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$28,600 a Year: What the Average Older Canadian Woman Lives On

Many choose flexibility or family over pay, only to arrive at retirement with a meagre pension

When it comes to the gender pension gap in Canada, there’s good news, bad news—and caveats.

Over the past fifty years, retirement income has increased for many Canadians. Old Age Security, for example, was indexed to inflation in the early 1970s. So was the Guaranteed Income Supplement. And in 1976, 34.3 percent of women aged sixty-five and older were defined as low income (after paying taxes) compared to 17.5 percent in 2022. This is a striking improvement, but it still accounted for some 700,000 women as of that year, a number which will be higher today.

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Seemingly endless streams of data on poverty, low income, or median income are collected and analyzed by Statistics Canada. A 2024 analysis goes deep into comparative detail on the financial status of women, but this line sums it up: “Overall, older women had lower income, higher low-income and poverty rates, and relied more on government transfers than older men.”

In 2022, the median income (after tax) for male and female Canadians aged sixty-five and older was $32,000. The average older man received $38,700 per year. As for the average older woman? She lived on $28,600. It was worse for women who are racialized and those who immigrated later in life. Imagine living on that income and paying $2,400 a month in rent (or even $2,000) and eating.

Elizabeth Shilton, a legal scholar, author, and pension expert, highlighted this disconnect in her damning 2024 report on Canada’s gender pension gap for the Ontario Pay Equity Office (PEO). “Canada has one of the best retirement income systems in the world,” Shilton wrote. “But all Canadians do not benefit equally from the system. Masked by the good-news data is a substantial and persistent gender pension gap.”

The contrast in retirement income between men and women, Shilton’s report said, has not changed since 1976. This prolonged inequity is perplexing, since women are increasingly educated and employed; the reasons for the gender pension gap, today and in the future, remain locked in the past.

Retirement pensions are, to this day, built on a philosophy defined in the late 1800s. By men, for men. But mostly for companies that needed committed workers.

Shilton’s book Empty Promises: Why Workplace Pension Law Doesn’t Deliver Pensions offers a fascinating dissemination on the reasons Canada’s private workplace pensions are failing so many:

Canada’s private workplace pension system was not designed to produce adequate, predictable, and secure pensions for workers. It was designed to meet the business needs of employers. For much of the 20th century, pension plans functioned as valuable human-resource management tools for employers whose business model demanded a stable workforce of loyal well-trained employees. They assisted enterprises to attract career-minded employees, to retain them throughout their productive working lives, to influence their workplace behaviour, and to ease them out the door when they became too old to be productive.

Canada’s private workplace pension system was not designed to produce adequate, predictable, and secure pensions for workers. It was designed to meet the business needs of employers. For much of the 20th century, pension plans functioned as valuable human-resource management tools for employers whose business model demanded a stable workforce of loyal well-trained employees. They assisted enterprises to attract career-minded employees, to retain them throughout their productive working lives, to influence their workplace behaviour, and to ease them out the door when they became too old to be productive.

Canada’s first company pension launched in 1874, offered to management at the Grand Trunk Railway. Employee pensions arrived later. During this period of rapid industrial expansion, businesses competed hard for workers, and pensions helped buy loyalty. As Shilton noted in an interview, the railroads, banks, and insurance companies that fostered the development of private pensions held all the power.

Remarkably, there were no regulations protecting a worker’s pension from an employer’s whims. “You could lose every penny of your pension if you were fired the day before you hit retirement age,” she said. “A lot of the pensions were fundamentally discretionary. If you changed your job midstream, you would lose your pension.”

Demand for reform grew. The first province to act,........

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