As the largest city in Canada, there are tons of wealth business people, however; numbers of poor people warns us to notice that the gap between these two types continues to grow.

According to research, Toronto has the largest income gap compared to other Canadian metropolitan areas. As the gap continues growing, there are more people concern about their future. So, this blog will take you to explore two main factors which drive the gap expanding insanely.

First, Globalization is an important cause of inequality. [1] Indeed, globalization brings a lot wealth for some people, but for most populace, it does not work out. Even worse, some people are hurt by it. Rich become richer; poor become poorer. The current economic structure is the rich economy. Economy system in current days is that a few people are rich and most people are relatively poor. For example, the traditional financial industry used to serve the economy, but now if we say that a large number of rich people are generated in the financial industry. In fact, the traditional economic industry has produced a large number of managers, and middle class people. In the current financial industry, if you go to Wall Street as an investor, you will realize there is a few workers, just a large number of computers. Therefore, the hiring of actual labor decreased. The decrease of the need makes the employ market more competitive. But, that is one of the new ways to make money. So, the financial industry can produce a very small number of rich people, but can not produce middle class people anymore, the poor is even more impossible. [2]

Second, housing affordability plays a huge role in creating inequality between rich and poor. [1] As we all know, housing prices in the city of Toronto are growing rapidly, but people’s wages are not increasing as fast as the housing price. Unless you are an entrepreneur or boss of a company, you could adapt to the changes. Nonetheless, many people are not that lucky, they can’t afford to live in Toronto easily, especially in Downtown Toronto. For example, the price of a one-bedroom apartments in Downtown costs between $550,000 – $650,000, and the monthly management fee for a one-bedroom apartment is between 200 – 600 Canadian dollars. What’s more, people have to pay for electricity and network. A common banker makes $2500 per month only, so the housing price is actually pretty pressure. For rent, a studio apartment charges around 1k7 – 2k2. In December 2010, the average selling price of house prices in Toronto was $378,500, but until the February of 2020, the average sold price becomes $911,742. [3] According to research, average annual salary in Ontario is $53,595. [4] But, many people don’t meet the average salary. So, it is reasonable why the gap between poor and rich is growing, it’s hard for many people to afford a decent home in the GTA. They use a large amount of their income to pay for their rents or mortgage. They have no more leisure money to invest.

In conclusion, the problem of the gap between rich and poor is very difficult to repair, because of these two reasons above.

References:

[1] https://sevenpillarsinstitute.org/causes-economic-inequality/

[2] https://zhidao.baidu.com/question/1963038019786823580.html

[3] https://toronto.listing.ca/real-estate-price-history.htm

[4] https://www.jobillico.com/blog/en/average-canadian-salary/