not all visible minorities face labour market discrimination
Transcription
not all visible minorities face labour market discrimination
NOT ALL VISIBLE MINORITIES FACE LABOUR MARKET DISCRIMINATION Derek Hum and Wayne Simpson The most popular way of determining whether Canada’s visible minorities face discrimination in the labour market is simply to compare their average wages and annual earnings with those of white Canadians. This is naive in two ways: It does not distinguish among different visible minorities and it does not control for other possible differences between visible minorities and white Canadians—in education or experience, for instance. A statistical explanation of the wage gap finds that among native-born Canadians only blacks face a statistically significant wage gap once other variables are controlled for. Among immigrants, however, an unexplained wage gap is common. This suggests policy should focus less on employment or wage equity and more on helping immigrants integrate into Canadian society. La façon la plus courante — et la plus simple — de juger si au Canada les minorités visibles sont en butte à la discrimination sur le marché du travail consiste à comparer les salaires moyens et les revenus annuels moyens de ces minorités avec ceux des Canadiens de race blanche. Mais le procédé comporte deux faiblesses : d’une part, il n’établit aucune distinction entre les diverses minorités visibles; et, d’autre part, il ne tient aucun compte d’autres différences observables entre minorités visibles et Canadiens de race blanche — en matière d’instruction et d’expérience, par exemple. Or, l’analyse statistique révèle que, une fois prises en compte les autres variables, l’écart salarial parmi les Canadiens de naissance ne touche de façon significative que les Noirs. Parmi les immigrants, par contre, on observe généralement un écart salarial qui reste sans explication. Cela donne à penser que les politiques du travail devraient mettre l’accent sur l’aide à apporter aux immigrants pour faciliter leur intégration à la société canadienne, plus que sur les problèmes d’emploi ou d’équité salariale. C anada’s image of itself as a multicultural country reflects its proud history of welcoming immigrants and its more recent record of tolerance for peoples of different colour. Rich in resources but sparse in population, Canada has traditionally encouraged people from other lands to farm its West, construct its railroads, settle its North and live in its cities. In time, Canada’s population would both prosper and grow, and its economy would move from its reliance on staples and become an industrialized one. Despite this history and despite today’s hearty economic performance and low unemployment, Canadians are ambivalent about immigrants. Some of us want more; others believe we attract too many. Those who would put stricter limits on immigration may fear that Canada’s economy cannot absorb more people, or that our labour market cannot provide lesser-qualified workers with jobs. It may even be worrisome to many that two-thirds of Canada’s immigrants of late have been visible minorities—that is, “persons, other than Aboriginal peoples, who are nonCaucasian in race or non-white in colour” (as the federal Employment Equity Act puts it). If visible minorities do face narrower economic opportunities than whites, then it may well be true that the most recent waves of immigrants may not fare as well in the labour market as their predecessors have. In the United States, blacks and hispanics earn less than whites, while Japanese- Americans earn more. Is the same true for Canada? And if there are differences in economic outcomes across ethnic groups, what explains them? Differences in education? In skills and work experience? Cultural or language factors? Or simply discrimination? In this short article, we can’t hope to answer all these questions. But we will try to shed light on one important question by investigating the wages offered to different visible minority groups. POLICY OPTIONS DECEMBER 2000 45 Derek Hum and Wayne Simpson Table 1 Economic outcomes by visible minority (VM) group Only 6.3 per cent of the nonvisible minority sample are immigrants while between Group Not VM VM Black Indo-Pakistani Chinese Non-Chinese orientals Arab Latin American Annual earnings Hourly wage Annual hours Average age Per cent male Per cent immigrant $26,328 23,133 24,880 21,461 22,424 25,411 $14.99 12.75 12.94 11.83 13.47 12.70 1623.6 1621.7 1558.7 1657.7 1480.2 1739.3 36.5 35.3 35.5 33.1 35.9 36.4 52.4 51.4 39.2 60.4 47.2 45.0 6.3 78.0 63.9 86.1 72.5 83.1 22,711 19,085 14.11 11.52 1915.1 1470.5 35.2 35.1 68.9 60.6 82.0 85.8 64 and 86 per cent of each visible-minority group consists of immigrants. Thus, if being an immigrant means facing disadvantages in the labour market, this could be more responsible for the wage differentials observed across groups than being a visible minority per se. 46 OPTIONS POLITIQUES DÉCEMBRE 2000 Note: Non-Chinese Orientals comprise Korean, Japanese, South East Asians, Filipinos, and Oceanics. Because the sample size for each of these groups individually is relatively small results are weighted to provide estimates for the Canadian population. Source: Calculations by authors from SLID (1993) master file. T he kind of information reported by the media concerning earnings of visible minorities is typically very aggregated and conceals important relationships. Consider Table 1, for example. It presents annual earnings and hourly wage rates, as well as selected characteristics, for whites and various visible minority groups. The figures are calculated from Statistics Canada’s Survey of Labour and Income Dynamics (SLID) master file. It provides finer distinctions among groups than the publicrelease data, which only report whether a respondent is, or is not, a visible minority