CBC Manitoba

Who's to say I am poor?

You may make a lot of money and still struggle. You may make very little and find making ends meet a breeze. But, there are a few guidelines governments and organizations use to measure what it means to not have enough money.

It’s not what you make, it’s what you spend

Based on 1992 expenditure patterns, the Low Income Cut Off – Income After Tax (LICO-IAT), means you spend 63 per cent or more of your income on food, clothing and shelter.

To put this into perspective, the average Canadian family spends 43 per cent of their income on food, clothing and shelter.

The following 2008 graph illustrates what is considered low-income for various family sizes.

Size of family Rural areas Urban less then 30,000 Urban 30,000 - 99,999 Urban 100,000- 499,999 Urban 500,000 and over
1 person $12,019 $13,754 $15,344 $15,538 $18,373
2 person $14,628 $16,741 $18,676 $18,911 $22,361
3 person $18,215 $20,845 $23,255 $23,548 $27,844
4 person $22,724 $26,007 $29,013 $29,378 $34,738
5 person $25,876 $29,614 $33,037 $33,453 $39,556
6 person $28,698 $32,843 $36,640 $37,100 $43,869
7 or more persons $31,519 $36,072 $40,241 $40,747 $48,181

Half the average

Another relative measure of poverty is the Low Income Measure – Income After Tax (LIM-IAT).

Simply put, this measure is one half the average income of a Canadian family.

While the numbers change depending on family size, the measure fails to account for differences in location and size of community.

The following table shows the low-income numbers for 2007.

Size of family 0 children 1 child 2 children 3 children 4 children 5 children
1 adult $16,025 $22,435 $27,243 $32,050 $36,858 $41,665
2 adults $22,435 $27,243 $32,050 $36,858 $41,665 $46,473
3 adults $28,845 $33,653 $38,460 $43,268 $48,075 $52,883
4 adults $35,255 $40,063 $44,870 $49,678 $54,485 $59,293

The local approach

Tuna may not cost the same in Toronto as it does in Winnipeg, so how can a low-income measure work on a national level?

The Market Basket Measure (MBM) is a low-income guide that takes your geography to heart. The MBM derives its numbers from the costs of living in your specific community.

To be poor by MBM standards, your income is not enough to cover the costs of the necessary goods and services in your area.

The following table shows the MBM threshold for a reference family of 4 (2 adults and 2 children) in Manitoba for 2007.

Size of Community Total $ Food $ Clothing $ Shelter $ Transportation $ Multiplier
Rural 27,192 7,508 2,135 6,149 4,348 7,052
<30K 28,400 7,508 2,135 7,357 4,348 7,052
Brandon 26,156 7,508 2,135 7,839 1,622 7,052
Winnipeg 27,256 7,312 2,135 8,961 1,940 6,908