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A cocktail party guide to quoting from the National Household Survey

You shall not talk about trends


 

(Sean Kilpatrick/CP)

There is lots of interesting information in the latest National Household Survey data tranche, on income and housing, which Statistics Canada published this morning. Did you know Canadians in the top one per cent of the income distribution are mostly educated older white men? Or that fully a quarter of Canadians spend 30 per cent or more of their total — not disposable — income on things like rent and mortgage? OK, fine, if you every read the news you probably suspected as much. Still, now you can quote the exact numbers at cocktail parties with the confidence that comes from StatsCan’s quality guarantee.

If you care about accuracy, though, you might wish to avoid drawing conclusions about what today’s NHS numbers tells us about income and housing trends. How much has income inequality widened — or shrunk? Are the poor struggling more or less? And what percentage of Canadians used to spend a third or more of their income on shelter five years ago? If you don’t have a Ph.D. in statistics or economics, StatsCan’s friendly advice is: Don’t try to answer those questions on your own. Simple math is enough if you want to use NHS data to, say, see the distribution of low-income people across provinces or ethnic and age groups. But extrapolating trends across the years now requires field-specific expertise. And even the pros must tread carefully, judging from StatsCan’s lengthy guide to the pitfalls of comparing the NHS, a voluntary survey, to the old, mandatory long-form census.

As my Econowatch colleague Kevin Milligan explained some time ago, the problem with terminating the long-form census is that you never know why people might decide not to respond to a voluntary questionnaire. If they do so at random, you’re fine: The new, voluntary data sample is comparable with the old, mandatory, randomized samples. But if, for example, poorer people are more likely not to answer, then you have a problem. At least a couple of Canadian studies based on both voluntary and mandatory income surveys have found precisely this issue with low-income respondents.

When I asked Alison Hale, director of income statistics at StatsCan, about comparability problems between NHS and the census, she pointed me to the table below (click here to see a larger image):

The key columns are the one on the right, which show the percentage change between 2005 and 2010 data for various income measures as captured by three different sources: The NHS/census, the Survey of Labour and Income Dynamics and the T1 Family File. As you can see, trends derived from the an NHS-census comparison generally do not line up with either of continuous series.

This holds true for housing trends as well, said Hale, with one exception: The home-ownership rate. There, the NHS/Census tells exactly the same story as other surveys of home-ownership: The share of Canadians who own their home has climbed to 69 per cent, up from 68.4 per cent.

Somehow, though, I don’t think that’s the kind of insight that’s going to wow a cocktail party audience.

 


 

A cocktail party guide to quoting from the National Household Survey

  1. Did the data check out regarding number of bathrooms (FIRST! HAHAHAHAHAHAHA!)

  2. What a tragedy. We don’t know more about income and housing trends.

    We also don’t know more about what types of bagels people like for breakfast. We know very little about how much fertilizer people use on their lawn. And we know next to anything about the duration of peoples’ showers and the position of their beds in their bedrooms.

    Absolute tragedy.

    Since we know very little about income division in ethnic groups, my life will never be the same. A disastrous loss for Canada and the world. And the universe.

    • You know you’re right – without the census I know that Pamela Wallin, at least in her New York home, does not even have one bedroom. And lawn fertilizer, I’d guess she isn’t using any.

    • Ignorant and happy. Of course, evidence-based decision-making has always been more a liberal thing.

    • Agreed. But you know, I just wish the Conservatives had killed the damned thing, rather than leave it as a going concern that no longer has any statistical legitimacy. It’s a hell of a ham-fisted way to go about things. Personally, I believe the main census gives us 99.9999% of what we need from a census, and we should be satisfied with that. Just get rid of the long form and be done with it.

  3. StatsCan statistics are often bogus. Don’t want to tell people their own inflation statistics don’t add up.

    But that being said, stats like 30% of the income going to mortgage is no surprise, I used to have a mortgage and it was at least 30% of gross wages. I don’t have a PhD in economics, but would bet I know more about economics than a in-debt over paid liberal-economics professor. He needs to work, I don’t. I can think and speak freely as I don’t get a governemtn check to be biased.

    Three biggest enemies of wealth growth are:

    1) Yourself, be it bad attitude or you whine instead of changing it. Invest in yourself, think for yourself and get the education and rational thinking. Get a life fiscal plan and stick to it. Choose only educations that will provide you with income or investment skills. Ignore liberal-economists, use only conservative economics.

    2) Government taxes, not much you can do about this unless you 1) hone your skills to get a long term offshore lower taxed higher income job like I did. Got an offer with twice the pay and lower taxes to leave Canada for 12 years, made bundle. It is why 1) is 1).

    3) Banks-debt. Once you pay off your home, that 30%+ goes to disposable income and very positive cash flow. If self disciplined, you invest most of it in early retirement. Using investment skills you invested in yourself with, let money not manage you, but learn for you to manage money. Been debt free since 1992. The interest saved alone is huge!

    Then you can retire at 55. And it sure beats having to work for debt when you are 65 because CPP is well below poverty. Real liberty, real freedom comes form decades of self discipline, good realistic fiscal and debt planning/elimination.

    Not too many real millionaires have debt. I say real as there are a lot of paper tigers out there.

  4. This is all BS anyway. As the article should be based not on gross income, but net income. Someone in 1914 made about an average of a $1/hr. Bought an average house for $600. Daily net pay to mortgage is about 1/600. You didn’t pay taxes in 1914 on a $1/day.

    Today, a $380,000 home means you need a net after taxes daily wage of $633 (1/600) after taxes, or about $1000/day gross before taxes.

    But not many make $1000/day gross.

    Reality is government and their paid liberal liar economists lie about inflation, taxes and quality of life. Inflation is really a tax, take RRSPs. Say your RRSP keeps pace with real inflation. It slowly converts the asset value to taxable income, thus loses after tax spendable value year over year. Part of why I call RRSPs tax traps. Bigger they get, the longer they grow the worse it gets. As a percentage, I pay more taxes on the way out of my RRSP today than I deferred going in, I made the RRSP mistake. But faired will in other areas.

    House prices went up relative to net income as a good part of the home costs go to tax inflated wages, duties, tariffs, hidden taxes — even the toilet you buy is taxed by Ottawa. GST/HST extra. But hey, you have lots of children in Ottawa to support and why domestic baby production is below sustainable levels, now below 1.5 kids per family.

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