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  1. Analysis

1   Analysis

1.1  Employment continued to decline in 2010 among Aboriginal people aged 15 and over

The labour market downturn that began in the fall of 2008 lasted longer for Aboriginal people than for non-Aboriginal people. Employment declined by similar levels in both 2009 and 2010 among Aboriginal people aged 15 and over, with losses of 3.5% or 13,000 in 2009 and 3.7% or 14,000 in 2010 (Chart 1).

Among the non-Aboriginal population, employment declined by 1.6% in 2009 and rose by 1.5% in 2010, bringing employment back to levels just slightly below those observed in 2008.

The labour market slowdown for the Aboriginal population was reflected in both the employment rate and the unemployment rate.

At 53.7% in 2010, the proportion of the working-age Aboriginal population who were employed was 5.9 percentage points below the peak reached in 2008, declining around 3 percentage points in each of 2009 and in 2010 (Chart 2). Among non-Aboriginal people, the employment rate declined by 1.8 percentage points over the same period, to 61.8%.

After an increase of 3.5 percentage points from 2008 to 2009, the unemployment rate continued to rise in 2010 among Aboriginal people, up 0.5 percentage points to 14.3%. In contrast, among non-Aboriginal people, the unemployment rate increased by 2.1 percentage points in 2009, and then declined by 0.2 percentage points to 7.9% in 2010 (Chart 3).

Another indicator that measures labour market difficulty is the supplementary unemployment rate R8 – which adds to the official unemployment rate those who are no longer searching for work as they think no work is available (discouraged), those waiting for recall or replies and long-term future starts (marginally attached), and a portion of involuntary part-time workers (underutilized labour). This rate also shows that the Aboriginal population had more difficulty finding work than the non-Aboriginal population. Among Aboriginal people, R8 was 18.5% in 2010, a 4.5 percentage point increase from 2008. R8 among the non-Aboriginal population was 11.1%, up 2.5 percentage points from 2008 (Chart 4).

With continued employment declines in 2009 and 2010, fewer Aboriginal people participated in the labour market (Chart 5). Over the two-year period, while there was a drop in participation rates in 2009, the largest decline occurred in 2010. Their participation rate retreated to 62.6% in 2010, the lowest participation rate among Aboriginal people since comparable data became available in 2007. In contrast, the largest drop in the participation rate among non-Aboriginal people occurred from 2008 to 2009, and was 67.1% in 2010.

With fewer Aboriginal people participating in the labour market in 2010, the divergence in participation rates widened between the Aboriginal and non-Aboriginal populations. In 2010, 62.6% of the Aboriginal population participated in the labour market compared with 67.1% of the non-Aboriginal population – a gap of 4.5 percentage points. In 2008, when the labour market was at its most recent peak, the gap was only 1.2 percentage points.

Between 2008 and 2010, First Nations people living off-reserve had a larger drop in participation than did the Métis. The participation rate among the First Nations people living off-reserve declined by 4.8 percentage points over this two-year period compared to a drop of 2.7 points among Métis people.

1.2  Demographics of the Aboriginal and non-Aboriginal populations

The working-age Aboriginal population is younger than the non-Aboriginal population (Table 1). In 2006, 25% of the working-age Aboriginal population was aged 15 to 24 years compared to 16% of non-Aboriginal people. Aboriginal people also had a higher share of their population in the 25 to 54 age group. Consequently, the share of Aboriginal people aged 55 and over was lower at 17% versus 31% for the non-Aboriginal population.

In order to ensure that age differences have limited impact on the comparison of labour market outcomes, this report focuses its analysis on core-aged Aboriginal and non-Aboriginal people 25 to 54 years of age. An analysis on the youth labour market (ages 15 to 24), as well as that of older workers (aged 55 and over) is also provided.

1.3  Labour market participation and outcomes of core-aged workers

The 25 to 54 age group is referred to as 'core working-age' since people in this age group are the most likely to be participating in the labour market. There are numerous factors that can affect participation in the labour market, such as age, children in the home, school attendance, cultural factors, and labour market conditions.

