Per Capita Income in Canada

[jdobbin]

http://www.ctv.ca/servlet/ArticleNews/stor...1122?hub=Canada

OTTAWA -- Income per capita grew significantly faster in Canada than it did in the United States between 2000 and 2006.

Statistics Canada reports that real income per capita in the United States grew by 9.1 per cent, while in Canada real income per capita grew 15.5 per cent, nearly two-thirds faster.

The agency says that's just the opposite of the situation prior to the turn of the millennium, when commodity prices were weak and the Canadian dollar was depreciating.

The study showed that a long downward trend in Canada's fortunes prior to 1999 was reversed in short order.

In three short years, real income relative to the United States returned toward mid-1980s levels and much of this "reversal of fortunes'' was due to Canada's resource economy.

I think one of the criticisms of the past Liberal government was that per capita income wasn't increasing fast enough. I guess this report should put that to rest.

http://www.statcan.ca/Daily/English/071122/d071122b.htm

[jawapunk]

Where the hell is my share?

[mikedavid00]

I think one of the criticisms of the past Liberal government was that per capita income wasn't increasing fast enough. I guess this report should put that to rest.

The gov't has little to do with the world economy. (in context).

Stop thinking the gov't is our Daddy that can control the world.

[jdobbin]

Where the hell is my share?

I think Conrad Black has your share. Sorry.

[M.Dancer]

I accept responsibility. I have had a rather good run for the last couple of years, so I have skewed the averages somewhat.

[Michael Hardner]

That's quite an interesting graph.

Of course the productivity numbers are completely alarming, but let's accentuate the positive shall we ?

Morris, I thought you were laid off a year or two ago. How much was in your tip jar anyway ?

[M.Dancer]

That's quite an interesting graph.

Of course the productivity numbers are completely alarming, but let's accentuate the positive shall we ?

Morris, I thought you were laid off a year or two ago. How much was in your tip jar anyway ?

I have been employed at the same agency for 15 years. For an anniversary gift the company is sending the Mrs and me to an all expense paid long weekend at the Prince of Wales in Niagara on the lake. In that instance, the tip is around $3,000

[White Doors]

Where the hell is my share?

get a job

[Topaz]

Could that fact be that, the US minimum wage isn't growing like we have over here? Not all states have the same min.wages and few are equal to ours but alot are just getting to 6.oo mark. Also, how many people over there have COLA, which really helps when the gas, hydro etc. go up?

[geoffrey]

get a job

Move to Alberta rather.

[Riverwind]

Of course the productivity numbers are completely alarming, but let's accentuate the positive shall we ?

Can anyone explain why the productivity and real income per capita are inversely proportional? We have been led to believe decreasing productivity means lower income per capita and this graph shows the opposite before 1990 and after 1998. Is it is co-incidence that those years are also the years when governments spending was cut back?

[August1991]

I think one of the criticisms of the past Liberal government was that per capita income wasn't increasing fast enough. I guess this report should put that to rest.

On the contrary. There are facts, statistics and damn lies.

The StatsCan daily chooses "Net National Income" to produce its graph and CTV for its comparison. That's cherry-picking.

As the StatCan link explains, Net National Income (NNI) corrects for the "terms of trade". IOW, we're richer because the world wants oil and we have oil. (NNI also includes income from abroad and depreciation.) Frankly, I'll stay with GDP per capita.

Or rather, I'll stay with lifestyle. Americans live well. Most Canadians too. Most people around the world want to come to Canada (America). For example John Lennon chose to live in North America and even Paul McCartney has a place in Connecticut.

Can anyone explain why the productivity and real income per capita are inversely proportional?

These statistics are hard to distinguish. Labour productivity means each worker produces more. Real income per capita means each person gets more.

If a room has two pianos and both play the same note at the same time, which piano made the sound?

Edited November 23, 2007 by August1991

[bush_cheney2004]

Can anyone explain why the productivity and real income per capita are inversely proportional? We have been led to believe decreasing productivity means lower income per capita and this graph shows the opposite before 1990 and after 1998. Is it is co-incidence that those years are also the years when governments spending was cut back?

