Why does your grocery bill cost 31% more than in 2015 — and it's not just inflation?
Your groceries cost more, so does filling up your tank, and yet your salary may have gone up. So why does it feel like you have less money than before? It's not just a feeling: the average Canadian has lost about 23% of their purchasing power between 2015 and 2025. With numbers to back it up, we'll show you exactly how we arrived at this figure.
In this article, you'll understand the three forces eating away at your money, see the year-by-year breakdown, and find out how much more you would have needed to earn just to maintain your standard of living.
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Let's start with the basics, then dig into the details — with tables, formulas, and concrete examples to back it all up.
What is purchasing power, exactly?
Purchasing power is the amount of goods and services you can afford with your money. If your salary stays the same but prices go up, your purchasing power goes down. You have the same amount in your pocket, but it buys you fewer things.
How much does the same grocery run cost in 2026 vs. 2015?
Concrete example: In 2015, a typical grocery run for a family of four might have cost around $175. If that same grocery run now costs $230, but your salary hasn't budged, you've lost purchasing power. Even if your salary went up by 20%, you've still lost ground because prices have risen by 31%.
What are the three ingredients destroying your purchasing power?
To understand the erosion of purchasing power, you only need to track three economic indicators. No economics degree required — just logic.
Ingredient #1: What does real GDP growth tell us?
GDP (Gross Domestic Product) is the size of the country's "economic pie" — the total value of everything produced in Canada in a year. When we say real GDP, it means we've stripped out the effect of inflation to see the true growth.
Between 2015 and 2025, Canada's real GDP grew by 19.5% (source: World Bank, Canada Real GDP). In other words, the Canadian economic pie grew by a fifth. On paper, that's excellent news.
Ingredient #2: Why does population growth dilute your share of the pie?
GDP is a collective pie. If the pie grows by 19%, but there are 18% more people around the table, each person gets a slice that's barely bigger than before.
The pizza analogy: Imagine 8 friends ordering 2 large pizzas. Each person gets 2 slices. Now, 3 more friends show up — there are now 11 people. But nobody ordered extra pizza. The result? Instead of 2 slices each, everyone ends up with about 1.5 slices. Nobody stole any pizza. There are just more people sharing the same amount.
That's exactly what happened in Canada. The population went from about 35.7 million in 2015 to 41.7 million in 2025 — an increase of 17.9% (source: Statistics Canada, Table 17-10-0009-01). That's one of the fastest population growth rates among G7 countries.
Ingredient #3: How does inflation eat away at what's left?
Inflation is the general rise in prices. Even if your share of the pie stayed the same as before, inflation means that share buys less and less. It's as if the pizza slices were shrinking year after year.
Cumulative inflation in Canada between 2015 and 2025: 31.2% (source: Statistics Canada, CPI Table 18-10-0005-01). What cost $100 in 2015 now costs about $131.
How do you calculate the loss of purchasing power, step by step?
Now that we have our three ingredients, here's how we calculate the change in real purchasing power per capita for a given year. It's a simple two-step calculation.
Step 1: How do you get real GDP per capita?
We start by dividing the pie (GDP) by the number of people (population). In percentage terms:
Real GDP per capita ≈ Real GDP growth − Population growth
Example using 2023: Real GDP grew by +1.5% (source: World Bank), but the population grew by +2.9% (source: Statistics Canada). Real GDP per capita = 1.5% − 2.9% = −1.4%
In other words, even though the economy grew, each Canadian's share actually shrank because the population grew even faster.
Step 2: What's left after inflation?
Next, we remove the effect of inflation:
Real purchasing power per capita ≈ Real GDP per capita − Inflation
Example using 2023: Real GDP per capita = −1.4%, and inflation was +3.9%. Purchasing power = −1.4% − 3.9% = −5.3%
In a single year, the average Canadian lost 5.3% of their purchasing power. It's as if you got a 5% pay cut without being told.
Technical note: the exact formula uses multiplication [(1+GDP)/(1+Pop)/(1+Infl) − 1], but the simple subtraction gives a very good approximation. The difference is only a few tenths of a percentage point.
What does the year-by-year breakdown look like from 2015 to 2025?
Here's the full picture. For each year, we show the three ingredients and the final result.
| Year | Real GDP | Population | Inflation | Real GDP/capita | Real purchasing power/capita |
|---|---|---|---|---|---|
| 2015 | +0.7% | +1.0% | +1.1% | −0.3% | −1.4% |
| 2016 | +1.0% | +1.1% | +1.4% | −0.1% | −1.5% |
| 2017 | +3.0% | +1.3% | +1.6% | +1.7% | +0.1% |
| 2018 | +2.8% | +1.4% | +2.3% | +1.4% | −0.9% |
| 2019 | +1.9% | +1.5% | +1.9% | +0.4% | −1.5% |
| 2020 | −5.0% | +1.1% | +0.7% | −6.1% | −6.8% |
| 2021 | +5.3% | +0.6% | +3.4% | +4.7% | +1.3% |
| 2022 | +3.8% | +1.8% | +6.8% | +2.0% | −4.8% |
| 2023 | +1.5% | +2.9% | +3.9% | −1.4% | −5.3% |
| 2024 | +1.6% | +3.0% | +2.4% | −1.4% | −3.8% |
| 2025 | +1.7% | +0.9% | +2.1% | +0.8% | −1.3% |
| Cumulative | +19.5% | +17.9% | +31.2% | +1.4% | −23.3% |
The takeaway is striking: out of 11 years, 9 show a loss in purchasing power. The only positive years (2017 and 2021) didn't even make up for the losses in the years before and after.
