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December 2005
Vol. 6, no. 12

Perspectives on Labour and Income

Education and income of lone parents
Diane Galarneau

Between 1981 and 2001, the proportion of lone parent families went from 11% to 16%. These families also accounted for more children 18 and under in 2001—21% compared with 14% in 1981. Being a parent is not easy, and heads of lone-parent families face the same challenges as other parents but often with less financial resources. In 2000, the before-tax annual income of two-parent families was nearly $78,800, compared with only $27,700 for lone mothers and just under $44,000 for lone fathers.1

While lone mothers in 2000 were almost five times more likely to have a low income than mothers with spouses (43% versus 8%), the proportion was lower than in 1980 (52%). However, improvements were not observed for all age groups or education levels. And, among lone fathers, who represent a growing portion of heads of lone-parent families, low income increased, going from 16% to 20%. For them also, the pattern was not uniform. Even though their low-income rate was half the rate for lone mothers, it was more than double that for fathers with spouses (8%).

Low income has a major impact on many aspects of life, including well-being, work, friendships, health, and even longevity and crime. It is also likely to influence the future of children in affected families, reducing their chances of going on to postsecondary education (Acemoglu and Pischke 2001). This in turn may limit their future earnings potential and with it their chances of escaping from low income.

Using the 1981 and 2001 Censuses, this article examines changes in the characteristics of lone parents. It looks at their earnings and the proportion in low income by age group and education level, and compares them with parents living in a couple relationship. Changes in low-income rates for full-time, full-year workers are also examined (see Data source and definitions).

Women heading lone-parent families

A phenomenal increase in educational attainment
The increase in lone-parent families has led to a sizeable rise in the number of lone mothers since 1981. In 1981, there were 330,000 lone mothers aged 25 to 54 with children aged 18 or under, compared with 555,000 in 2001, an increase of 68%. In comparison, the number of mothers in couple relationships rose 3% to 2,788,000 (Table 1).

The profile of mothers changed greatly during this period. Like the rest of the population, they were slightly older than in 1981. The average age of lone mothers rose 0.9 years compared with 1.8 for mothers with spouses. In addition to general population aging, other factors probably contributed to the aging of mothers. These include the later entry of women into conjugal relationships and having a first child later in life (Zukewich and Cooke-Reynolds 2003). Lone mothers had fewer children than mothers in couple relationships, although the average declined for both groups. Lone mothers were still more likely to have only one child (half compared with one-third for women in couple relationships), and large families were less common in 2001 for both groups.

One of the most marked changes was women's educational attainment. In 1981, 46% of lone mothers (compared with 42% of those with spouses) had not completed high school. By 2001, this proportion had fallen by more than half to 22% (17% for mothers in couple relationships), mainly in favour of high school completion and university education. A majority of all mothers had studied at the postsecondary level, in both 1981 and 2001. But overall, lone mothers had less education than mothers with spouses in 2001.

To a large extent, these trends were observed in all age groups. However, the increase in educational attainment was less pronounced for lone mothers aged 25 to 34. In 1981, they had a higher education level than older lone mothers, whereas in 2001, they were substantially behind: more than one-quarter had not yet completed high school and only 6% had a university degree.

This slower advance changed the relative situation of young lone mothers, who had now lost their educational advantage. Moreover, a sizeable gap is evident between them and their counterparts in couple relationships, for whom the proportion of university graduates (18%) was three times higher in 2001. The gap was also sizeable for those aged 35 to 44 years, but it narrowed among those 45 to 54.

These educational gaps between lone mothers and those in couple relationships could be explained by the young age of lone mothers when they had their first child.4 Also, most in 2001 (61%) had never been married,5 and may have taken care of their children without the presence or support of a spouse. These two factors may have been decisive in determining whether to continue their education. Nevertheless, given the narrowing of the education gap with age, one cannot rule out the possibility that young lone mothers may eventually catch up.

The opposite is observed for the oldest group (45 to 54). In 2001, both lone mothers and those with spouses had the largest proportion of university graduates and the lowest proportion of women with no high school diploma. Being older, the women in this group had had more time to pursue their education, but the phenomenal increase in their education level might also mask a cohort effect. The increase more likely reflects the greater value placed on education by those at the beginning of the baby-boom generation, born between 1947 and 1956 (aged 45 to 54 in 2001), compared with the cohort born between 1927 and 1936 (45 to 54 in 1981).

