What counts as poverty in the NWT? Here’s one way it’s measured

In the NWT’s larger communities, a family of four would need at least $60,000 a year – but in some cases, $80,000 or more – to meet their basic needs.

That’s according to the NWT Bureau of Statistics’ market basket measure, used across Canada to measure low income based on how much a set “basket” of goods costs in each area.

The figurative basket includes food, clothing, transportation, shelter, and other expenses for a family with two adults and two children. The NWT has adjusted the clothing section of its basket to account for additional winter clothes, like parkas, that southerners don’t need.

If a family makes less than the basket costs, the bureau considers those people to be living in poverty.

Six communities are surveyed for the study: Fort Simpson, Fort Smith, Hay River, Inuvik, Norman Wells, and Yellowknife.

The 2018 figure – published in January this year – shows Yellowknife had the lowest cost of basic goods, with its market basket measure totalling just under $60,000.

In Norman Wells, however, a family of four needed an extra $22,000 for the same goods, which cost $82,336.

In the four years between 2015 and 2018, the cost of the basket in Yellowknife remained almost identical, increasing from $59,662 to $59,853.

However, there were significant increases elsewhere in the NWT over the same period.

In Fort Simpson, for example, the basket cost $5,000 more in 2018 ($69,336) than it did in 2015.

In 2018, the basket cost $60,911 in Fort Smith, $64,190 in Hay River, and $75,107 in Inuvik.

New income data

Bureau economic statistician Jeff Barichello said working out the cost is easy enough in Yellowknife, but gets harder as communities get smaller.

“We do a quarterly food price survey, so we go to the grocery stores to collect the prices of food,” he explained.

“Once you get to a smaller population it becomes more challenging to even collect the data … how do you measure something when maybe the information isn’t there? How do you measure the cost of housing if there is no market rent? Some of the really small communities may not even have a grocery store, so what is the cost of food?

“Then you have to look at their income and family size, and then compare their income to the adjusted thresholds,” Barichello said, explaining how the bureau calculates whether people can afford basic needs.

Understanding income in the NWT may be about to become easier, Barichello added, as the NWT Bureau of Statistics is working with Statistics Canada on new data.

“The income side comes from a very specific survey that [Statistics Canada] just started doing in the North last year,” he explained.

That information is expected to be published later in 2020. Combined with the market basket measure, the bureau hopes it will provide a clearer picture of how many families in the NWT are experiencing poverty.

Barichello said the federal report is also expected to estimate market basket costs in the NWT’s smaller communities, which currently aren’t covered. Federal statisticians will do so by adjusting market basket data from the territorial government to account for changes in geography and community size.