Canada’s gender wage gap worse when including certain demographic traits: report

Although Canada has a wide range of federal and provincial legislation intended to ensure Canadians can benefit from the labour market equally, gender wage gaps continue to persist along gender and race lines, according to a new report by the C.D. Howe Institute.

In good news, the gender wage gap, on an hourly basis, is starting to close in Canada. In 2000, men made 27 per cent more than women per hour on average in the private sector, while the difference was 19 per cent in 2019.

However, an adjusted wage gap — accounting for more demographic traits including age, marital status, whether one has children under age six, education and province of residence — is actually worse, at 21 per cent, slowly declining since 2000.

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One major factor accounting for the gap is the propensity for men and women to enter certain industries. “Men are more heavily represented in industries like construction, the manufacturing of durable goods or resource industries like mining, oil and gas,” the report said.

“While 14 per cent of men worked in construction industries in 2019, only three per cent of women did. Women are more likely to be employed in service industries, holding jobs in retail, health services or other services like accommodation and food. While 17 per cent of women worked in the health and social assistance industries in 2019, only two per cent of men did. Consider that average hourly wages in construction are $32 per hour, while average wages in health care and social assistance are $24 per hour. In this context, it becomes clearer that women are more highly represented in lower-paying types of jobs, resulting in lower average wages than men.”

The report emphasized that the tendency for men and women to appear heavily in certain industries is not simply to do with preference, but analysis should include “traditional expectations for women’s careers, their role in the household and their responsibilities in caring for family members will shape their career plans including their choices for education and training before they come to the job market.”

Further discriminatory action on the part of employers adds to the tangle of multiple factors, the report noted.

And race enters the wage picture as well. The report suggested that the impact of having a specific racial identity on wages may be stronger for women than men.

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Examining data from 2015, the report found white women working full time, year round, earn about 30 per cent less than white men. Meanwhile, visible minority women earned 17 per cent less than white men, while Indigenous women earned 44 per cent less. The difference was less pronounced between men, with visible minority men earning eight per cent less than white men and Indigenous men earning 18 per cent less.

“Pay equity legislation has generally been ineffective in the private sector, as comparisons across male- and female-dominated job classes at the same company can be challenging,” said Tammy Schirle, a professor of economics at Wilfrid Laurier University and one of the report’s authors, in a press release. “Employment equity legislation could work to improve representation of women, Indigenous peoples and visible minority groups in higher-paying occupations. However, the existing Employment Equity Act only applies to workers in federally regulated firms, who represent a small fraction of private-sector workers. When you take this into consideration, the shortcomings of such policies start to become apparent.”

Read: Feds introduce pay equity legislation