member. Accordingly, most commentators simply report comparisons between whites and all visible minorities combined together as a group. The first two rows of Table 1 indicate that, grouped together in this way, visible minorities in Canada had annual earnings of $23,133 in 1993 and an hourly wage rate of $12.75, compared to $26,328 and $14.99, respectively, for whites. It looks very much as if “colour” is a discriminating factor in Canadian labour markets. Although each of the visible-minority groups in Table 1 has less earnings and a lower wage rate than white Canadians do, there is evident variation among the different visible-minority groups. They are roughly the same age on average, but the proportion of males differs considerably across groups. It therefore seems possible that the hourly wage rates and annual earnings of visible minorities are driven down, not so much because they are visible minorities but because they are disproportionately women, who are well known to earn lower wages than men. In the same way, there is extremely wide variation in immigration status: Only 6.3 per cent of the non-visible minority sample are immigrants while between 64 and 86 per cent of each visible-minority group consists of immigrants. Thus, if being an immigrant means facing disadvantages in the labour market, this could be more responsible for the wage differentials observed across groups than being a visible minority per se. Yet another complication is the variation in hours worked by the various visible-minority groups. For example, non-Chinese Orientals and Arabs apparently compensate for their lower wage rates by working longer hours. Accordingly, hourly wage rate differentials are probably a better measure of labour market opportunity for paid workers than annual earnings. In fact, there may be more differences in economic opportunity than differences in annual earnings might suggest, and the minorities in question have to make up for these differences by working longer. On the whole, Table 1 is a useful warning against hasty generalization about the structure of opportunities or discrimination in the Canadian labour market W ithin limits, the detailed nature of the SLID data allows estimates of the relative magnitudes of wage differentials for different visible minority groupings. Still, the need to build up samples that are of a significant size statistically forces us to mask considerable variation within sub-groups. For example, although Japanese-Canadians have annual earnings well above those for whites, their small numbers make Visible minorities in the labour market statistically reliable comparisons difficult. In fact, small sample sizes for Koreans, Japanese, Southeast Asians, Filipinos and people listed as “Oceanic” force us to group them together as “non-Chinese Orientals.” As mentioned, many other factors beyond colour and immigrant status may give rise to differences in wage offers to job seekers, among them: gender, age, education, skill level, language knowledge, Canadian work experience and the like. Economists argue that a number of these variables represent a person’s “human capital,” since they are assumed to increase productivity and are therefore likely to attract higher wages. In our statistical work, we investigate whether the wage gap between whites and these various nonwhite groups can be explained by the variables we have mentioned. Unfortunately, we don’t have data on people’s work experience in Canada But since the ease with which persons born outside Canada are able to access job opportunities and to learn the workings of the Canadian labour market probably increases with years spent in Canada, we approximate this aspect of human capital by noting the years since migration of immigrants to Canada. Because employers are unlikely to pay exactly the same wages even to seemingly-identical workers, a wage gap is not meaningful unless it is statistically “significant” in the technical sense that it is unlikely to result simply from chance. As it turns out, several of the factors we look at have an influence on the minority/non-minority wage gap that is statistically significant at the “five per cent level”—that is, if the variable in question really weren’t related to the wage gap, we would expect to be so unlucky as to draw a sample that suggested it was only once in 20 draws. Our results are summarized in Table 2. As the first line of the Table shows, after accounting for other factors, including how long it has been since people immigrated and how old they were when they did, the simple fact of being a member of a visible-minority group is significant in explaining the wage gap with white Canadians only for immigrant men. For Canadian-born men, being a member of a visible minority has no significant effect in explaining the wage gap. The same is true for both immigrant and native-born women. As shown by Table 2’s other rows, however, among the different visible minority groups, there is a significant wage disadvantage for black men: 16.6 per cent for immigrants and 25.6 per cent for those born in Canada. There are also significant disadvantages for immigrant men who are members of the Indo-Pakistani group (19.0 per cent), the Chinese group (17.3 per cent), and the non-Chinese Oriental group (23.9 per cent), as well as significant disadvantages for nonChinese Oriental immigrant women (11.5 per cent). For all other groups, the difference is insignificant. In particular, we note that among native-born Canadians only black men appear to suffer a significant disadvantage in the labour market. T he full import of our findings, should they be confirmed by further research, is that visible minorities who are native-born are for the most part not disadvantaged; it is mainly among immigrant males who are visible minorities that a statistically significant unexplained