Rising income inequality has been at the forefront of public debate in Canada in recent years, yet there is still much to be learned about the economic forces driving the distribution of earnings and income in this country and how they might evolve in coming years.

With research showing that the tax-and-transfer system is less effective than in the past in counteracting growing income disparities, the need for policy-makers to understand the factors at play is all the more urgent.

The Institute for Research on Public Policy, in collaboration with the Canadian Labour Market and Skills Researcher Network, has gathered some of the country’s leading experts to provide new evidence on the causes and effects of rising income inequality in Canada and to consider the role of policy in the new publication Income Inequality: The Canadian Story. Their research and analysis constitutes a comprehensive review of Canadian inequality trends in recent decades, including changing earnings and income dynamics among middle-class and top earners, wage and job polarization across provinces, and persistent poverty among vulnerable groups.

Dr. Tony Fang, Stephen Jarislowsky Chair in Cultural and Economic Transformation at Memorial, along with Professor Morley Gunderson at the University of Toronto, contributed a chapter to Income Inequality: The Canadian Story, which is edited by David A. Green, W. Craig Riddell and France St-Hilaire.

“Given the growing concern over income inequality in Canada and elsewhere, it is important to have information on the transitions into and out of poverty, and the extent to which individuals are vulnerable to being persistently trapped in poverty,” said Dr. Fang. “Using five panels of the Survey of Labour and Income Dynamics spanning the period 1993-2010, this paper documents the long-term trends of poverty dynamics of six vulnerable groups in Canada (Aboriginal Peoples; new immigrants; lone parents; persons with disabilities; unattached persons aged 45-64 living on their own; and youths aged 20-24 not in school) and the main determinants of their transitions into and out of poverty status. Potential policy initiatives are also discussed as relevant for each of the different vulnerable groups.”

The authors also examine the changing role of education and unionization, as well as the complex interplay of redistributive policies and politics, in order to propose new directions for policy. Amid growing anxieties about the economic prospects of the middle class, Income Inequality: The Canadian Story will inform the public discourse on this issue of central concern for all Canadians.