Employment rate up, but the youngest trail behind
This increased education level is coupled with an equally substantial increase in the proportion of women classified as employed or employed mainly full time, especially among mothers in couple relationships since their attachment to the labour market was weaker in 1981. In 2001, 71% of lone mothers and 75% of mothers in couple relationships had a job, and for most, a full-time one.

However, the youngest (25 to 34) trailed their older counterparts, both in their employment rate in 2001 and the progress observed with respect to it over the 20 years (Chart A). In 2001, 61% had a job, compared with 77% of their counterparts aged 45 to 54. In 1981, the percentages were 55% and 56% respectively.

Also, a smaller proportion of these young lone mothers worked full-time, or full-time for the full year (Chart B), and the increase was less than for their older counterparts.

The unemployment rate for lone mothers rose slightly, from 9.3% in 1981 to 10.0% in 2001 (Chart C), while the rate for mothers in couples fell from 7.7% to 5.4%. The unemployment rate increased more for the youngest lone mothers with little education (from 16.2% to 21.6%) and for all lone mothers with little education (from 11.7% to 16.2%). According to a recent longitudinal study, lone mothers have a greater risk of being chronically unemployed (Brooks 2005).

Annual employment earnings higher but the increase was not uniform
Income generally rises with age and education. Given lone mothers' increased participation in the labour market, their aging, and the major increase in their educational attainment since 1980, one would expect an increase in their employment earnings—and this in fact happened. Their annual earnings rose 35%6 in real terms between 1980 and 2000, going from $14,700 to $19,9007 (Table 2).

However, the increase was not universal. In particular, the youngest group registered sizeable losses for most education levels. This decline in earnings may be attributed to various factors, including the loss of their educational advantage and the rise in their unemployment rate. Their low employment rate and the small proportion working full time, or full time for the full year, also played a part. In addition, jobs held by young lone mothers in 2001 were less likely to require specific skills. Just over 54% had a job requiring at most a high school diploma, compared with 47% and 40% of their counterparts aged 35 to 44 and 45 to 54 respectively (Chart D). Also, temporary jobs, which are generally less well-paid than permanent ones, are more likely to be held by women, youths, and persons with little education (Galarneau 2005). This type of work may thus be more common among young lone mothers with little education.

The lower employment rate for young lone mothers and their stronger inclination toward part-time work compared with older lone mothers may be partly explained by their being young and having small children. Large gaps were also evident between young lone mothers and their counterparts in couple relationships. However, on average, they had fewer children and their youngest child was older. Being young when their first child was born and not having the support of a spouse may have been determining factors for many in deciding whether to continue their studies—25% did not have a secondary school diploma in 2001. Lack of education probably had a large influence on their labour market performance as well as their earnings. These factors may have affected all lone mothers with little education. In a knowledge economy, where employers increasingly require specific skills and where the number of highly qualified persons is mounting, young people with little education are inevitably disadvantaged.

As for mothers in couple relationships, their earnings reached $22,700 in 2000, up 104% from 1980, or three times the growth for lone mothers. This may be partly due to the lower earnings of mothers in couple relationships in 1980, which was in turn attributable to their weak attachment to the labour market. When this attachment subsequently strengthened, the trends were reversed, with mothers in couple relationships then having, on average, higher earnings than lone mothers.

Worsening situation of young lone mothers confirmed by low-income rates
The improvement in employment earnings resulted in a decrease in the low-income rate for lone mothers. The rate went from 52% to 43% between 1980 and 2000, with older and relatively educated women being the main beneficiaries.

Young lone mothers (apart from university graduates) generally saw their low-income rate deteriorate. Note that these rates were already disproportionate in 1980 (Table 3). However, the rate declined with education level. In 2000, 75% of those without a high school diploma were in low income; the proportion fell to 62% for those with a high school diploma, and to 54% for those with non-university postsecondary education. For university graduates, the rate was 31%.

In general, the low-income rate for lone mothers in other age groups has declined since 1980, except for those who did not complete high school. The rate for these women aged 35 to 44 and 45 to 54 reached 60% and 52% respectively in 2000.

