Stats Can revises 30 years of data on the income of Canadian Households

Statistics Canada released revised data on the income of Canadian households for 1981 though 2010.

Statistics Canada released revised data on the income of Canadian households for 1981 though 2010. The data, from the revised Canadian System of National Accounts  (CSNA12) allows for a more precise measure of Canadian household income;under the previous version of the CSNA, certain institutions, including non-profits serving households, Aboriginal general governments and some co-operative institutions were not distinguished from households.  While the revised data paints much the same picture of Canadian households as the previous system, the advent of better measures merits a look back at the three decades in between 1981 and 2010.

Throughout the period, households derived the largest part of their income from employee compensation, 76% percent throughout.  Between 1981 and 2010, benefits outgrew salaries; by the end of the period employee benefits represented 13.3% up from 8.7% in 1981.

Greater change was evident from the growth in Net mixed income—income from self-employed or self-directed activity. Net mixed income increased from 12.9% in 1982Q2 to 13.4% in 2009Q2.The growth in net mixed income can be attributed to the increased number of people who became self-employed in the 1990s and the increased importance of rental income. The growth was however offset by the decline of farm income, which decreased 1.1 percentage points to less then 1% share. The decline in farm income at the household level also reflects trends in agriculture, as fewer farms were operated by sole proprietors in 2010 (55% of farms) as were in 1981 (87%).

Outside of income from employment, income from property, which includes investments, saw a decline to 9.0% of primary income in 2009Q2 from 11.8 in 1991Q1, its highest level in the period. Among the components of income from property, the importance of interest has decreased by as much as half in the period while the share of dividends has nearly doubled.

Also covered in the revised data is the role of transfers, both received and paid. In both cases, the three decades ended 2010 saw an increase in the importance of social insurance, contributions and benefits. In terms of transfers received, social security benefits more than doubled while Employment Insurance benefits, which in the period saw the wage replacement rate decrease from 60% to 55%, decrease by more than half as share of household income.

In terms of transfers paid, transfers paid to governments have largely remained the same in the period, 94%, but the make up has changed; personal income tax has decreased, however social insurance contributions have increased so the sum change is negligible.