Statistics Canada finds less income mobility across generations

By James Langton | March 17, 2020 | Last updated on March 17, 2020
1 min read
Family walking in the country
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Canadians born into high-income families tend to grow into high-income adults, and those born into low-income families tend to remain low income, Statistics Canada says. Middle-class Canadians have the greatest economic mobility.

For Canadians born into the bottom 20% of families by income between 1963 and 1979, a StatsCan study found that 31.9% remained in the bottom income quintile as adults, whereas only 10.0% reached the top 20%.

Similarly, for those that were born into the top 20%, more than one-third (35.5%) remained in the top 20% as adults.

Just 12.8% of those born into high-income families slipped into the bottom 20% as adults.

Mobility was greatest for those born to middle-income parents, StatsCan said.

It found that 19.7% ended up in the bottom 20%, 16.9% ascended to the top 20%, and 20.3% remained in the middle.

“These people faced the highest level of intergenerational mobility: their economic outcomes were the least related to those of their parents,” StatsCan said.

The study also found that intergenerational mobility is on the decline.

“Parental income mattered more for the incomes of Canadians born from 1977 to 1983 than it did for those born from 1967 to 1976, indicating that intergenerational mobility was lower in the more recent cohort,” it said.

Despite the recent decrease in mobility, StatsCan reported that Canada remains a relatively mobile country by international standards.

For instance, income mobility is higher in Canada than it is in the U.S., it said.

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James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.