Matthew Lau: Systemic racism isn’t the reason for Indigenous income gaps

Canadian dollars and tax calculation on calculator. Getty Images Photo by Andrzej Rostek /Getty Images

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Given how prevalent diversity, equity and inclusion (DEI) has become in recent years — notably in the federal government — it’s important to state some facts.

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For example, according to the federal government’s anti-racism strategy, “Systemic anti-Indigenous racism accounts for the fact that compared to non-Indigenous People, First Nations, Inuit, and Métis experience poorer social, economic, and political outcomes than their non-Indigenous counterparts.” But according to the data, factors such as education and geography largely explain the differences in average incomes between Indigenous and non-Indigenous Canadians.

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In fact, as noted in a new study by the Aristotle Foundation, when Indigenous Canadians have a trade or university degree, live near a major urban centre and work full time, they have similar — or sometimes higher — incomes than their non-Indigenous counterparts.

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Consider the latest census data, which measured incomes in 2020. Among Canadian workers who worked full time for the full year and have a bachelor’s degree or higher, the median employment income was $5,000 higher for Indigenous workers than non-Indigenous workers in Calgary, $4,000 higher in Toronto, $4,000 higher in Vancouver, $500 lower in Montreal and $2,000 lower in Ottawa-Gatineau. (All geographies refer to Census Metropolitan Areas).

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Among Canadian workers who worked full time for the full year but have no certificate, diploma or degree, the median employment income was $5,600 higher for Indigenous workers than non-Indigenous workers in Toronto, $800 higher in Vancouver, $400 lower in Montreal and Ottawa-Gatineau, and $1,600 lower in Calgary.

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As the data show, at higher levels of educational attainment (university certificate or diploma, a bachelor’s degree or higher), Indigenous workers actually slightly outperform their non-Indigenous counterparts on average. At lower levels of educational attainment, their median incomes are slightly less. It is difficult to conclude from these statistics that Indigenous workers’ incomes are negatively impacted by systemic racism.

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Overall, the median employment income in 2020 was actually 15.7 per cent lower for Indigenous workers compared to non-Indigenous workers, but much of that is because a lower proportion of Indigenous workers obtain university degrees than the general population. Another major reason is that only 50 per cent of Indigenous workers worked full time for the full year compared to 54 per cent of non-Indigenous Canadians.

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Incomes also tend to be higher in large cities where there’s more economic opportunity, and living and working in a federal or provincial capital provides more access to government jobs where pensions and job security tend to be much stronger. The data show that Indigenous workers are less likely to live in or near major urban centres — another reason for the income disparity.

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So, what’s the main takeaway?

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The data suggest that despite historic wrongs, Indigenous Canadians today are not hostages to a systemically racist economic system — they can and do prosper. When Indigenous Canadians obtain the same level of education and work the same number of hours in the same city as non-Indigenous Canadians, their incomes are broadly similar.