wage gap Membership in a visibleminority group is significant in explaining the wage gap with white Canadians only for immigrant men. For Canadianborn men, being a member of a visible minority has no significant effect in explaining the wage gap. Table 2 Estimated wage gap in per cent between Canadians who are not members of visible minority groups and those who are Visible minority MEN Immigrant All Black Indo-Pakistani Chinese Non-Chinese Oriental Arab Latin American 14.6 16.6 19.0 17.3 23.9 11.2 -18.2 * * * * * WOMEN Native-born Immigrant 3.1 25.6 * -8.0 -4.7 1.6 -29.3 32.6 5.5 -1.1 2.3 9.9 11.5 * -15.7 9.2 Native-born 2.7 -13.0 8.5 -2.4 17.2 23.4 9.3 * Denotes significance at the five per cent level. A negative sign indicates a wage difference in favour of the visible minority group. Source: Calculations by authors from SLID (1993) master file. POLICY OPTIONS DECEMBER 2000 47 Derek Hum and Wayne Simpson Our findings sound a note of caution in treating visible minorities as a homogeneous group for public policy purposes, particularly employment equity strategies exists. One possible interpretation of this result is that Canada is not overtly discriminatory in terms of visible minorities in general, but that labour market disadvantages do exist for immigrants specifically. On the other hand, black males, both foreign and native-born, appear to suffer substantial wage disadvantage, a finding that clearly demands further investigation. W hether visible minorities are full participants in the Canadian economy is obviously an important policy issue. As things stand, together with women, aboriginal peoples and persons with disabilities, visible minorities are a designated disadvantaged group under federal employment equity legislation. Our research reveals the danger of simple comparisons between the wage rates and earnings of white and non-white Canadians. Such exercises are incomplete and misleading, both because they combine all visible-minority individuals without distinguishing across groups whose experience may in fact be quite different, and because they ignore other determinants of wages and earnings, such as an individual’s education, work experience or degree of assimilation into the Canadian labour stream. In our judgment, a more accurate picture of reality is provided by our Table 2, which makes clear that, with the exception of black men, there is no significant wage gap between visible minorities and white Canadians who were born in Canada. It is only among immigrants that wage Que fera M. Rock ? Un jour, le Dr. Jacques Lemire, un éminent ophtalmologiste de l’hôpital Notre-Dame, en a eu assez des listes d’attente. La sienne comptait des centaines de patients, en attente depuis un an et demi, lorsque, désabusé, il a remis son sarrau à l’hôpital et s’est “désinscrit” du régime de l’assurance-maldie du Québec. “J’ai vécu l’époque où on opérait rapidement. Avec les années, plus j’opérais, plus la liste s’allongeait. Quant j’ai cessé, je n’opérais plus qu’une journée par semaine, et j’étais béni. Certains collègues n’avaient qu’une demi-journée par deux semaines à l’hôpital!” dit-il. Aujourd’hui, ce vétéran de la profession opère tranquillement ses patients dans une clinique privée de Laval où l’on peut, en déboursant 2400 $, obtenir sans délai une chirurgie de la cataracte pour un oeil. Oubliez les corridors bondés, les salles d’attente, les 60 patients à examiner à la hâte en une seule journée. À cette clinique bon chic bon genre, 48 OPTIONS POLITIQUES DÉCEMBRE 2000 differentials are observed. What implications do our findings have for public policy? Ours is but a first attempt to disentangle the determinants of wages paid to Canadians of colour, and we have focused purely on an economic examination of wages and earnings. It does not address the unique histories of different visible groups; for example, the circumstances of black or Chinese Canadians, and why the wage gap remains large and persistent for black but not Chinese Canadians after generations in Canada. But at the very least, our findings sound a note of caution in treating visible minorities as a homogeneous group for public policy purposes, particularly employment equity strategies. More ambitiously, it may now be time to rethink Canada’s emphasis on achieving equal opportunity in the labour market. Our findings suggest that the steps towards a colour-blind Canadian labour market offering opportunities for all may have to focus more on helping immigrants assimilate in the economy and less on employment equity legislation. Derek Hum ([email protected]) and Wayne Simpson ([email protected]) are professors of economics at the University of Manitoba and Research Affiliates with the Prairie Centre of Excellence for Research in Immigration and Integration (PCERII). This paper follows on their recent work in “Wage opportunities for visible minorities in Canada” Canadian Public Policy (XXV: 3, 1999). on vous octroie un rendez-vous le lundi, pour une opération trois jours plus tard. Vite fait, bien fait, on vous traite aux petits soins. “On dit que c’est une médecine pour les riches, mais je vous jure que je n’ai pas beaucoup de multimillionnaires qui viennent s’asseoir sur ma chaise. Attendre un an et demi pour bien voir, c’est indécent” explique le Dr. Lemire... Au Québec, le glissement vers le privé n’est plus une vague impression. Il fait subtilement éclosion ça et là, incitant de plus en plus souvent les patients à puiser dans leurs poches pour court-circuiter un système devenu trop lent à leur goùt. Traitements de physiothérapie, chirurgie de la cataracte ou du genou, tests en tout genre, allant de la simple analyse sanguine au plus sophistiqué des scanners: autant de services qu’un patient, devenu impatient, peut désormais obtenir en déliant les goussets de sa bourse. Isabelle PARÉ, Le Devoir, 1er mai 2000