Canada’s income and wealth inequality deepened in 2025, as gains in financial markets disproportionately benefited higher-income households while lower-income groups faced slower wage growth and reduced investment returns, according to new data released by Statistics Canada on Monday.
The report shows that the income gap measured by the difference in disposable income share between the top 40 per cent and bottom 40 per cent of households rose to 46.7 percentage points in 2025, up slightly from 46.4 percentage points the previous year.
The widening disparity reflects uneven economic conditions. Lower-income households experienced weaker wage growth compared to the national average and saw declines in investment income, largely due to reduced interest payments on savings. In contrast, wealthier households benefited from strong financial market performance.
Wealth inequality also remained stark. The top 20 per cent of Canadians held 65.7 per cent of the country’s total net worth by the end of 2025, with an average household wealth of $3.5 million. Meanwhile, the bottom 40 per cent controlled just three per cent of total wealth, averaging $81,650 per household. This pushed the wealth gap between these groups to 62.7 percentage points, a 0.6-point increase from the previous year.
Separate findings from insolvency firm MNP Ltd. highlight how this divide is being felt in everyday financial realities. While the firm’s debt index suggests overall financial stability has held steady, pressures remain unevenly distributed.
According to MNP’s latest survey, Canadians reported having an average of $1,000 left at the end of each month as of March a record high, up from $907 in November. However, the data also reveals underlying vulnerability: 43 per cent of respondents said they are within $200 or less of being unable to meet their monthly financial obligations, up from 41 per cent in the previous quarter.
Additionally, 29 per cent reported they are already unable to cover their bills and debt payments, a noticeable rise from 25 per cent.
The survey, conducted by Ipsos between March 10 and 11 among 2,000 Canadian adults, suggests that many households are becoming increasingly cautious with spending. Nearly three-quarters of respondents said rising costs of essential goods are putting strain on their finances.
Grant Bazian, president of MNP Ltd., noted that Canadians are not only experiencing financial stress but also grappling with uncertainty that complicates budgeting and long-term planning.
The findings paint a picture of an economy where overall stability masks growing inequality, leaving a significant portion of the population struggling to keep pace with rising costs while wealth continues to concentrate at the top.
