By the numbers: Race, gender and the Canadian labour market

Canada’s population is increasingly racialized. The 2016 census counted 7.7 million racialized individuals in Canada. That number represented 22% of the population, up from 16% just a decade earlier.

Unfortunately, the rapid growth in the racialized population is not being matched by a corresponding increase in economic equality. Using 2016 census data (the most recent available), our report, Colour Coded Income Inequality, authored by Sheila Block, Grace-Edward Galabuzi and Ricardo Tranjan, paints a portrait of entrenched income inequality between racialized and non-racialized Canadians as well as labour market discrimination faced by racialized workers. The trends show that little-to-no progress has been made to close these gaps between 2006 and 2016.

Here are seven things we learned about the way racism is manifested in the labour market.

Racialized workers are more likely to be active in the workforce than non-racialized workers, either working or trying to find work, but this does not result in better employment outcomes for them. From 2006 to 2016, there was little change to patterns of employment and earnings inequality along racial and gender lines in Canada.

Racialized women have the highest unemployment rate at 9.6%, followed by racialized men at 8.8%, non-racialized men at 8.2%, and non-racialized women at 6.4%. Overall in 2016, the racialized population had an unemployment rate of 9.2% compared to the non-racialized rate of 7.3%.

Labour market discrimination continues to be gendered and racialized. Racialized women earned 59 cents for every dollar that non-racialized men earned, while racialized men earned 78 cents for every dollar that non-racialized men earned.

The gap narrows when comparing the incomes of racialized and non-racialized women, with racialized women earning 87 cents for every dollar that non-racialized women earn. Little progress was made in reducing this gap over the 10-year period examined in our study.

Colour-coded income inequality are also visible in the gaps in family incomes. The data show racialized individuals are more likely to be in families in the bottom half of the income distribution (60%) than non-racialized individuals are (47%),. The racialized groups most overrepresented in the bottom half are Arab, West Asian, Korean and Black.

In 2015, 20.8% of racialized Canadians had incomes below the LIM — lower-income measure — (after tax), compared to 12.2% of non-racialized Canadians. All racialized groups except those who identified as Filipino had higher poverty rates than non-racialized Canadians. Those who identified as Arab, West Asian and Korean had poverty rates above 30%, or nearly three times higher than those of their non-racialized neighbours.

Census data show a racialized gap in income from wealth in 2015. The racialized gap in capital gains is clear: 8.3% of the racialized population over the age of 15 reported capital gains, compared to 11.9% of the non-racialized population. The average amount of capital gains of non-racialized Canadians ($13,974) was 29% higher than the average capital gains of racialized Canadians ($10,828). The data on investment income also shows a clear, racialized gap. In 2015, the average investment income for the non-racialized population ($11,428) was 47% higher than the average for the racialized population ($7,774).

Data indicate that differences in immigrants’ labour market outcomes make it clear that immigration isn’t the only issue.

Non-racialized immigrants experience better outcomes, sooner, in the Canadian labour market, than racialized immigrants do. What’s more, income inequality between racialized and non-racialized Canadians extends to the second and third generations—and beyond. Among prime-age (25–54 years old) workers, racialized immigrant men earned 71 cents for every dollar that non-racialized immigrant men earned. Racialized immigrant women earned 79 cents for every dollar that non-racialized immigrant women earned.

Our analysis also illustrates the importance of understanding the distinct barriers in the labour market faced by different racialized groups. Both men and women who identified as Black had higher labour force participation rates than their non-racialized counterparts. However, they also had higher unemployment rates and bigger wage gaps than the average for all racialized workers. Men who identified as Filipino had much lower unemployment rates than the average for racialized workers and yet had a larger earnings gap, while women who identified as Filipino had lower unemployment rates and a smaller earnings gap than the racialized average.

Canada's Colour Coded Income Inequality was released in December 2019. Find the report on the CCPA website.