How do you read this table in practice?
Let's take 2022, the most painful year for inflation:
- Real GDP grew by +3.8% → the economy did well
- The population grew by +1.8% → the pie has to be split among more people
- So GDP per capita = +3.8% − 1.8% = +2.0% → each Canadian "produced" 2% more
- But inflation was +6.8% → prices rose by almost 7%!
- Result: +2.0% − 6.8% = −4.8% → despite a growing economy, each Canadian lost nearly 5% of their purchasing power
Which force does the most damage: demographics or inflation?
It's a natural question: between demographic dilution and inflation, which is the bigger culprit? To find out, we can run a hypothetical exercise: what would have happened if the population hadn't grown?
| Scenario | Cumulative loss |
|---|---|
| Actual (inflation + dilution) | −23.3% |
| Stable population (inflation only) | −9.5% |
| Share from demographic dilution | ~13.8 points |
Over the 2015-2025 period, demographic dilution contributed even more than inflation to the erosion of your purchasing power (~59% vs. ~41%). This is counterintuitive. We hear a lot about inflation in the media, but rarely about the effect of rapid population growth on individual living standards.
The nominal illusion: why your raise didn't actually make you richer
In current dollars (without adjusting for inflation), GDP per capita increased by about 30-35% since 2015. Nominal wages also went up. On your pay stub, the numbers are climbing. Everything looks fine.
But cumulative inflation of 31.2% swallowed up all of those gains. It's like running on a treadmill: you're putting in a lot of effort, but you're staying in the same place. In fact, you've actually fallen behind.
Just to get back to the same standard of living as in 2015, a Canadian would have needed an income increase of about 30% since then. How many Canadians actually got that?
How much has Marie from Laval really lost over 10 years?
Take Marie, 42, from Laval. She was earning $55,000 in 2015.
- To maintain her purchasing power, she would need to be earning about $71,500 in 2025 ($55,000 x 1.30)
- If she received annual raises of 2% per year, she's now earning about $67,000
- Her real shortfall: about $4,500 per year
- Over 11 years, that's the equivalent of ~$30,000 in lost purchasing power
And Marie may not even realize it, because her nominal salary went up by 22%. The number goes up, but purchasing power goes down. That's the nominal illusion.
Are your savings also melting away in a low-return account?
This is where the story gets really concerning for savers.
How much have you really lost by keeping your money in the bank?
If you had $10,000 in a savings account in 2015 earning an average interest rate of 1.5%, here's what happened:
- Your balance in 2025 (with compound interest): about $11,760
- But with cumulative inflation of 31.2%, you would need $13,120 to have the same purchasing power as in 2015
- Real loss: about $1,360, or nearly 14% of your initial capital
In other words, your money "melted" by 14% while sitting safely in the bank. You didn't spend a thing, and you still lost out.
What return do you need just to avoid getting poorer?
To avoid getting poorer while saving, your investments need to generate a return that exceeds inflation. In Canada, between 2015 and 2025, that meant beating average inflation of about 2.5% per year. A savings account at 1.5% clearly doesn't cut it.
That's why a diversified investment strategy — one that includes stocks, bonds, and other asset classes — is essential. Not to get rich, but simply to avoid getting poorer.
How much does inaction cost over 11 years?
For a family with $50,000 in savings in 2015, the difference between "doing nothing" and "investing wisely" over 11 years could look like this:
| Strategy | Value in 2025 | Real purchasing power |
|---|---|---|
| Savings account at 1.5% | $58,800 | ~$44,800 (in 2015 dollars) |
| Balanced portfolio at 6% | $95,000 | ~$72,400 (in 2015 dollars) |
| Difference | $36,200 | $27,600 |
The family that did nothing lost over $5,000 in real purchasing power. The one that invested gained over $22,000. The gap between the two scenarios: nearly $36,000.
See what $10,000 invested in 2015 would be worth today in different portfolios.
Note: these figures are illustrative and do not constitute a guarantee of returns. The 6% return represents a typical balanced portfolio over the period, but actual results vary.
In summary: 5 key findings about purchasing power in Canada
- −23% in real purchasing power per capita between 2015 and 2025
- Two forces contribute to this: demographic dilution (~59%) and inflation (~41%)
- Nominal wages went up, but not enough to offset these two forces combined
- You would need an income increase of ~30% since 2015 to get back to the same standard of living
- Uninvested savings have lost 14% of their real value — a diversified investment strategy is needed just to preserve your purchasing power
What is your next concrete step?
