Canada's Prosperity Gap with US Widens by Over CA$23,000 per Person

The Fraser Institute released a study that highlights Canada's widening prosperity gap with the US. Since 1999, the income gap between the two countries has more than doubled, with Americans now earning CA$23,757 more per person than Canadians.

According to the study, in 1999 inflation-adjusted GDP per person stood at CA$48,076 in Canada and CA$58,842 in the US. By 2024, this figure had grown modestly in Canada to CA$59,529, while the US reached CA$83,286.

The study examines five economic indicators: living standards, incomes, employment, business investment, and productivity. In all these areas, Canada trails behind the US.

Labor productivity in the US expanded by 67.9% between 1999 and 2025, compared to just 26.7% in Canada. Business investment per worker fell from approximately 90 cents per Canadian dollar invested by the US in 2007 to just 54 cents by 2024.

The findings have been flagged as a structural threat to household income and long-term prosperity in Canada. Jake Fuss, director of fiscal studies at the Fraser Institute, said that 'the ability to transform raw materials and other inputs into demanded goods and services increased by more than a factor of 2.0 in the US compared to Canada, which explains much of our languishing living standards.'

The widening wealth and income divide among Canadian households has been identified as a compounding risk for borrowers entering or renewing mortgages.