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Incomes down in Alberta since 2014

Incomes down in Alberta since 2014

Posted on: 6/13/2019 | Author: ATB Financial's Economics + Research Team

​​Yesterday’s Owl examined the average net worth of Alberta households. Today, we take a look at inflation-adjusted annual income.

The negative impact of the 2015/16 recession is evident with the average after-tax income of Alberta households down by 4.1 per cent in 2017 versus 2014. (The most recent year for which income data are available is 2017). Family income contracted by 3.7 per cent over this period while the income of Albertans not in an economic family fell by 5.6 per cent.

The largest drop was in 2016 when household income contracted by 8.5 per cent. Income bounced back somewhat in 2017 with families posting 4.0 per cent growth while the average income of unattached individuals edged up by 0.5 per cent.

The reduction in average income would have been worse without the countervailing effects of government transfers such as Employment Insurance. The average amount of household income from government transfers in 2017 was 37.0 per cent higher in 2017 than in 2014. This was not enough to make up for the entire drop in market income but it brought the loss of income down from 8.3 per cent before transfers to 5.2 per cent after transfers.

More encouraging is the fact that average household income—and again, these figures are adjusted to remove the effects of inflation—was higher in Alberta in 2017 than 10 years earlier by 6.1 per cent. It may take another year or two before average income is higher than it was before it started falling after it peaked in 2015.

After tax income, graph​​

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