You now know that time is working against your money if you do nothing. There's only one thing missing: action.
Option 1: Take the 7 Pillars Scan (free, 5 min)
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FAQ — Frequently Asked Questions About Purchasing Power in Quebec
Updated March 2026 — Cumulative CPI 2015-2025: +31.2%. Inflation 2025: ~2.1%.
1. How is the loss of purchasing power calculated in Canada? Three indicators are combined: real GDP growth (+19.5% over 2015-2025), population growth (+17.9%), and cumulative inflation (+31.2%). The exact formula is [(1+GDP)/(1+Pop)x(1+Infl)] − 1. The simplified subtraction (GDP − Population − Inflation) gives a good approximation. Sources: Statistics Canada, World Bank.
2. Why has purchasing power dropped by 23% if inflation is only 31%? Because inflation is only one of two forces at play. Demographic dilution — the fact that GDP is shared among more people — accounts for about 59% of the loss. Inflation accounts for the remaining 41%. Together, they total −23.3%.
3. How much more would you need to earn to offset the loss of purchasing power since 2015? About 30% more. A salary of $55,000 in 2015 would need to be at least $71,500 in 2025 to maintain the same standard of living. Typical annual raises of 2-3% are not enough to offset cumulative inflation of 31.2%.
4. Do savings in a bank account really lose value? Yes. A savings account at 1.5% interest turned $10,000 into about $11,760 over 11 years, but you would need $13,120 to maintain the same purchasing power. Real loss: about 14%. To avoid getting poorer, returns must exceed inflation.
5. Is immigration the main cause of the loss of purchasing power? Population growth (including immigration) contributes to about 59% of the loss through the "dilution" of GDP per capita. However, immigration also contributes to economic growth. The problem isn't immigration itself, but the fact that GDP growth hasn't kept pace with population growth.
6. What was the worst year for purchasing power in Canada? 2020 was the worst year with a drop of −6.8%, caused by the GDP contraction of −5.0% (COVID-19 pandemic). The second worst was 2023 at −5.3%, due to the combination of weak GDP growth (+1.5%) and strong population growth (+2.9%).
7. Is Quebec more affected than the rest of Canada? The data in this article covers all of Canada. In Quebec, inflation followed a similar trend, but average wages are slightly lower than the Canadian average, which can amplify the effect. Housing costs also vary by region.
8. What type of investment beats inflation over the long term? Historically, a balanced portfolio (stocks + bonds) generating about 6% per year comfortably beats inflation. Over 11 years, $50,000 invested at 6% becomes $95,000 vs. $58,800 at 1.5% in a savings account — a gap of $36,200. Consult an advisor for a strategy tailored to your profile.
9. Will inflation continue to erode purchasing power in 2026? Canada's CPI is estimated at about 2.3% for 2026 (Statistics Canada), close to the Bank of Canada's target. If population growth also slows (tighter immigration policy), the erosion of purchasing power could slow down — but it won't reverse without strong real GDP growth per capita.
10. What can I actually do to protect my purchasing power? Three key actions: (1) invest in assets that beat inflation (RRSP, TFSA, diversified portfolio), (2) negotiate salary increases above inflation, (3) reduce high-interest debt that amplifies the erosion. Our 7 Pillars Scan identifies your priorities in 5 minutes.
11. How much purchasing power have I lost since 2015 in Quebec? About 23% according to Statistics Canada's CPI (2015-2025). Concretely, $100 in 2015 is now worth only about $77 in real purchasing power in 2026, once you combine cumulative inflation (+31.2%) and demographic dilution (+17.9%). Take the 7 Pillars Scan to see the impact on your personal situation.
This article is for informational and educational purposes only. It does not constitute personalized financial, tax, or legal advice. The figures presented are illustrative examples based on historical data and reasonable return assumptions. Past performance does not guarantee future results. Consult a licensed financial advisor for recommendations tailored to your personal situation.
Sources and methodology
Data verified as of March 2026. This article is updated annually.
Data sources: - Statistics Canada — Tables 17-10-0009-01 (population) and 18-10-0005-01 (CPI) - World Bank — Indicator NY.GDP.MKTP.KD.ZG (Canada Real GDP) - Trading Economics — Supplementary economic data 2024-2025
Calculations: Purchasing power changes are calculated by combining real GDP growth rates, population growth, and CPI inflation. The exact formula uses compound growth: [(1+GDP)/(1+Pop)x(1+Infl)] − 1. Actual results vary depending on the methodology and sources used.
* The names and situations presented in this article are entirely fictional and used for illustrative purposes only. Any resemblance to real persons is purely coincidental.
Past performance is not indicative of future returns. Projections and numerical examples are presented for illustrative purposes only and do not constitute a guarantee of results.
The calculations and data compilations were produced by Lawrence Shaw and verified with the assistance of artificial intelligence tools using official sources.
This article is published for informational and educational purposes only. It does not constitute personalized financial advice. The information presented is general in nature and does not take into account your personal situation. Consult your financial security advisor for recommendations tailored to your situation.
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