A living wage is the hourly wage a worker needs to earn to cover their basic expenses and participate in their community. The Ontario Living Wage Network’s 2025 calculations show an average living wage increase across our 10 regions of 5.3%, reflecting a higher increase compared to the 2024 rate announcement last year. This is reflective of increased accuracy of rental costs being included in the calculation.
As expected, the Greater Toronto Area continues to have the highest living wage rate at $27.20, up from $26.00, although this increase is not as steep as other regions. The Southwest region that includes Windsor and Essex Counties has the highest jump of +8.3 per cent, from $19.85 to $21.50 Despite the annual October 1st increase to the provincial minimum wage to $17.60, there is still no place in Ontario where you could work full-time and cover all your expenses.
There is a growing list of employers who want to know that their employees are able to make ends meet. This is the end goal of our calculation work and certification program: signing up certified living wage employers across Ontario. In order to qualify for certification, all employees must make at least a local living wage, and many see a raise as a result. The problem of working poverty is complex, and is the product of issues of affordability, policy, cultural norms and attitudes about the value of work and more. Yet the most expedient first step is to simply ensure that a day’s work can cover that day’s expenses.
The 2025 living wage calculations include a more accurate reflection of rental costs in the province through the Rural Ontario Institute’s Rural Housing Information System. The RHIS has collected advertised rental costs for rural communities across the province. This data has been used in some communities to fill in gaps where Canada Mortgage and Housing Corporation (CMHC) does not provide coverage.
Advertised rental costs have calmed and, in some cases, decreased since 2024. However, the data sources that have historically been used for the cost of rent in our province provide an average rent that is much lower than advertised rental costs. As the gap between rental estimates sourced through the CMHC as well census data and advertised rental costs have grown, there has been concern that the living wage calculations may not be accurately reflecting these costs. In response, new data from the RHIS have increased the relevance of our housing figures used in the calculations.
In addition to our work on the calculation, The Ontario Living Wage Network (OLWN) encourages employers to pay at least the living wage to workers through our certification program. At the time of this writing, there are 639 certified living wage employers in the province who have made this commitment. Our goal is to raise wages in Ontario and address poverty through paid work.
The Living Wage Regions
The living wage regions build from Statistics Canada’s geographic concept of economic regions. Economic regions are geographic units defined by Statistics Canada to represent regional economies. These geographic groupings, as well as the city of Hamilton and two census metropolitan areas also defined by Statistics Canada – Toronto and Ottawa – are used to create the official living wage regions.
A key consideration when establishing the living wage regions is to verify that people live and work in the same regions. Data on commuting patterns from the 2016 census was used to validate that this is, in fact, the case.
Calculating the Living Wage
Data is collected for the costs of a basket of goods and services for three types of households: two parents aged 35 and two children aged 7 and 3, a single parent with a child age 7, and a single adult.
The living wage rate is the before-tax income that each adult would need to earn to cover the expenses included in the basket for their family type. The calculation includes government transfers the family may receive (like the Canada Child Benefit, the Ontario CARE benefit) and the payroll and income taxes the adults may pay.
Basic Living Wage Formula Calculation
The wage is calculated for each of the three households, and a weighted average of these wages is taken based on the proportion of adults in Ontario in each type of family using data from the 2021 census.
Single adults: number of persons not in census families in Ontario aged 15-64 – 1,630,980 (33.8%)
Single parents: number of parents aged 15-64 in one-census-family one-parent households in Ontario 391,875 (8.1%)
Families of four: partners aged 15-64 in one-census family household with children without additional persons - 2,801,870 (58.1%)
The Cost of Living in Ontario
The annual expenses for all basket items required for the three household types is collected for 42 communities (counties, districts, regions) across the province.
Next, this county-level data is aggregated to the economic region level using population-weighted averages (e.g., Windsor, Essex, Chatham-Kent, and Lambton County are combined into the Southwest region). An additional 4% is added to this total level of expenses as a contingency measure.
Next, the level of earned income, taxes, and transfers that would provide each household with the amount of income needed to cover these expenses is found. To calculate the living wage, we then divide the earned income by 52 weeks in the year and 35 hours per week (and by 2 for families of four) to arrive at an hourly living wage.
The data used for these expenses come from various sources, outlined in the section below. All data are in 2025 dollars (adjustments are made using CPI values from Statistics Canada tables 18-10-0005-01 for years up to 2023 and table 18-10-0004-13 for 2023 when source costs were not in 2025 dollars).
