‘Historic levels of inequality’: Gap between rich and poor widening significantly in Quebec and Canada

The sharp rise in the cost of living after the pandemic has led to a marked increase in inequality in Quebec and Canada.

Data published Monday by the Quebec Inequality Observatory is clear: the richest have gotten richer and the poorest have gotten poorer after the surge in prices, particularly for housing and food.

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Housing and food

There has been much talk about the eight per cent inflation rate in 2022, but what is less widely reported is the cumulative price increases between 2020 and 2025. Over the last five years, from August 2020 to August 2025, the total price increase in Quebec has been 21.8 per cent.

The picture takes on a whole new perspective when we isolate the components of the consumer price index, which show that housing has increased by 31.4 per cent and food by 28.2 per cent. These two items accounted for half of the expenses of the poorest 20 per cent of the population in Quebec (28 per cent for housing, 22 per cent for food), but only 22 per cent (14 per cent for housing and eight per cent for food) of the expenses of the richest 20 per cent.

Since these figures are from Statistics Canada’s 2023 Household Expenditure Survey, we can assume the situation has worsened over the past two years for the poorest quintile.

These increases therefore do not have the same impact at both ends of the spectrum, points out the author of the report, Geoffroy Boucher, an economist at the observatory.

“When food and housing prices rise rapidly, it affects half of the expenses of people with lower incomes, while it affects only 22 per cent of the expenses of higher-income households. So they are more severely affected by price increases,” he said.

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A windfall for the wealthiest

Income, meanwhile, has taken opposite paths depending on the group in question. While the average shows that Quebecers’ disposable income increased by 19.3 per cent between 2020 and 2024 — slightly above the cumulative CPI of 18.3 per cent during those four years — this figure is skewed by the disproportionate increase in income among the wealthiest households.

The richest 20 per cent of the population (with incomes over $210,000) saw their annual disposable income jump by $71,807 in constant dollars, a 51.4 per cent increase, while households in the poorest quintile (with incomes under $30,000) saw their income fall by $568, a decline of nearly two per cent.

“What surprises us is the magnitude of this increase in inequality and the speed with which it is occurring. Because in 2020–2021, we saw a fairly significant reduction in inequality during the pandemic due to emergency government assistance — CERB and others — and this assistance had an impact on income distribution in society, particularly an increase in the income of lower-income individuals, which meant that the reduction in inequality was marked,” the economist said.

“But now, not only have we returned to the pre-pandemic situation, but we are on a trajectory toward reaching historic levels of inequality, even after taxes — that is, even after redistribution through the tax system.”

In the three other quintiles between the richest and the poorest, increases in disposable income range from $1,464 to $9,221 — nowhere near the windfall enjoyed by the richest.

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Constant deterioration

The most recent data from Statistics Canada does not allow us to establish current income disparities in Quebec, but another calculation at the Canadian level — namely, the difference in disposable income between the richest 40 per cent of households and the poorest 40 per cent — shows a gap of 48.4 per cent in the second quarter of 2025, a historic high in inequality according to this measure.

As for the situation in Quebec, the observatory’s report notes that “since income inequalities in Quebec, although less pronounced, generally evolve in the same direction as those observed across Canada, it is highly likely that a marked increase in income inequalities will also occur there between 2023 and 2025.”

The gap is even greater when looking at wealth — property, investments, pension funds and other assets — according to Canadian figures for the second quarter of 2025. While the richest 20 per cent receive 42.3 per cent of disposable income, they own nearly 65 per cent of the wealth.

In contrast, if we add up the bottom two quintiles — the poorest 40 per cent of the Canadian population — they receive 17.3 per cent of disposable income but hold only a tiny 3.3 per cent of the wealth accumulated in Canada.

–This report by La Presse Canadienne was translated by CityNews