--- canonical_url: "https://csls.ca/research/what-explains-the-rising-profit-share-in-canada/" title: "What Explains the Rising Profit Share in Canada?" author: name: "CSLS" url: "https://csls.ca/author/cslc/" date_published: "2026-07-02T10:23:07+00:00" date_modified: "2026-07-02T10:23:07+00:00" post_type: "research" summary: "" post_tag: - "Canada" - "capital share" - "corporate profits" - "financialization" - "labour share" - "national accounts" - "profit share" - "sectoral trends" country_focus: - "Canada" province_region: - "National" research_theme: - "Economic Well-Being" - "Productivity and Economic Measurement" featured_image: "https://csls.ca/wp-content/uploads/2026/07/old-reports_hero_banner_bg.webp" status: "publish" --- # What Explains the Rising Profit Share in Canada? Canonical URL: https://csls.ca/research/what-explains-the-rising-profit-share-in-canada/ # What Explains the Rising Profit Share in Canada? [Download full PDF report](https://csls.ca/pdf/csls2020-07-1.pdf) Cite this report × Cite this report as: Sharpe, Andrew, Cristina Blanco Iglesias, and Myeongwan Kim. 2020. “What Explains the Rising Profit Share in Canada?” CSLS Research Report 2020-07. Ottawa: Centre for the Study of Living Standards. https://csls.ca/research/what-explains-the-rising-profit-share-in-canada/ ## Authors: - Andrew Sharpe Centre for the Study of Living Standards (CSLS) - Cristina Blanco Iglesias Centre for the Study of Living Standards (CSLS) - Myeongwan Kim Centre for the Study of Living Standards (CSLS) ## Report 2020-07 August 2020 62 pages ## Related research [Measuring the Appropriate Outcomes for Better Decision-Making: A Framework to Guide the Analysis of Health Policy Matthew Calver March 2016 | Report 2016-03 | 132 pages](https://csls.ca/research/measuring-the-appropriate-outcomes-for-better-decision-making-a-framework-to-guide-the-analysis-of-health-policy-2016-03/) [Living Standards Domain of the Canadian Index of Wellbeing Andrew Sharpe, Christopher Ross November 2011 | Report 2011-17 | 124 pages](https://csls.ca/research/living-standards-domain-of-the-canadian-index-of-wellbeing-2011-17/) [Productivity: Key to Economic Success Centre for the Study of Living Standards (CSLS) March 1998 | Report 1998-01 | 99 pages](https://csls.ca/research/productivity-key-to-economic-success/) [Apprenticeship in Canada: A Training System Under Siege? 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While an extensive body of literature has studied the fall in the share of labour income in the gross domestic product (GDP), less attention has been paid to the development of the components of its counterpart, the capital share. In the system of National Accounts, the capital share of income can be broken down into net operating surplus and net mixed income (which includes corporate profits before taxes, net interest paid, net other payments and inventory valuation adjustment, and net mixed income) and capital consumption allowances (CCA). This report contributes to the discussion on the rising capital share by studying the evolution of the Canadian corporate profit share in the past three decades using both financial and national accounts data. We analyze trends at the aggregate and sectoral level and compare the aggregate trends to those in the United States during the same period. We also provide an overview of the structural factors affecting the corporate profit share in Canada. According to national accounts data, the corporate profit share before tax in Canada rose 3.8 percentage points between the 1961-1999 and 2000-2017 periods, an increment that significantly enhanced the surge in the capital share of income. Similarly, the financial corporate profit share of income increased by 7.2 percentage points between 1997 and 2017. This development was widespread, with the profit share increasing in all sectors except mining, quarrying and oil, and gas extraction. It was also concentrated. We find that the financial sector, which accounts for less than one tenth of GDP, was responsible for 33 per cent of the increase in the corporate profit share. Complete time series of the profits data used in this report can be found in a profits database developed as part of this research project. La répartition des gains de la croissance économique entre les travailleurs et les sociétés a évolué au fil du temps. Bien qu’une vaste littérature ait étudié le recul de la part du revenu du travail dans le produit intérieur brut (PIB), l’évolution des composantes de sa contrepartie, la part du capital, a reçu moins d’attention. Dans le système des comptes nationaux, la part du capital dans le revenu peut être décomposée en excédent d’exploitation net et revenu mixte net (qui comprend les profits des sociétés avant impôt, les intérêts nets versés, les autres paiements nets et l’ajustement de la valeur des stocks, ainsi que le revenu mixte net) et les provisions pour consommation de capital (PCC). Ce rapport contribue à la discussion sur la hausse de la part du capital en étudiant l’évolution de la part des profits des sociétés canadiennes au cours des trois dernières décennies, à l’aide de données financières et de données des comptes nationaux. Nous analysons les tendances à l’échelle agrégée et sectorielle, et comparons les tendances agrégées à celles observées aux États-Unis durant la même période. Nous présentons également un aperçu des facteurs structurels qui influent sur la part des profits des sociétés au Canada. Selon les données des comptes nationaux, la part des profits des sociétés avant impôt au Canada a augmenté de 3,8 points de pourcentage entre les périodes 1961-1999 et 2000-2017, un accroissement qui a contribué de façon importante à la hausse de la part du capital dans le revenu. De même, la part des profits des sociétés financières dans le revenu a augmenté de 7,2 points de pourcentage entre 1997 et 2017. Cette évolution était généralisée, la part des profits ayant augmenté dans tous les secteurs sauf l’extraction minière, l’exploitation en carrière et l’extraction de pétrole et de gaz. Elle était également concentrée : nous constatons que le secteur financier, qui représente moins du dixième du PIB, est responsable de 33 % de la hausse de la part des profits des sociétés. [Download full PDF report](https://csls.ca/pdf/csls2020-07-1.pdf)