Dec 16 2006
The 80/20 Rule in Canada … sort of
The National Union of Public and General Employees recently reported that in Canada, 20% of the population owns 75% of the country’s national wealth. This is a bad thing according to the union, but should the statistics be a surprise?
This seems to be in line with the Pareto Principle (more commonly known as the 80/20 rule, less commonly known as the law of the vital few and the principle of factor sparsity). This principle states that for many occurrences, 80% of the consequences are the result of 20% of its causes.
While it would be foolish to apply this principle to everything, it is generally and surprisingly accurate. In Canada, the top 20% increased their wealth by 19% between 1999 and 2005, which lead to this application of the 80/20 rule in their case.
So what does this mean? Wealth should be more distributed among the population so that everyone should have an equal share of it? Sounds like socialism. How did 20% of Canadians manage to grab 75% of Canada’s wealth?
It may have something to do with what they focus on, as opposed to the many other conclusions one would arrive at. The wealthy 20% very likely achieved their status by setting goals and worked towards their attainment. Most people go through life with only the ambition of putting food in their stomach and a roof over their heads, which is precisely what they get and no more.
The fact is that most of the wealth throughout this world is owned by a minority of people. If you want a share of this wealth, you need to set goals and make a plan to achieve them. You won’t have that much competition because the majority of people don’t do this. They prefer to go where circumstances lead them.