In 2010, employment levels fell by 4.9% (-12,400) among Aboriginal core-aged workers, a larger decline than in 2009, when employment fell by 2.8% (-7,300). These declines were all in full-time work in both years. Over the two-year period, the employment rate fell 5 percentage points, to 65.8% in 2010 (Table 2).

In contrast, for non-Aboriginal core-aged workers, employment fell by 1.7% (-198,000) in 2009 and increased by 0.8% (+93,000) in 2010. Losses in 2009 were all in full-time work while gains in 2010 were a combination of full and part-time work. The employment rate also declined for this group from 2008 to 2010, down 1.7 percentage points to 80.9%.

The gap in the employment rates between the Aboriginal and non-Aboriginal core-aged workers increased in 2010. Compared to an average 12 percentage point difference between 2007 and 2009, the gap increased to 15 points in 2010.

While the decline in the Aboriginal employment rate in 2009 and 2010 was similar for both First Nations people living off-reserve and the Métis, the employment rate remained higher for the Métis (71.1%) than for First Nations people living off-reserve (60.8%) in 2010.

The unemployment rate for First Nations people living off-reserve also reflects their difficulties in finding work in 2010. At 14.9%, the unemployment rate for core-aged First Nations people living off-reserve was higher than that of Métis (9.8%) and the non-Aboriginal population (6.8%).

From 2007 to 2008, rates of participation in the labour market climbed at a faster pace among core-aged Aboriginal people than for the non-Aboriginal population. As well, during the 2008 to 2009 downturn, participation rate declines were of similar magnitude for both groups. However, from 2009 to 2010, participation rates declined rapidly among the Aboriginal core-aged workers, erasing all the gains made in 2008. At the same time, rates of participation among non-Aboriginal workers were similar to the previous year.

1.3.1  Unemployment rate rose more among Aboriginal men than women in the downturn

Core-aged Aboriginal men fared worse than Aboriginal women during the 2008 to 2010 period. The unemployment rate among Aboriginal core-aged men increased to 13.3% in 2010, up 4.1 percentage points over the two-year period. Over the same time, the unemployment rate of core-aged Aboriginal women increased by 1.9 percentage points to 11.3%.

The unemployment rate of non-Aboriginal core-aged men also jumped in 2009, up 2.7 percentage points to 7.9%, but then declined to 7.2% in 2010 (Chart 6). For non-Aboriginal core-aged women, it rose 1.6 points to 6.3% over the two-year period.

The decline in the participation rate also reflects the stronger impact of the downturn on Aboriginal core-aged men than women. The rate for Aboriginal men fell to 80.4% in 2010, a decline of 4.5 percentage points from 2008 (Chart 8). Over the same period, the participation rate of Aboriginal women declined by 1.2 percentage points to 70.0%.

Participation rates fell among First Nations people living off-reserve and Métis people from 2008 to 2010, but the decline was steeper among First Nations men living off-reserve. Among core-aged Aboriginal women, the participation rate decline in 2010 was steeper among Métis women than among their First Nations counterparts (Chart 9). Despite this decline, a higher percentage of Métis women were participating in the labour market in 2010 compared with First Nations women living off-reserve.

1.3.2  Largest declines in Quebec, British Columbia, Ontario and Alberta

There were above average employment rate declines in Quebec, British Columbia, Ontario and Alberta among core-aged Aboriginal people between 2008 and 2010. In Saskatchewan and Manitoba, there was little to no change in employment rates over this two-year period (Table 3).

In Quebec, the Aboriginal employment rate was 61.1% in 2010, a decline of 9.7 percentage points from 2008. In 2010, this province posted the lowest employment rate for core-aged Aboriginal people.

In British Columbia, the bulk of the decline in the employment rate occurred from 2008 to 2009. However, with continued declines in 2010, the employment rate fell 8.2 percentage points over the two-year period, reaching 62.7% in 2010. Métis core-aged workers had larger declines than First Nations workers living off-reserve.

