Statistics Canada figures also reveal more women have joined the highest income cohort
Canada’s biggest earners saw their share of overall income grow to a 6-year high according to new figures from Statistics Canada.
The data shows that the top 1% of tax filers saw their share of aggregated Canadian income rise to 10.4% in 2021, from 9.4% a year earlier. The widening of this commonly used measure of income inequality was the largest since 2015.
These high-income individuals saw their earnings (excluding capital gains) grow by 9.4% year-over-year to an average of $579,100 as stock, housing, and labour markets rebounded. Those in the top 0.1% boosted their income by 17.4% to $2,086,100 and the top 0.01% gained 25.7% to $7,731,400.
In the same period, Canadians in the lowest half of income saw an annual decline of $1,400 to $21,100, mostly as government Covid programs ended.
Wages and salaries for the top 1% increased by 12% on average, rising by 24.6% for the top 0.1% and by 34.5% for the top 0.01%.
Dividend income also increased for the highest income cohort.
Those income tax filers who are in the top 1% received an average dividend income of $90,200 (+12.9% compared with 2020), those in the top 0.1% received $429,500 on average (+19.2% compared with 2020) and those in the top 0.01% received $2,009,700 on average (+26.0% compared with 2020).
More women were in the top 1% of income earners in 2021.
This is a long-standing trend and saw the share of women in this group rise to 26.1% from 25.4% a year earlier. In 1982, the share was just 11.4% and it has been growing steadily since.
Capital gains rise sharply
The data also shows a sharp rise in capital gains thanks to strong gains for stock and housing markets.
In 2021, 12.2% of tax filers received capital gains with an average value of $37,600, far higher than in 2020 when average capital gains were $29,300. Although a small proportion of tax filers received relatively large capital gains with 5% of capital gains recipients receiving $131,100 or more, skewing the overall stats.
Average income for the top 1% was $811,800 in 2021, up 20.5% from 2020 and was the highest for 40 years, accounting for inflation. The previous peak was $712,000 in 2007.