Nope...it's a good question that confounds even the experts. See this National Bank Financial analysis:

http://www.fxstreet.com/fundamental/analys...2007-03-26.html

(Open PDF file)

Edited November 23, 2007 by bush_cheney2004

[Riverwind]

Nope...it's a good question that confounds even the experts. See this National Bank Financial analysis:

Thanks

[White Doors]

Move to Alberta rather.

Been there, done that - bought the T-shirt and am grateful.

But have zero desire to go back.

thanks for all the $$ though Geoff!

[White Doors]

On the contrary. There are facts, statistics and damn lies.

The StatsCan daily chooses "Net National Income" to produce its graph and CTV for its comparison. That's cherry-picking.

As the StatCan link explains, Net National Income (NNI) corrects for the "terms of trade". IOW, we're richer because the world wants oil and we have oil. (NNI also includes income from abroad and depreciation.) Frankly, I'll stay with GDP per capita.

Or rather, I'll stay with lifestyle. Americans live well. Most Canadians too. Most people around the world want to come to Canada (America). For example John Lennon chose to live in North America and even Paul McCartney has a place in Connecticut.

These statistics are hard to distinguish. Labour productivity means each worker produces more. Real income per capita means each person gets more.

If a room has two pianos and both play the same note at the same time, which piano made the sound?

Just a guess, but alot of this woupd probaboly have to do with record levels of the population participating in the workforce too?

[geoffrey]

Been there, done that - bought the T-shirt and am grateful.

But have zero desire to go back.

thanks for all the $$ though Geoff!

It's not for everyone, but that's where the money is at if anyone's looking. I was thinking about making a switch to Toronto this summer, won't make nearly as much and my expenses would be about the same. Why would I do that? Plus the lifestyle is so much more work focused in TO. Ugh.

[jdobbin]

On the contrary. There are facts, statistics and damn lies.

The StatsCan daily chooses "Net National Income" to produce its graph and CTV for its comparison. That's cherry-picking.

As the StatCan link explains, Net National Income (NNI) corrects for the "terms of trade". IOW, we're richer because the world wants oil and we have oil. (NNI also includes income from abroad and depreciation.) Frankly, I'll stay with GDP per capita.

Or rather, I'll stay with lifestyle. Americans live well. Most Canadians too. Most people around the world want to come to Canada (America). For example John Lennon chose to live in North America and even Paul McCartney has a place in Connecticut.

Here is what the Report on Business said about it all:

http://www.reportonbusiness.com/servlet/st...al_gam_mostview

"There is no question that there is very significant wealth creation going on in Canada," said Andrew Auerbach, senior vice-president and chief operating officer of BMO Harris Private Banking in Toronto. "From coast to coast, it has been a very busy year."

The increase in incomes helps explain why traditional measures of economic health, such as gross domestic product, have progressed modestly, but at the same time, Canadian retail sales are up, government surpluses and corporate profits have hit records, and job creation continues at a torrid pace.

"If you have a skill, a trade, it's 'How much work do you want to do today?' " Kelowna architect Thomas Gaffney said.

"People used to go to work on a Saturday just to make ends meet. Now, you've got guys who are 25, who are saying, 'Hey, I've got a family, I'm going skiing, so, no, I won't work a Saturday.' "

The growing wealth has trickled through even to the health-care sector and helped the Ottawa Hospital invest, expand, hire and attract the attention of global experts, senior vice-president Peggy Taillon said.

"You see the community really rally around the hospital. They really want their local hospital to be state of the art," she said. "The benefactors are coming back to health care because there is a very good chance they'll need those services."

Before 2000, Canada's economic momentum sorely lagged behind the United States, by any measure. In the 1980s and 1990s, Canada's resource economy was flagging, commodity prices were declining and Canadian investors were sending far more money out of the country than they were receiving.

The turning point was in 2002 and 2003. Commodity prices picked up, the Canadian dollar climbed and, as Ottawa lifted restrictions on foreign investment, Canadian investors took a keen interest in investing around the world.

At the same time, China and India were joining the global economy, buying up commodities Canada produces in abundance and cranking out cheap manufactured goods.

