Virtually no change in income inequality in Canada over the past four decades; increased only 3.6% for top 10% of families from 1982-2022

VANCOUVER, BC, Aug. 28, 2026 /CNW/ -- Despite popular rhetoric to the contrary, there has been little to no change in income equality in Canada since 1982, having increased only by 3.6 per cent among the top 10 per cent of families and actually decreased 0.3 per cent for the top 20 per cent of families, according to a new essay published by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.

"Over the span of four decades this country has seen little to no change in income inequality for Canadian families," said Jason Clemens, executive vice president of the Fraser Institute.

The essay, Definition of Income Matters for Measuring Income Inequality, which is part of a larger series of essays on poverty and inequality, focuses on the differences in the levels of income inequality produced by different definitions of income, as well as how the levels of inequality have changed over time.

The essay explains why it's critical to adjust the measurement of employment income to account for transfers from government to lower- and middle-income families and the effects of a progressive income tax system (both of which are designed to mitigate income inequality) and standardizing family size to better compare like-to-like families.

Such adjustments result in fundamentally different results in both the level of income inequality and how its changed over time. Consider that the top 10 per cent of families received 32.1 per cent of employment income in 2022, the latest year of available data, but only 23.2 per cent of income once it's adjusted for government transfers, progressive income taxes and a standardized family unit.

Similarly, if we only look at the change in employment income received by the top 10 per cent of families between 1982 and 2022, it increased by 17.3 per cent, indicating markedly worsening income inequality. However, the increase declines significantly to just 3.6 per cent once the adjustments outlined above are made to employment income.

The essay also points out that while levels of income inequality--for all measures of income--were increasing between 1982 and 2010, they have declined between 2010 and 2022 to the point where the level of inequality in 2022 is generally comparable to 1982 for most measures of income.

"Too often discussions about income inequality are based on narrow measures of income that ignore existing policies like government income transfers and the country's progressive income tax system, both of which are designed to reduce income inequality," commented Clemens.

"Accurately measuring income is essential to any discussion about income inequality and helps avoid policies that may be well-intentioned but actually result in worsening inequality."

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The Fraser Institute is an independent Canadian public policy research and educational organization with offices in Vancouver, Calgary, Toronto, Montreal, and Halifax and ties to a global network of think-tanks in 87 countries. Its mission is to improve the quality of life for Canadians, their families and future generations by studying, measuring and broadly communicating the effects of government policies, entrepreneurship and choice on their well-being. To protect the Institute's independence, it does not accept grants from governments or contracts for research. Visit www.fraserinstitute.org

SOURCE The Fraser Institute

MEDIA CONTACT: Jason Clemens, Executive Vice President, Fraser Institute; To arrange media interviews or for more information, please contact: Drue MacPherson, Fraser Institute, [phone] Ext. 721, [email protected]