The Northwest Territories faces deep poverty challenges, including high rates of food insecurity and poverty, as well as steep costs for housing and other essentials. These factors are made worse by limited finances and the enduring impact of colonialism. Compared to other territories the NWT government has largely neglected to address these issues in 2024. While there were efforts in 2023, such as raising the minimum wage and modernizing social assistance, progress on poverty reduction initiatives has stalled this in 2024.

Poverty Overview

According to the Northern-specific market basket measure (MBM) used in the 2021 census, approximately 1 in 10 residents (11.1 per cent) in the NWT experience poverty. While poverty in the NWT is significantly lower than in neighbouring Nunavut, it is still high compared to both the national average and the Yukon’s rate. Population growth has recently stagnated, as it has in all the territories, but the NWT has significant resource wealth and development potential that present major future opportunities for prosperity and equitable growth if properly tapped.

Overall, residents of the NWT identify improving infrastructure, reducing taxes for people with low incomes and for small businesses, promoting decent work, and reducing food costs as top priorities in the alleviation of poverty.

Children and youth, as a combined group, represented over one-third of the NWT’s population in the 2016 and 2021 censuses. Children (under 18) represented 25 per cent of the population and youth (aged 18–24) represented 9 per cent. This breakdown of age groups is found in many Indigenous communities across Northern Canada. Young people are a significant demographic, particularly in Nunavut, where they make up half the population. Child poverty in the NWT is significantly higher than in the Yukon (14.5 per cent compared to 8.9 per cent) but much lower than in Nunavut (43.5 per cent). With children making up such a large proportion of the population, the high child poverty rate is all the more concerning.

Conversely, people in their core working years have the lowest poverty rate among all age groups in the NWT, at 9.1 per cent among those aged 25–54. In particular, those who are coupled - and can therefore spread their costs over two incomes, experience poverty at a much lower rate (5.1 per cent). 

Comparison with Other Territories

The poverty rates among families and individuals differ greatly among the three territories. For example, in the Yukon, the overall poverty rates are similar for both people who live alone and people who live as a couple. One exception to this is the rate of poverty among lone parents who are women. The poverty rate for this group in the Yukon is slightly below the rate for Canada as a whole. In the NWT, however, couples, single mothers, and people who live alone had slightly higher poverty rates than the national rates. In Nunavut, poverty rates were higher in nearly every demographic group compared to the Canadian average, with significantly higher rates among single parents and people who live alone. A majority of single parents in Nunavut live in poverty, which is nearly four times higher than the Yukon (14 per cent) and far outpaces rates seen anywhere in Canada.

Table 1. Poverty rate for select groups by Canada and the territories (per cent), 2021 census[1]

Poverty and Inequality in Northwest Territories

Unfortunately, the small sample sizes mean that Statistics Canada does not report poverty rates that allow for disaggregated analysis in the territories by Indigenous or racial identity, or by immigration status. However, knowing that people who identify with these demographics generally experience higher rates of poverty across Canada—as seen, for example, in the data for the provinces—we can assume that the NWT is similar and that it must provide additional support for groups that have a disproportionate experience of poverty.

About half of the NWT’s population identifies as Indigenous. This is the second-highest proportion in Canada, trailing only Nunavut, where the majority of residents are Inuit. Among Indigenous Peoples in the NWT, two-thirds are First Nations, over 20 per cent are Inuit, and the rest are Métis. While poverty rates among Indigenous people in the NWT are difficult to determine, our national survey revealed that providing regular and reliable supports to Indigenous communities is an important poverty-reduction strategy to 89 per cent of people in the territory. This rate is nearly 20 percentage points higher than the national average and indicates an acute need among the Indigenous population.

In the NWT, nearly 5,000 individuals (12.2 per cent of the population) self-identified as belonging to the racialized population. In addition, 70 per cent of racialized individuals were first-generation immigrants (born outside of Canada). Overall, the NWT has one of the highest rates of people who say that tackling racialized and ethnic inequality is important to reducing poverty—85 per cent, compared to 71 per cent nationally.

Labour and Education

As of March 2024, the unemployment rate in the NWT is 5 per cent, which is similar to a year ago (5.2 per cent). Furthermore, as of January 2024, the percentage of people who are participating in the workforce is significantly higher in the NWT (72 per cent) than the national rate (65.4 per cent) and much higher than in neighbouring Nunavut (60.2 per cent).