The low-income indicator includes all sources of income. Low-income families depend more on government transfers, which did not increase sufficiently to compensate for their lower earnings (Picot, Morissette and Myles 2003). This probably partly explains the rise in low-income rates among lone mothers with little education.

In contrast, low-income situations were much less frequent among mothers in couple relationships. However, rates for those with less education, which were already high, increased.

Full-time work: better protection than 20 years ago?
Up to now, the focus has been on lone mothers without regard to their participation in the labour market. Clearly, holding a full-time job for the full year should lessen low-income situations. But does it offer better protection than 20 years ago?

In 2000, 40% of lone mothers worked mainly full time (that is, at least 30 hours per week) for at least 48 weeks. This proportion was up from 1980, when it stood at 32%.

When lone mothers working full time for the full year are compared with those not in the labour market or those with a different work pattern, it is not surprising to find that the former find themselves in low income much less often. In 2000, 14% of lone mothers working full time for the full year had a low income, compared with 62% of those with a different work pattern or not in the labour market (Chart E). Generally speaking, without taking into account age, education, occupation, industry or other characteristics, full-time work for the full year seems to mitigate against low income. However, it appears to do so less than 20 years earlier, especially for the youngest women with less education. Among them, the proportion with a low income went from 23% to 37%. Similarly, for those with the least education in the older groups, the rate rose 7 percentage points, reaching 26% for those 35 to 44 and 20% for those 45 to 54 (Table 4).

It is important to distinguish between low earnings and low income. Persons are considered working poor if they make a substantial work effort (such as working full time for the full year) but are low-paid. In fact, relatively few low-paid workers are in low income,8 since the earnings of other household members prevent it. Low income depends more on family circumstances than on an individual's employment situation (Fleury and Fortin 2004). Lone mothers with children 18 and under, even if they work full time throughout the year, have little chance of making ends meet without the contribution of a supplementary income. For this reason, a larger proportion of them compared with mothers with spouses were in low income (43% versus 8%), even when they worked full time throughout the year (14% versus 3%).

Full-time work is not a panacea, especially in the case of the youngest and least educated. For them, earnings from employment may turn out to be inadequate after taking into account employment-related expenses (such as childcare, transportation, extra expenditures on clothing and meals) and the loss of certain government benefits. This probably explains in part the youngest mothers' low level of participation in the labour market and the few changes that have occurred since 1981.

Men heading lone-parent families

A growing number
The increase in lone-parent families has meant an increase not only in lone mothers, but also lone fathers. The latter have almost doubled since 1981, from just over 62,000 to nearly 119,000. In comparison, the number of fathers with spouses held steady at around 2.7 million. Despite this substantial increase, the proportion of male lone-parent families grew only slightly, from 17.4% to 18.6%.9 However, the phenomenon cannot be described as marginal since they account for approximately one lone-parent family in six (Table 5).

The average age of lone fathers increased only slightly in 20 years (from 41.6 to 41.8), while the age of fathers in couple relationships increased by two years (from 38.3 to 40.4).10 As a result, the gap between the two groups narrowed. Lone fathers had fewer children (1.5 compared with 1.9), down slightly from 1981. Lone fathers often had only one child, and large families were less common for both groups.

Lone fathers, like lone mothers, have advanced considerably in their educational attainment since 1981. However, compared with fathers in couple relationships, slightly fewer held a university degree and slightly more had not completed high school. Also, on this score, the youngest lone fathers were somewhat behind lone fathers in the older age groups.

A deterioration in employment earnings
Overall, lone fathers saw their average earnings decline 7.3% in real terms since 1980, going from $41,000 to $38,000 (Table 6).11 This contrasts with lone mothers, who registered a significant (but not uniform) increase in earnings. However, the decrease was larger for younger and less educated lone fathers—similar to the situation of young lone mothers. Lone fathers aged 25 to 34 posted declines ranging between 28% and 13%. Various other subgroups also posted substantial decreases. For their part, fathers in couples saw earnings rise by a modest 5%; however, the youngest and least educated among them registered sizeable decreases.

These results are consistent with other studies showing that the employment earnings of low-educated young men have fallen since 1980 (Morissette, Ostrovsky and Picot 2004; Morissette and Johnson 2004; Beaudry and Green 2000; Burbidge, Magee and Robb 2002). This drop is attributable to various factors, including young men's loss of educational adva