At 63.2% in 2010, the employment rate among Aboriginal people in Ontario fell by 6.5 percentage points from 2008. The decline was primarily in 2010 and among First Nations people living off-reserve. In Alberta, the employment rate fell to 69.7% (-5.5 points) over the same period, with most of the decline occurring in 2009.

The employment rate of non-Aboriginal people fell in all provinces and regions over this two-year period, with the strongest declines in Alberta, British-Columbia and Ontario.

The highest employment rates in 2010 among Aboriginal core-aged workers were observed in Manitoba (71.0%), followed by Alberta (69.7%). Among non-Aboriginal workers, the highest rates were in Saskatchewan (86.8%) and Manitoba (86.5%).

1.3.3  Employment declines driven by manufacturing

The industries in which core-aged Aboriginal and non-Aboriginal people work differ slightly. In 2010, Aboriginal people were more likely to be employed in public administration; construction; forestry, fishing, mining, oil and gas; and health care and social assistance than their non-Aboriginal counterparts. On the other hand, non-Aboriginal people were more represented in professional, scientific and technical services; finance, insurance, real estate and leasing; manufacturing; and retail and wholesale trade than Aboriginal core-aged workers (Chart 10).

The manufacturing industry experienced severe employment losses during the 2008 and 2010 period among both Aboriginal and non-Aboriginal people. For both groups, this industry posted the largest employment declines of the 16 major industry groups during this two-year period. There were also smaller declines among Aboriginal workers in construction; business, building and other support services; retail trade; information, culture and recreation; and transportation and warehousing. Over the same period, employment rose in finance, insurance, real estate and leasing; health care and social assistance; and public administration, industries that were less affected by the employment downturn.

Among non-Aboriginal core-aged workers, employment declines over this two-year period were primarily in manufacturing; transportation and warehousing; and retail and wholesale trade. At the same time, there were gains in health care and social assistance; professional, scientific and technical services; public administration and education.

1.3.4  Employment losses by occupation

The occupational distribution is also slightly different among Aboriginal and non-Aboriginal core-aged workers. Aboriginal people were more likely to work as trades and transport equipment operators; or in sales and service occupations as well as occupations unique to the primary industry than were non-Aboriginal people in 2010. On the other hand, non-Aboriginal people were more represented in management; and natural and applied sciences occupations than Aboriginal people (Chart 11).

Between 2008 and 2010, most of the employment declines among Aboriginal people were among trades, transport and equipment operators; sales and service workers; occupations unique to processing, manufacturing and utilities; as well as management occupations. Among non-Aboriginal workers, losses also occurred among trades, transport and equipment operators; occupations unique to processing, manufacturing and utilities; managers; and occupations in business, finance and administration.

1.3.5  Other labour market indicators

Like industry and occupation, the distribution of core-aged workers by public, private or self-employment status differs slightly for Aboriginal and non-Aboriginal populations. A higher percentage of Aboriginal than non-Aboriginal workers tend to work in the public sector (Table 4). On the other hand, non-Aboriginal workers were more represented in self-employment than were Aboriginal workers.

Among Aboriginal core-aged workers, job losses between 2008 and 2010 were mainly in the private sector. In 2010, there were also fewer self-employed Aboriginal workers than two years earlier, a trend similar to their non-Aboriginal counterparts.

When deciding whom to layoff during economic downturns, employers take into account how long a worker has been working in the firm. Workers with fewer months or years at the job are usually among the first to be laid off.

From 2008 to 2010, a higher percentage of Aboriginal than non-Aboriginal core-aged workers had worked for their current employer 5 years or less, an average of 58% versus 49%, respectively.

During this same period, job tenure averaged 6.7 years for Aboriginal core-aged workers, lower than the 8.2 years for non-Aboriginal workers.

In 2007 and 2008, a similar proportion of core-aged workers were multiple jobholders among both Aboriginal and non-Aboriginal people (around 5.3%). While this rate did not change for non-Aboriginal workers during 2009 and 2010, a slightly higher percentage of Aboriginal workers were taking on more than one job at a time in 2010, at 6.0%.

