The gap was driven by the top 20 per cent of income earners, who saw the largest increase in their share of disposable income, the report said. That increase was driven largely by investment gains, which the statistics agency attributed to high interest rates.
This is true for me. About 40% of my income came from investments.
The Statistics Canada report said that in the second quarter, the top 20 per cent of Canadians held more than two-thirds of the country's wealth, averaging $3.4 million per household. By comparison, the bottom 40 per cent of Canadians accounted for only 2.8 per cent of Canada's wealth.
This is massively skewed, probably well beyond what most people think and would intuitively envision. Iβve done some work studying businesses and their wealth distributions, what you see is the top 1% is 10x higher than the top 10%, 0.1% is 10x higher than 1%, etc.
Wealth generally creates power law distributions, as the factors that increase wealth multiply wealth, not add to wealth.
I donβt think our government can stop this, as most of my investments are US based. What we can do is try and drive better results for that middle 60% of households who are seeing lifestyle eroded by inflation and stagnant wages (while the floor of minimum wage shifts upwards).
We need to encourage more investment in Canada, and we need to encourage Canadian companies to pay more on-par with US companies. The fact that 60% of CS grads leave and Canadian companies are generally living 20 years in the past is a huge problem for our productivity. We really need bring back manufacturing and high tech work that improves productivity with high leverage.