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Canadian-born Chinese and South Asian people tend to earn more on average than their white counterparts in the long run, according to a new study by Statistics Canada.

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People from these two ethnic groups are more likely to have higher education levels with degrees in science, mathematics, engineering and technology (STEM), live in more expensive cities such as Toronto or Vancouver, work in high-wage industries and experience fewer layoffs compared to white people, the agency said.

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However, the comparison doesn’t hold true when researchers compare “apples to apples” or when they look at the conditional earnings of people over a long period.

“When you compare people with similar socioeconomic characteristics, such as education, job, illness, etc., then we find that all the groups, except for Chinese women, earned less than Canadian-born white individuals,” Aneta Bonikowska, one of the study’s authors, said.

As an example, she said Chinese men would earn less than white workers if she looked specifically at bachelor degree holders.

Statistics Canada looked at the earnings of about 925,000 Canadian-born individuals aged 25 to 34 over a period of 20 years by analyzing their tax records and 1996 and 2001 censuses. About 6,000 of the people were Chinese, 2,500 were South Asian and about 5,500 were Black. The remainder were white.

Similar trends were indicated in previous studies that focused on short-term earnings, but the long-term approach used this time provides unique insights into trends that are important for the economy, Bonikowska said.

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“Early on in life, you can’t necessarily tell for sure if some groups will see their earnings grow faster than other groups. You need longitudinal data to see those trends,” she said. “It could help us understand group differences and outcomes such as the likelihood of home ownership or people’s ability to buffer income shocks and differences between groups in retirement preparation.”

The report also said Black men had lower earnings over the 20 years compared to white men. Black and white women, though, had similar cumulative earnings.

One of the more “striking” differences the report noted is the difference in education levels between various groups.

At least 50 per cent of the Chinese men and women analyzed had a bachelor’s degree or higher education, with slightly lower shares observed among South Asian men and women. Only up to 25 per cent of Black and white men and women completed at least a bachelor’s degree.

Chinese and South Asian men and women were at least twice as likely as others to have a bachelor’s degree in a STEM field.

“Since higher education increases workers’ earnings and since graduates from STEM fields often earn relatively high earnings, these differences in education levels and fields of study are potentially an important driver of the earnings differences,” the report said.

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The report also said there was a “sizable difference” in workers’ initial place of residence. Black individuals were almost 30 per cent more likely than white people to live in Toronto, based on the initial observation period. Similarly, Chinese and South Asian individuals lived in Vancouver in far greater proportions than white people.

“If wages tend to be higher in Toronto and Vancouver than elsewhere, these differences in place of residence will tend to increase the cumulative earnings of Black, Chinese and South Asian individuals relative to those of their White counterparts,” the report said.

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