Aboriginal core-aged employees were more likely to be working on a temporary basis than non-Aboriginal employees in 2010. The percentage of Aboriginal employees who worked on a seasonal, contract, or term basis increased to 14% in 2010 from an average of 12% in the previous three years. For the non-Aboriginal population, the percentage of temporary workers increased from 9.1% in 2009 to 9.8% in 2010.

Aboriginal workers are more likely to be represented by a union or covered by a collective agreement (37.2%) than non-Aboriginal core-aged workers (34.2%) in 2010. At $847.36, Aboriginal employees made 92% of the average weekly salary of non-Aboriginal workers ($916.85) in 2010.

1.3.6  Hours curtailed

During economic downturns, employers tend to cut hours first before laying off workers. Average usual hours worked at the main job per week declined in both 2009 and 2010 for both the Aboriginal and non-Aboriginal populations, with the bulk of the decline occurring in 2009 (Chart 12).

A different pattern emerged among the core-aged First Nations people living off-reserve compared to the Métis in 2010. Among First Nations people living off-reserve, average usual hours fell in both 2009 and 2010, with the largest decline occurring in 2010. Among the Métis, hours fell steeply in 2009 and then increased slightly in 2010.

Also, the proportion of First Nations people living off-reserve working part-time increased from 12.8% in 2009 to 14.8% in 2010. In comparison, the part-time rate for the Métis declined to 11.6% in 2010.

Throughout the 2008 to 2010 period, the Aboriginal population worked slightly more hours per week than the non-Aboriginal population. The Métis worked the highest usual hours per week, at 38.3. The non-Aboriginal population worked an average of 37.7 hours in 2010, while the First Nations people living off-reserve worked an average of 37.4 hours per week.

1.3.7  Employment losses shared by all levels of educational attainment

Employment rates fell within all education levels among core-aged Aboriginal people and non-Aboriginal people between 2008 and 2010 (Table 5). From 2008 to 2009, employment rate declines among both the Aboriginal and non-Aboriginal populations were larger among high school graduates and non-graduates than for those who completed post-secondary education.

From 2009 to 2010, employment rates continued to decline among all education levels for Aboriginal core-aged workers, with the largest declines occurring among those who had completed post-secondary education and those who had less than high school education. Among non-Aboriginal people, employment rates increased slightly among graduates and non-graduates of high school.

1.4  Youths

1.4.1  Labour market also difficult for youths, particularly in Quebec, Manitoba and Alberta

This section examines the labour market participation among youths, that is, those aged 15 to 24 years. Since varying school attendance rates will have an impact on the labour market participation for young people, it is important to consider these rates when analyzing the data. In 2010, 45% of Aboriginal youths were attending school compared to 51% of non-Aboriginal youths. Participation rates may differ between the groups based on school attendance and the age at which education is completed.

In the past, Aboriginal youths have been less likely to participate in the labour market than non-Aboriginal youths. In 2010, 57.0% of the Aboriginal population aged 15 to 24 years were either employed or looking for work compared to 64.8% of non-Aboriginal youths (Table 6). Among Aboriginal youths, First Nations youth living off-reserve were less likely to be participating in the labour market than Métis youths – 50.1% versus 63.3%.

Young people were particularly hard hit by the 2008/2009 economic downturn and this continued into 2010. Participation rates fell between 2008 and 2010 among youths, but more so among Aboriginal than non-Aboriginal youths. From 2008 to 2010, the participation rate of Aboriginal young people declined by 5.0 percentage points compared to a loss of 2.9 points for non-Aboriginal youths. First Nations youths living off-reserve had larger losses than their Métis counterparts (-6.5 versus -4.2 points).

Participation rates fell in all provinces for both the Aboriginal and non-Aboriginal youths from 2008 to 2010. Among Aboriginal youths, participation rate declines were steepest in Quebec, Manitoba and Alberta (Table 7) while the Atlantic region had the smallest decline. Among non-Aboriginal young people, there were above average declines in Alberta, British Columbia, Ontario and Manitoba during this two-year period, with smaller declines in the Atlantic region and Quebec.

