Reducing Lone-Parent Poverty: A Canadian Success Story

From 1996 to 2007, the poverty rate among the two million Canadians living in lone-parent families fell by more than half – from nearly 50 percent to just over 20 percent – as measured by the low-income cutoff (LICO) rate. The proximate cause is a dramatic increase in employment and hence average market income among these families. There are several underlying factors at work. While lone-parent poverty has fallen dramatically, Canada’s overall poverty reduction since mid-1990s has been similar to other OECD countries. And, as measured by the low-income measure (LIM – the percentage living below half of the median income), Canada’s poverty rate in mid-2000s was above that of the typical OECD country. The study includes a methodological appendix on defining poverty thresholds. In addition to the LICO, the Canadian government maintains two other measures: the LIM and the market basket measure (MBM). The study recommends replacing the LICO by the LIM as the standard poverty measure.