Literacy, Numeracy, Technology Skill and Labour Market Outcomes among Indigenous Peoples in Canada

Abstract

We use the 2012 Programme for the International Assessment of Adult Competencies to examine proficiency in information-processing skills, educational attainment and labour market outcomes among Indigenous peoples in Canada. Similar to previous literature, we find negative earnings differentials, lower employment rates and higher unemployment for Indigenous populations and important differences between First Nations, Metis and Inuit people. First Nations people do much worse in terms of earnings and employment outcomes, while we find evidence that Metis people have worse employment outcomes and negative earnings differentials in the upper part of the distribution. We also find sizable literacy, numeracy and technology skill gaps. Not surprisingly, there is a positive relationship between these information-processing skills and wages. However, the returns to skills are very similar for Indigenous and non-Indigenous peoples, that is, we find no evidence of economic discrimination. Once these skills are conditioned on, the earnings differentials greatly decline. We also find that education can reduce skill and wage gaps, although the additional impact is small. The results suggest a greater need to consider barriers to education faced by Indigenous peoples.