The highest rate of labour market participation for Aboriginal youths in 2010 was in Alberta (60.6%) and in the Atlantic region (59.6%). Among non-Aboriginal youths, the highest rate was in Saskatchewan (70.7%), Manitoba (70.4%) and Alberta (69.7%).

As fewer Aboriginal youths participated in the labour market in 2010, more attended school. The school attendance rate among Aboriginal young people rose from 42% in 2008 to 45% in 2010. The largest increases during this period were in Ontario, Quebec and Alberta. School attendance also increased among non-Aboriginal young people during this period, from 49% to 51%, with the largest increases in the same provinces.

1.5  Declines among Aboriginal older workers in 2010

Not only were there fewer Aboriginal youths and core-aged workers participating in the labour market in 2010, there were also fewer people aged 55 and over participating. After increasing in each of 2007, 2008 and 2009, rates of participation declined in 2010 among older Aboriginal workers. This was in contrast to non-Aboriginal workers aged 55 and over, whose participation rate continued to increase throughout the 2007 to 2010 period.

All of the decline in the participation rate among Aboriginal older workers was due to decreased participation among those who identified as First Nations people. Between 2008 and 2010, the participation rate among First Nations people aged 55 and over and living off-reserve declined 6.0 percentage points to 30.1%. In contrast, participation rates increased among the Métis to 38.5% (+3.0 points) and among the non-Aboriginal population, to 36.0% (+1.7 points) (Chart 13).

The largest declines in the participation rates among Aboriginal older workers were in Ontario and British Columbia between 2008 and 2010. On the other hand, participation rates increased in Alberta during the same period, reaching 46.7% in 2010 (Table 8).

Alberta and British Columbia had the highest percentages of Aboriginal older workers participating in the labour market in 2010, higher than their non-Aboriginal counterparts.

1.6  Conclusion

The 2008-2009 labour market downturn had a longer and deeper impact on the Aboriginal workforce compared to non-Aboriginal workers. This widened the gap in the rates of participation, employment and unemployment between both populations.

As employment among Aboriginal people continued to decline in 2010, fewer Aboriginal people participated in the labour market. In 2010, 62.6% of the Aboriginal working-age population participated in the labour market compared with 67.1% of the non-Aboriginal population – a gap of 4.5 percentage points. This was the largest gap observed between these two groups over the four-year period that comparable data has been available.

Between 2008 and 2010, the employment rate fell the most among Aboriginal core-aged workers in Quebec, British Columbia, Ontario and Alberta. Employment rates among Aboriginal core-aged workers in Quebec and British Columbia were the lowest nationally in 2010, at 61.1% and 62.7%, respectively.

The decline in manufacturing employment associated with the 2008 downturn affected both Aboriginal and non-Aboriginal people, as this industry posted the sharpest decline in employment for both groups of between 2008 and 2010. Trades, transport and equipment operators; sales and service workers; occupations unique to processing, manufacturing and utilities; as well as management occupations experienced the greatest job losses among these core-aged workers.

Employment declined for both Aboriginal and non-Aboriginal core-aged people in the private sector, among employees and the self-employed. Among Aboriginal people, a higher percentage took on more than one job in 2010 than in 2008 and more were in a temporary job than among the non-Aboriginal population. Both groups, however, were working fewer hours over this two-year period.

Employment rates fell across all education levels for both core-aged Aboriginal and non-Aboriginal workers between 2008 and 2010.

Youths were particularly hard hit by the 2008/2009 economic downturn and this continued into 2010. Participation rates continued to fall among both Aboriginal and non-Aboriginal youths from 2008 to 2010, but more so among Aboriginal youths. Young Aboriginal people in Quebec, Manitoba and Alberta had the largest decline in their participation rates. More of these youths, however, were attending school during this period. Ontario, Quebec and Alberta had the largest increase in their school attendance rate.

While an increasing proportion of Aboriginal workers aged 55 and over participated in the labour market from 2007 to 2009, fewer participated in 2010. This was in contrast to non-Aboriginal older workers, whose participated rate increased throughout the 2007 to 2010 period. Among the older Aboriginal population, the 2010 decline in the participation rate was concentrated among First Nations people living off-reserve.

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