Food
Statistics Canada Consumer Price Index, September 2025[i] reports that the cost of food was 3.5% and 4% higher than August and September of 2024. This increase in year over year costs is due to an increase in price of fresh vegetable and sugary confections.
Food costs were sourced from the most recent Nutritious Food Basket (NFB) data collected by local Public Health Units [ii]across the province.
Annual Food Expenses
Shelter
A new data source has been utilized in this year’s living wage calculations in an effort to better reflect shelter cost estimates. Rental costs have historically been sourced from the Canadian Mortgage and Housing Corporation (CMHC)[iii] or census data. The CMHC provides average rental costs in urban areas with a population of more than 10,000 people. The data collected includes all rental units in a community that meet the requirements of their methodology. This means that both units rented for multiple years and those newly rented are included in the average cost of rent in a community. Rapidly increasing rental costs over the past ten years have created a growing gap between the data collected by CMHC and current market rental rates. In communities where data from CMHC is not available, the Canadian Rental Housing Index [iv]is used as a source for average rental costs. The average cost of rent for the 3rd Quintile is used in the calculation. These numbers are from the 2021 census and as such are offset using Consumer Price Index (CPI). [v]
This year we have introduced data collected by the Rural Ontario Institute (ROI)[vi] and published in their Rural Housing Information System (RHIS)[vii]. The RHIS is a tool meant to fill the gap in rural housing information. Data is collected monthly from Kijiji and Realtors.ca and the average cost per month for 1-, 2- and 3-bedroom rentals is listed. This data has been included in some areas in each of the economic regions with the exception of Hamilton, Ottawa and the Greater Toronto Area to phase in the use of costs that are closer to current market rental rates.
To address the gap between costs reported by the CMHC and current market rental rates in the three census metropolitan areas of Hamilton, Ottawa, and the Greater Toronto Area we look to data provided by a custom report from Statistics Canada based on 2021 census data. For these regions, the rental costs were calculated as the average of the average rent reported by CMHC and the median rent for renters who had moved within the past year reported by Statistics Canada.
A report from Rentals.ca[viii] states that the average asking price rent in Canada has decreased by 3.2% in the past year. However, in the 2025 Mid-Year Rental Market Update[ix] CMHC reports that turnover rents are continuing to increase. In addition, while some advertised rental costs may be lower than last year this does not mean that costs in occupied rental units have decreased. The report states that last year in Toronto vacant 2-bedroom units cost 44% more than occupied units. This was the highest discrepancy within major Canadian cities.
Reference Family Rental Requirements
It is assumed that our reference family of four with a boy and a girl will need a 3-bedroom apartment. Our single parent will need a 2-bedroom apartment, and the single adult a 1-bedroom apartment.
Utilities
Hydro costs for each community are found through the Ontario Energy Board bill calculator[x]. Tenant insurance costs are sourced through rates.ca.
Annual Shelter Expenses
Clothing and Footwear
Annual costs for clothing and footwear are sourced through the Survey of Household Spending[xi]. The average spending on these items for those at the 3rd quintile of income are assumed to be constant across regions. These costs are adjusted using Consumer Price Index[xii] to find the costs for 2025.
Children’s clothing 0–14 represents the amount spent on children’s clothing per household (not per child). Census Data was used to estimate how much is spent per child rather than per household. In the average Ontario household there are 0.41 children. This was used to offset the costs provided by the SHS to ensure a more accurate cost for clothing and footwear for children.
Annual Clothing and Footwear Expenses
Transportation
In rural areas or areas with insufficient transit, it is assumed that an adult will need a car to get to and from work. In an urban area with a sufficient public transit system, the cost of one car and one adult transit pass is included for the reference family of four. For a single adult, the cost of one adult transit pass is used. A single parent will need a car to get to and from work and to pick up their child from school and activities. In communities that have both urban and rural areas, a weighted average between the rural and urban scenarios based on rural and urban populations is used. Consultation with local community groups helps to provide a local context to determine how availability and reliability of local transit systems.
The cost of car ownership and operation is sourced through VRM Canada [xiii]and Statistics Canada[xiv] data on average gas prices and car maintenance in Ontario. Car insurance costs are sourced through rates.ca.
