Tuesday, October 13, 2009

The Importance of Aboriginal Education

Throughout the month of October the Vital Signs Canada blog will feature guest bloggers who are experts on various aspects of community vitality. Today's contributor is Dr. Andrew Sharpe, Executive Director of the Centre for the Study of Living Standards.

Canada’s Aboriginal population is in crisis. In 2007, the National Council of Welfare concluded that, “To date, no governmental response has made major inroads into the issues” faced by Aboriginal people. Improving the social and economic well-being of the Aboriginal population is not only a moral imperative; it is a sound investment which will pay substantial dividends in the coming decades. Aboriginal education must be a key component in any such effort. 

In recognition of the educational challenges facing Canada’s aboriginal population, the Vital Signs initiative led by Community Foundations of Canada this year selected the aboriginal high school completion rate as one of the 10 core indicators to be used in the Vital Signs reports released by 16 community foundations across the county. The objective of this article is to highlight some of this key facts and issues related to aboriginal education, building on research that the Centre for the Study of Living Standards has conducted for Indian and Northern Affairs Canada (Sharpe et al, 2007 and Sharpe et  al, 2009).

The importance of the Aboriginal population for Canada and the Canadian economy is best exemplified by these key observations:
  • In 2006, the Aboriginal identity population made up 4.0 per cent of the Canadian population, with 1,311,200 persons.
  • The Aboriginal population is much younger than the average Canadian, with a median age in 2006 of only 26.5 years, compared to 39.5 years for all Canadians.
  • Aboriginal Canadians aged 15 and over have a much lower educational attainment than their non-Aboriginal counterparts with 43.7 per cent not holding any certificate, diploma or degree in 2006, compared to 23.1 per cent for other Canadians. 
  • As a result, the labour market outcomes for Aboriginal Canadians are significantly inferior to the Canadian average. In 2006, Aboriginal Canadians had lower incomes, a higher unemployment rate, a lower participation rate, and a lower employment rate. 
  • Aboriginal people with a high school diploma or higher had significantly better labour market outcomes, both in absolute terms and relative to non-Aboriginal Canadians than those who did not. 
  • In 2026, using the medium growth projection for Aboriginal and the General population, the Aboriginal population is projected to make up 4.6 per cent of the Canadian population.
Given these observations, Canada’s Aboriginal population could play a key role in mitigating the looming long term labour shortage caused by Canada’s ageing population and low birth rate. The potential contribution of the Aboriginal population to Canadian labour force and employment growth could be even larger than predicted by simple demographic trends because their participation and employment rates currently lag far behind the Canadian average. Indeed, if Aboriginal participation and employment rates reach 2006 non-Aboriginal levels by 2026, it is projected that the Aboriginal population will account for 19.9 per cent of labour force growth and 22.1 per cent of employment growth over the 2006-2026 period. In other words, if in 2026 Aboriginal people experienced the same labour market outcomes as non-Aboriginal people did in 2006, the Aboriginal share of the Aboriginal population to the Canadian labour force would nearly double by 2026. This equates to nearly 200,000 additional productive Canadian workers. Given that educational attainment is one of the key driver of participation and employment rates, there are clear incentives for the Canadian government to make Aboriginal education a priority. If in fact Aboriginal education were not prioritized, the drag on Canadian productivity caused by below average Aboriginal education will grow as the Aboriginal population’s share of Canada’s labour force increases over time.

CSLS research has concluded the following.
  • Education is by far the most important determinant of labour market outcomes, and also plays a preeminent role improving social outcomes.
  • Given the demographic structure of the Aboriginal and non-Aboriginal people, Aboriginal people will undoubtedly play a significant role in shaping the economic future of Canada, and in particular that of the Western provinces.
  • As a result, if businesses are to thrive in the environment of limited labour supply that is currently developing in Canada, they will need to integrate an increasing number of Aboriginal people into the labour force. If these individuals do not possess the necessary skills, businesses will suffer.
  • In addition, the long-term fiscal impact for governments of better education and better social outcomes for the Aboriginal population are massive. If government want to deal with looming fiscal issues, addressing the pressing needs of Aboriginal today may be part of the solution.
  • Finally, increased education can have dynamic effect on the leadership capacity of the Aboriginal community and therefore may underestimate the contribution of increased education of Aboriginal Canadians to future output and productivity growth. Better educated Aboriginal Canadians will be more effective leaders and thereby provide better direction for the economic development of Aboriginal communities.
Investing in disadvantaged children is one of the rare public policy with no equity-efficiency tradeoff. Increasing the number of Aboriginal Canadians who complete high school is a low-hanging fruit with far-reaching and considerable economic and social benefits for Canadians.

The key message is clear: investing in Aboriginal education will not only benefit the Aboriginal population itself, but will also benefit Canadian governments and businesses, and, by extension, the entire Canadian population. Increased output will drive up productivity which is the key driver of our standard of living. Furthermore, decreased government cost and increased government revenue will provide Canadian government with the fiscal flexibility needed to cut taxes, increase services or reduce debt.

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  1. AnonymousJanuary 23, 2010 at 1:11 AM

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