Limestone Partner Andrew Ault, MBA, MSc [C] has recently completed a new paper, analyzing Canadian Census data to understand how discipline choice effects the Indigenous skills gap.
This study examines categorical difference in financial returns gained from post-secondary education between First Nations, Metis and non-Indigenous peoples by factoring in the discipline of study. The purpose of this study was to see whether there is any difference on the impact study fields and credential has on total income between these groups.
Limestone’s analysis was based on a microdata file of the 2011 Canadian Census.
A number of linear regressions were modelled, with total income being the dependent variable and discipline, credential and Indigenous Identity being the independent variables of interest.
Accounting for age group, gender and regional controls, it is found that discipline and credential factor greatly into the projection of one’s earnings, which impact the wage gap between Indigenous and non-Indigenous peoples.
In particular, the findings appear to suggest that University administrators should concentrate their efforts in recruiting Indigenous peoples to higher degrees of credential, and directing their disciplines toward STEM, Business and Social Science fields.
“Understanding this gap would be useful to institutions (ie universities), municipalities and mining organizations’ whose social responsibility obligations are to shrink the indigenous skills gap, namely by promoting educational achievement through specific disciplines.”
-Andrew Ault, MBA, MSc
Partner, Limestone Partners Canada Inc.
As in the table to the left, controlling for gender, age and region; it was observed that total income is greatly impacted by education credential and discipline pursued. Such model accounts for 11.6% of variance in wages, with Business abd STEM disciplines accounting for 10.2% and 11.3% of variance respectively.
As seen, First Nations face the most inequality by having reductions in salaries, with relevant controls, of $9,006.75 to a non-Aboriginal compared to a decrease of $4,036.81 for Metis. Second, with relevant controls it is interesting to observe that high school diploma graduates without post-secondary who are employed full time earn more than Apprenticeship and College graduates when accounting for these controls. This could be a case of supply and demand during the time the census was polled. In terms of discipline, some interesting observations can be made.
Contra popular belief, indigenous business graduates earn more than STEM field graduates at $18,279.65 more than an Education graduate. What is more amazing is the similarities in incomes between Social Science graduates and STEM graduates. Both variances may be a cause of over-collapsing the variable for STEM fields. Gender is, as expected, yielding significantly less income for females than males, at $19,603.86.
However, this study did not account for job tenure, hours worked or family status which may impact this result. Further, this result may be different if focussed on recent graduates given the outpacing of degree enrolment by women in Canadian universities. Regional disparities are also quite prevalent. In specific, British Columbia, Quebec and Atlantic Canada earned less on average, than Ontario did in 2005.
When observing this result, it would be wise to also factor in the myriad of differences that have occurred to the economic composition of Ontario and other regions in times since 2005. Lastly, age group also netted interesting results. It was found that those aged 45-49 and 50-54 earned more, on average, than those 55-64. This may be a result of different skills learned through life of the 45-54 range and the greater need for increased need for retention.