This year there have been a couple changes to the way the cost of car ownership and operation is calculated. Upon review it became clear that the cost of an oil changes was being duplicated in the calculation. This expense is covered in the cost of car ownership and operation which is collected from the Survey of Household Spending. In previous calculations it has been assumed that the average number of kilometers driven per year is 20,000. However, further research has indicated that in urban areas the average number of kilometres driven per year is 16,000. This adjustment has been made for transportation costs in urban areas.
The 2025 cost of car ownership and operation in urban areas is $7241 and $7609 in rural parts of the province. The cost in urban areas reflect a decrease from the 2024 car ownership and operation estimate of $7584. The slight increase in rural areas can be attributed to rising costs of car maintenance and repair.
We typically find lower transportation costs in larger urban areas where most or all of the population has access to public transit.
Annual Transportation Expenses
Adult Education
The living wage methodology includes the cost of one continuing education course per adult. The final course cost is an average of four courses from different disciplines, and their textbook fees from one college from each economic region. The costs of adult education for the reference family of four is doubled to account for both parents. On average one course with text books costs $485. This cost has decreased from last year. While the cost of college courses remains similar to the year prior more options for online text books and required reading are being offered. Costs for online resources are less expensive than physical books.
Medical Expense, Life and Critical Illness Insurance
The costs for non-OHIP medical insurance, life insurance and critical illness insurance are sourced through Manulife. The non-OHIP medical insurance plan is used as a comprehensive coverage package that includes: prescription drugs, dental care, vision care, and other health practitioner expenses such as registered massage therapy, acupuncture, and more.
Annual Medical, Life and Critical Illness Expenses
Communications
Internet and cellphone costs are sourced locally for each community. Communication costs vary across the province based on the coverage area for cell service providers and the type of internet connections available. Often costs for communications are more expensive in rural areas. This is particularly true in northern communities.
Annual Cell Phone and Internet Expenses
Child Care
Childcare costs were sourced locally from child care centres across the province. While this is a major contributor to annual family expenses, these costs are offset by the government childcare subsidy for some of the household types in some economic regions. In January of 2023, the Canada-Wide Early Learning and Child Care (CWELCC)[xv] system reduced childcare fees for children 6 and under by 52.75%. By September 2025, fees were expected to drop to an average of $10 a day. However, the fees gathered for the 2025 living wage calculation are an average $21.20 per day. Care for the 7-year-old was not affected by the CWELCC program, meaning that single parent reference family continues to see an increase in childcare expenses. Costs for full day child care for the 3-year-old and before and after care have remained fairly similar from 2024. However, costs for day camps have increased by an average 3%.
Childcare costs incorporate the daily fees for full-time care for a preschooler (aged 3), and before and after school care for a school-aged child (aged 7) for 251 and 187 days of the year respectively. The daily cost of day camp for the school aged child for 50 days of the year was also included.
Annual Child Care Expenses
Other expenses
Following the convention of the Statistics Canada Market Basket Measure (MBM), we calculate other expenses as 75.4% of the cost of food, clothing and footwear. The methodology used to find the cost of Other Expenses in MBM is based on a basket of goods. The cost of food used in this calculation is the amount provided in the Nutritious Food Basket. The cost of clothing and footwear used is that of the MBM estimate.
This amount is intended to cover toiletries and personal care, furniture, household supplies, laundry, school supplies and fees, bank fees, some reading materials, minimal recreation and entertainment, family outings (for example to museums and cultural events), birthday presents, a modest family vacation, and some sports and/or arts classes for the children. The participation aspect of the living wage calculation is mainly covered in this expense.
Annual Other Expenses
Government Transfers and taxes
There are several government transfers and taxes that impact workers receiving a living wage.