"What we're selling, the value is rising. What we're buying, the value is dropping," Mr. Macdonald said.

The United States has not benefited from the rise in commodity prices because it is mainly an importer of natural resources, and so its income has not flourished as Canada's has, he said.

And then an explanation of how the stats are in keeping with new OECD measures.

By the numbers

-Real income grew 15.6 per cent between 2002 and 2006 - nearly two-thirds faster than in the U.S. - largely because of Canada's booming 'resource economy.' Prior to the millennium, when commodity prices were weak and the dollar was depreciating, real income was falling steadily.

-While armchair economists argue over the best way to measure and compare a country's standard of living, the OECD has made its latest attempt - and Canada looks more comfortable than most, by any measure.

-Calling the traditional measure - gross domestic product per person - clumsy, the OECD points to a new indicator called actual individual consumption. First, it adjusts real GDP per capita to reflect a country's exchange rate and comparative prices, then it determines how much of that income households consume.

[August1991]

I don't think that anyone here is saying anything contradictory. Canada is doing well and by and large, so is the US. For the past 15 years or so, both economies have chugged along generating real growth, lifting people out of poverty, making more people homeowners, raising their incomes and making them less fearful of the future. We are better off - somewhat.

I think that I objected to the idea that Canada has performed better than the US. By choosing the arbitrary measure of "Net National Income", they cherry-picked a measure that gave them the result they wanted. A different measure would give a different result.

I happen to prefer real GDP per capita for historic comparisons and GDP per capita at PPP for international comparisons. By that measure, Canada still lags behind the US.

As noted above in this thread, the falling productivity measure should be a source of concern in Canada. In the long run, our ability to create wealth depends ultimately on our ability to work better. We can do that by trading freely and by using wisely new technologies and ideas. The stats seem to indicate that much of our recent growth in incomes is due to our natural resources: we have what the world wants. Well, Saudi Arabia is a rich society but their wealth is not based at all on their productivity.

----

There's a subtext here, Dobbin. You (and Statscan, I suspect) are trying to imply that the Liberals were good, economic managers. I disagree. Our current good fortune is the result of Brian Mulroney negotiating free trade, bringing in the GST and perhaps most of all, the change in the Bank of Canada in the early 1980s.

The next big change will be to change the way governments work. This has been tried by Charest, Gore, Tony Blair, even Paul Martin and in NZ. No one really knows what to do.

Does this matter? Yes it does. Most of the growth of the past 15 years or so has been consumed by governments. Real median disposable income hasn't changed much, whether in Canada or the US.

[jdobbin]

There's a subtext here, Dobbin. You (and Statscan, I suspect) are trying to imply that the Liberals were good, economic managers. I disagree. Our current good fortune is the result of Brian Mulroney negotiating free trade, bringing in the GST and perhaps most of all, the change in the Bank of Canada in the early 1980s.

The next big change will be to change the way governments work. This has been tried by Charest, Gore, Tony Blair, even Paul Martin and in NZ. No one really knows what to do.

Does this matter? Yes it does. Most of the growth of the past 15 years or so has been consumed by governments. Real median disposable income hasn't changed much, whether in Canada or the US.

I was going to suggest that there has been a combined effort since the late 1980s to now that has gotten Canada to this point. You prefer the measure of the looking at the GDP by itself. I think there is some sense in looking at the OECD way of looking at the actual individual consumption. It tells more about each country's circumstances.

The right wing for many years has been trying to indicate that Liberals mismanaged the economy. These numbers from Stascan using the OECD system show that this is not the case. A lot of it is due to recovery in resources but there has been better fiscal responses from the provinces and the feds over the years as well.

Lots still needs to be done but the idea that the Liberals were taking the country down the garden path doesn't wash.

[White Doors]

It's not for everyone, but that's where the money is at if anyone's looking. I was thinking about making a switch to Toronto this summer, won't make nearly as much and my expenses would be about the same. Why would I do that? Plus the lifestyle is so much more work focused in TO. Ugh.

I was there for 11 years, I liked it - just not as much as here.