Youth aged 15–29 who are not in employment, education, or training (NEET) are at particular risk of poverty. In 2022, 20 per cent of youth in the NWT were in this situation, which is nearly double the rate for youth in Canada as a whole. In addition, one-quarter of NWT adults (aged 25–64) did not have a high school diploma or equivalent. This is double the rate for this group in Canada as a whole (11.6 per cent), and it is even higher among NWT men (29 per cent).

A particular challenge for the NWT’s labour market is poor Internet access, which hinders access to remote work. A significant majority of the population (85 per cent) agree that Internet access is important to reducing poverty, compared to 72 per cent nationally. Without access to high-speed Internet, people living in the NWT may struggle to access economic opportunities elsewhere in the country. This type of access is vital in small communities where employment opportunities can be limited.

For people who are unable to find work, social assistance rates are not enough to help them make ends meet. Almost half of the population (49 per cent) think it is really important to see an increase in last-resort benefits. This figure is nearly 15 percentage points higher than the national average.

The Cost of Living and Affordable Housing

As with other variables, data is not readily or consistently available at the territorial level to allow for a robust assessment of certain essentials such as food and shelter. The following is a short summary of what we do know.

Between December 2022 and December 2023, the overall price of goods and services in Yellowknife increased by 3 per cent, which was slightly slower than in Canada as a whole (3.4 per cent), according to the Consumer Price Index.

Yellowknife, at 7.7 per cent, had the highest increase in food costs in Canada. In addition, the cost of food in Northern communities remains significantly higher than in the rest of Canada because of the overall higher costs of living in remote and isolated areas, coupled with the high costs of shipping and storing perishable and nutritious food. Overall food insecurity in the NWT remains high. One particular aspect of the experience of food insecurity in the territories is the need to access traditional foods. In the NWT, 84 per cent of people say that increasing access to traditional foods is important to them.

Furthermore, the cost of shelter increased by 5 per cent in Yellowknife, which is slightly lower than the increase in shelter costs in Canada as a whole (6 per cent). As with Nunavut, the primary housing problem in the NWT is twofold: a lack of suitable housing and housing that is too expensive. Approximately 13 per cent of households in the NWT were considered in core housing need in 2021, and the proportion of those who find themselves in this situation because the housing structure is inadequate as opposed to unaffordable is deeply concerning. It is therefore unsurprising that 94 per cent of people in the NWT say that improving infrastructure in their communities is important to them. Despite the known issue of inadequate housing in the territory, 2 in 3 residents (the highest rate in the country) report spending 30 per cent or more of their income on housing.

Decent Work that Pays

The NWT’s minimum wage was recently increased to $16.05, the first increase in more than two years. While this helps to offset some of the recent inflation pressures, there is a need to provide greater support, particularly as affordability concerns remain high.

With the resurgence of global commodity prices and the increased interest in Canadian mining, along with new investments in northern defence infrastructure, the NWT is well positioned to be a key partner in these sectors. It is important that all residents benefit equitably from these projects. We recommend the territory increase its focus on securing jobs, long-term training, apprenticeships, and community benefit investments that will all help to provide greater employment and economic opportunities for residents with low incomes. 

Cost of Living

Affordable Housing

Given the broad introduction of the Canada–NWT Housing Benefit rent supplement program, which to date has no active waiting list, there is an opportunity for the territory to take further steps to protect renters.

Using Yukon’s successful municipal rental construction fund as a model, the NWT should investigate the creation of a municipal/territorial grant matching model to assist developers of purpose-built rental construction. This can be developed with a small pool of capital funding to begin with, and scaled over time as dedicated funding is established.

Community Infrastructure

The territorial government should collaborate with the Government of Canada to develop a long-term capital plan that aims to reduce the gaps between the NWT and the provinces. As part of the NWT’s focus on housing, both the territory and the federal government should take inspiration from Nunavut’s recent plan to build up to 3,000 units of housing by the end of 2030.

With many major employers, including several large diamond mines, nearing the end of their production cycle, the territory and the federal government must work together to develop a long-term, comprehensive plan for economic growth that will ensure good jobs for low- and mid-skilled workers. At the core of this plan must be a commitment to develop a social and community infrastructure that will enable effective long-term development.