|
Name |
Details |
Source(s) |
|
Canadian Dental Care Plan
|
This program fully covers dental costs for all people in families with under $70,000 in family net income, with reduced coverage for families with $70,000 - $89,999 in family net income |
https://www.canada.ca/en/services/benefits/dental/dental-care-plan/qualify.html
https://www.canada.ca/en/services/benefits/dental/dental-care-plan/coverage.html |
|
Canada Child Benefit |
This benefit provides up to $7,997 for each child under 6 years of age and up to $6,748 for each child 6-17 years of age, with benefits reduced above $37,487 and $81,222 of family net income. |
|
|
GST credit |
This credit offsets the cost of GST for low-income families: · $349 base credit · $349 for spouse/common-law partner · $349 for first child in single parent · $184 eligible children It declines with family net income. |
https://www.canada.ca/en/revenue-agency/services/child-family-benefits/gsthstc-amount.html |
|
Canada Worker’s Benefit |
This benefit provides the following maximum benefits for working adults: · $2,739 for recipients with an eligible spouse or dependent, · $1,590. Benefits decline with family net income. |
https://www.canada.ca/content/dam/cra-arc/formspubs/pbg/5000-s6/5000-s6-24e.pdf |
|
Ontario Child Benefit |
This benefit provides up to $1,727 per child and declines with family net income. |
|
|
Ontario Energy and Property Tax Credit |
This credit offsets a portion of sales taxes on energy and property taxes for low-income families. |
|
|
Northern Ontario Energy Credit |
This credit offsets a portion of energy costs for individuals living in Northern Ontario |
|
|
Ontario Sales Tax Credit |
This credit offset sales taxes and pays up to $360 per person in a family, with benefits declining with family net income. |
|
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Ontario LIFT Credit |
This nonrefundable provincial tax credit provides up to $875 to low-income families and declines with family net income |
|
|
Ontario CARE Credit |
This credit offsets a proportion of eligible childcare expenses, with the proportion declining with family net income |
Government Taxes
|
Name |
Description |
Source(s) |
|
Canada Pension Plan premiums |
5.95% of taxable income above $3,500 (up to $4,034.10) is paid into the CPP |
|
|
Employment Insurance premiums |
1.66% of taxable income (up to $ 1,077.48 per person) is paid into the EI program |
|
|
Federal income tax |
Federal income tax is paid by each adult (assuming both have equivalent earned income for two parent families). CPP and EI premiums, medical insurance and adult education costs are deducted from taxable income |
|
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Provincial income tax |
Provincial income tax is paid by each adult (assuming both have equivalent earned income for two parent families). CPP and EI premiums, and medical insurance costs are deducted from taxable income |
[i] Statistics Canada Consumer Price Index, September 2025 https://www150.statcan.gc.ca/n1/daily-quotidien/251021/dq251021a-eng.htm
[ii] Ontario Nutritious Food Basket (ONFB) food cost data collected by members of Ontario Dietitians in Public Health Food Insecurity Workgroup, May-June 2023.
[iii] Rental costs for urban communities of 10,000 or greater - Canadian Housing and Mortgage Corporation – Housing Market Information Portal
[iv] Rental costs for communities not covered by CMCH - Canadian Rental Housing Index
[v] Statistics Canada. Table 18-10-0005-01 Consumer Price Index, annual average, not seasonally adjusted
[vi] Rural Ontario Institute - https://www.ruralontarioinstitute.ca/
[vii] Rural Housing Information System - https://www.ruralontarioinstitute.ca/RHIS
[viii] https://rentals.ca/national-rent-report
[ix] 2025 Mid-Year Rental Market Update - https://www.cmhc-schl.gc.ca/observer/2025/2025-mid-year-rental-market-update
[x] Ontario Energy Board – Bill Calculator
[xi] Clothing and footwear costs - Statistics Canada. Table 11-10-0223-01 Household spending by household income quintile, Canada, regions and provinces.
[xii] Clothing and footwear CPI - Statistics Canada. Table 18-10-0005-01 Consumer Price Index, annual average, not seasonally adjusted
[xiii] Cost of Car ownership - https://www.vmrcanada.com/#google_vignette
[xiv] Average gas price - Statistics Canada. Table 18-10-0001-01 Monthly average retail prices for gasoline and fuel oil, by geography
[xv] Canada-Wide Early Learning and Child Care (CWELCC)
ACKNOWLEDGMENTS
Thank you to the Local Living Wage Organizers who help review local community data, and to the Ontario Dietitians in Public Health Food Insecurity Workgroup for facilitating the sharing of 2025 Ontario Nutritious Food Basket (ONFB) food cost data.
Thank you to Ontario Dietitians in Public Health Food Insecurity Workgroup for facilitating the sharing of 2025 Ontario Nutritious Food Basket (ONFB) food cost data.
Research and Calculations: Silas Xuereb and Robin Shaban at Deetken Insight
The work of the Ontario Living Wage Network is made possible by the collection of annual employer fees and additional support of these organizations and businesses:
ABOUT THE AUTHOR
Anne Coleman is the program manager for the Ontario Living Wage Network. She has been with the OLWN since its inception in 2017, and prior to that with Living Wage Waterloo Region. Anne believes in reducing poverty through paid work and is dedicated to raising wages in Ontario.