while a small gap
implies a more fair society.
Core Indicator
• The poverty rate is one way to assess how many people
are at the lower end of the distribution of income.
• The elderly poverty rate is especially relevant because
the baby boom generation is aging quickly, which implies
that this indicator will affect an increasing share of the
population in years to come (approximately ¼ of the
population).
• Elderly poverty rate will soon be one of the most
prominent issues for Canadian society and policy
makers.
Three Measures of Poverty
• Statistics Canada produces three measures of poverty:
– The Low Income Cut-Off (LICO)
– The Market Basket Measure (MBM)
– The Low Income Measure (LIM)
• Each measure is important, as they each tell a slightly
different story about elderly poverty in Canada (see
following chart).
LIM vs. LICO vs. MBM
• LIM is a relative measure of poverty, whereas the MBM
and the LICO are absolute measures of poverty.
• According to the:
– LIM, a family is poor if their income is less than one-half of the
median income of an equivalent household.
– LICO, a family is poor if they are expected to spend 20% more
than the average family on food, shelter and clothing.
– MBM, a family is poor if they do not make enough money to
meet “creditable” community norms, such as housing
transportation, clothing, and other things.
Elderly Poverty Rate in Canada, After
Tax, 2000 and 2010
7.6 7.6
3.4
12.3
5.3
4.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
LIM LICO MBM
2000 2010
Source: Statistics Canada, CANSIM Table 202-0802 (SLID)
Overall Poverty Decreasing
• In general, absolute poverty appears to be decreasing
over the long-term
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
LICO LIM MBM
Source: Statistics Canada, CANSIM Table 202-0802 (SLID)
Canada’s Major CMAs
When we look closer at Canada’s largest census
metropolitan areas (CMAs) the three poverty measures
(LIM, LICO & MBM) tell slightly different stories about
elderly poverty:
-LIM indicates that relative elderly poverty increased from
7.6% in 2000 to 12.3% in 2010.
-LICO shows a decrease of 2.3% from 7.6% in 2000 to 5.5%
in 2010.
-MBM reveals that elderly poverty has remained relatively
stable at 4% in 2010.
Elderly Poverty Rates in Major CMAs based
on LIM, After Tax, 2000 and 2010
0.0
2.5
5.0
7.5
10.0
12.5
15.0
2000 2010
Source: Statistics Canada, CANSIM Table 111-0015 (CRA)
Elderly Poverty Rates in Major CMAs based
on the LICO, After Tax, 2000 and 2010
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
Montréal Vancouver Québec Winnipeg Toronto Hamilton St. John's Canada Ottawa Halifax Victoria Calgary Edmonton
2000 2010
Source: Statistics Canada, CANSIM Table 202-0802 (SLID)
Elderly Poverty Rates in Major CMAs based
on the MBM, 2000 and 2010
0.0
2.0
4.0
6.0
8.0
10.0
12.0
2000 2010
Source: Statistics Canada, CANSIM Table 202-0802 (SLID)
Trouble in Canada’s Three Largest Cities
• Regardless of the different stories told by the three
different poverty measures, Canada’s three largest
cities – Toronto, Vancouver and Montréal – were all well
above the national average for measures of absolute
elderly poverty rates in 2010.
• On the bright side, Alberta is doing well. Both Calgary
and Edmonton had exceptionally low elderly poverty
rates. This could be due to the booming Albertan
economy.
