A recent report from Food Banks Canada has unveiled a significant hidden poverty issue, showing that a quarter of Canadians are living at a poverty level, far surpassing the official poverty rate of 10%.
A Deeper Look into Hidden Poverty
Experts estimate that 25% of Canadians experience a poverty-level standard of living, compared to the official 10% poverty rate. This revelation comes from the Material Deprivation Index (MDI), a poverty metric widely used in Europe but new to Canadian data. The report, authored by Michael Mendelson, a Maytree Fellow, and Geranda Notten, a Professor of Comparative Public Policy at the University of Ottawa, indicates that nearly 6 million more Canadians are struggling than reported by Statistics Canada.
Staggering Findings
According to the MDI, 30% of Canadians aged 18-30, 44.5% of single-parent households, and 42% of renters cannot afford two or more essential household items. Other demographics showing high rates of material deprivation include:
- 55.5% of unemployed individuals seeking work
- 55.4% of those relying on government transfers as their primary income source
- 34.4% of individuals identifying as Black
- 37.4% of Indigenous people
- 37% of individuals with disabilities
Insights from the Experts
Professor Notten from the University of Ottawa elaborates on the report’s findings:
Q: Why was the MDI chosen for this report?
Geranda Notten “The MDI measures poverty by examining specific conditions Canadians deem necessary for an acceptable living standard. Our index includes 11 items, such as maintaining a comfortable home temperature year-round. In 2023, we found that 1 in 4 Canadian adults could not afford two or more of these items.”
Q: Why isn’t the MDI commonly used in Canada, and should it be?
Geranda Notten: “Poverty measurement in Canada has traditionally focused on family income. While income is crucial, it fails to account for specific family needs and circumstances. The MDI, on the other hand, assesses material outcomes, making it more accurate as it considers the actual living conditions and specific challenges families face.”
Q: What are the key takeaways from this report?
Geranda Notten “The extent of poverty in Canada is greater than the official indicators suggest. These measures often underestimate the financial needs of families. For example, a recent move could drastically increase a family’s housing costs, or ongoing medical expenses could strain their finances, highlighting the inadequacy of current income-based poverty measurements.”
The report underscores the need for a more nuanced understanding of poverty in Canada, advocating for broader adoption of the MDI to better capture the true extent of economic hardship and to inform more effective policy responses. Hidden poverty remains a critical issue, affecting millions of Canadians and calling for urgent attention and action.
Another recent report demonstrated that nearly half of Canadians (44%) feel financially worse off than the previous year. One in four Canadians are experiencing food insecurity, and all provinces except one are failing in the affordable housing section of the report. These findings led Food Banks Canada to downgrade the federal government’s grade from D in 2023 to D- in 2024.