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Understanding Your Context

Poverty in Canada

We live in one of the richest countries in the world. But about 20% of our citizens live in poverty.

Some groups have even higher poverty rates, including lone-parent families, Aboriginals, and new immigrants.

We haven't moved the needle on poverty in decades. It last dipped below 20% in 1989.

"From Good Causes to Root Causes" is about moving from alleviating poverty, which community foundations have done well for decades, toward reducing and preventing poverty – a much more complex task.

How Poverty is Measured

There are two main economic measures of poverty. One is absolute and one is relative. Each measure can be calculated on before-tax or after-tax income.

• The LICO (Low Income Cut-Off measure) considers a family poor when it spends more than 63.6% of its after-tax income on food, shelter and clothing. The LICO is an absolute measure. In 2005, using the LICO, 20.6% of Canada's families lived in poverty.
• The LIM (Low Income Measures) considers a family poor when its income is less than half of the median income for their size and type of family. This is a relative measure. In 2005, using the pre-tax LIM, 21.7% of Canadian families lived in poverty.

Our first definition of poverty is likely to be based on income. But there are other ways of measuring poverty used around the world, like social exclusion, capability, and others. We explore those in Ways to Respond to Poverty.