PUBLICATIONS

Is wage inequality driven by disparities in pay within firms or is it driven by pay disparities between firms? It turns out that both of these factors can contribute to inequality. Using longitudinal Canadian tax data from 1991 to 2019, we found evidence of increasing earnings inequality which has been predominantly driven by the top 20% of the largest firms. Inequality in pay within firms accounts for about two-thirds of the measured inequality but the rise in inequality over time has been driven by pay disparities between firms.

What proportion of your income do you think you pay in taxes? In 2017, Canadians, on average, paid about 12% of their income on federal, provincial and federal payroll taxes (which are the major tax sources for average Canadians). The top 1% of Canadians paid about 31% of their income on such taxes.  However, tax filers with similar income profiles can end up paying vastly different amounts in taxes depending on their individual mixture of income sources since income sources are not taxed at uniform rates. Of the top 1% of Canadian tax filers, 5% had an effective tax rate below 6% while 5% had an effective tax rate above 45%.  Between 1992 and 2017, a fifth of Canadians did not pay any federal, provincial, or federal payroll taxes. When government transfers are accounted for, we observe that the bottom half of the distribution ends up with negative net effective tax rates meaning their transfers received exceeded their taxes paid. The top half of the distribution ends up with positive net effective rates indicating that they paid more in taxes than they received in transfers. Note that this study does not account for property or commodity taxes.

Although a wide array of stochastic dominance tests exist for poverty measurement and identification, they assume the income distributions have independent poverty lines or a common absolute (fixed) poverty line. We propose a stochastic dominance test for comparing income distributions up to a common relative poverty line (i.e., some fraction of the pooled median). A Monte Carlo study demonstrates its superior performance over existing methods in terms of power. The test is then applied to some Canadian household survey data for illustration. 

The quality of a job depends on more than just how much you make. This paper examines multidimensional aspects of job quality in Canada using six broad dimensions of job quality: income and benefits, career prospects, work intensity, working-time quality, skills and discretion, and social environment. Results from both descriptive and latent class analysis reveal a great deal of variation in job quality across sectors and socio-demographic groups. Results show that some of the largest labour market segments, such as hospitality and personal services, are associated with many negative job features. Moreover, workers in atypical contracts or part-time employment also experience many disadvantages in the workplace other than being low-paid. 

The OECD Better Life Index is a composite indicator for measuring socio-economic well-being of its member countries. But the index varies substantially depending on how the dimensions are weighted. Stochastic dominance efficiency is employed to determine the most optimistic and pessimistic weighting combinations to check the sensitivity of the index. Based on those weighting schemes, we offer alternative rankings of countries across dimensions. Countries with balanced achievements across dimensions generally remained stable in their relative rank.

We measure global performance when it comes to child development outcomes based on Save the Children UK’s Child Development Index, a composite measure comprising health, education, and nutrition. We rely on consistent tests of stochastic dominance efficiency to derive the most optimistic and pessimistic scenarios for measured child development. This approach presents an opportunity to study the sensitivity of the Child Development Index and allows us to better understand the aspects of child development by offering a glimpse into the index components most responsible for driving or hindering improvements in measured child development across countries. We find that in the most optimistic scenario for measured child development, increasing the weight attached to the education dimension over time allows more countries to achieve better measured outcomes. On the other hand, shifting majority of the weight towards health results in the most pessimistic scenario. These results indicate that improvements in children’s education outcomes have outpaced health and nutrition. That is, relative to health and nutrition, more countries find it easier to achieve better education outcomes. 

Relative poverty lines are increasingly being used in poverty comparison studies. Existing methods assume that the distributions being compared are distinct with independent relative poverty lines. However, this practice may be problematic when comparing two subgroups of a population. We follow up on a recent proposal for the usage of common relative poverty lines in such cases, and develop a test for comparing poverty between subgroups of a single population, using inequality restrictions. Monte Carlo experiments are conducted in order to examine the size and power of our proposed test. We illustrate our procedure using some U.S. household income data. 

We propose an empirical likelihood-based method of inference for comparing inequality between two populations. Empirical likelihood requires only a minimal set of assumptions and does not require the derivation of complex variance structures.  A series of Monte Carlo experiments are used to assess our method’s finite sample performance. We illustrate our approach using some Canadian household income data. 

A growing body of literature is emerging on empirical likelihood methods for complex surveys. These works largely focus on the population mean. We propose a weighted empirical likelihood approach as a method of inference for quantiles under stratified random sampling, which is one of the most popular complex survey designs. A simulation study substantiates our proposed methodology. 

The transition towards a net-zero economy could impact workers in high-emission industries. A collaborative study with the OECD found that layoffs carry a greater financial cost for workers in these industries whether it be Canada or other OECD countries.

Trade tensions beginning in 2025 between Canada and its largest trading partner--the U.S.--have raised concerns about the possibility of layoffs in Canadian industries dependent on American demand. A first article "Job quality in industries dependent on United States demand for Canadian exports" examined the quality of jobs in these industries. This article examines the socioeconomic composition of the workforce in these industries which may play a role in how affected workers adapt to potential job losses. This article finds that men, older workers, and less educated workers are more likely than their counterparts to be employed in industries depended on American demand.

While it is challenging to predict the number of jobs in Canada that could be impacted by U.S. tariffs, it is still possible to describe the quality of such jobs which this study does. Workers in industries vulnerable to U.S. tariffs tend to be in generally high quality jobs. These jobs are more likely to be permanent full-time and covered by employer-sponsored pension plans. However, there is substantial variation across the specific subsectors.

This paper provides a comprehensive analysis of the costs of job displacement in energy-intensive industries in selected OECD countries. Based on harmonised linked employer-employee data from 14 OECD countries, we estimate the effect of job displacement in three energy-intensive industries, namely energy supply, heavy manufacturing and transport, compared to other industries. We find that workers displaced from the energy supply and heavy manufacturing, experience larger earnings losses compared with workers in non-energy-intensive and transport sectors. Larger earnings losses mainly result from weaker re-employment outcomes in terms of wages and job instability but also challenges with finding another job. They reflect significant differences in the composition of workers and firms in energy supply and heavy manufacturing and the rest of the economy. Displaced workers in these sectors tend to be older, are less skilled and more likely to be previously employed in high-wage firms.

Around 60% of the Canadian workforce could be in jobs highly exposed to AI but about half of them might benefit from the new technologies. Unlike previous waves of technological transformation such as automation which mostly affects less educated and lower-earning workers who perform simple, routine and non-cognitive tasks, AI is more likely to affect highly educated and higher-earning workers given AI's growing capability to perform complex, non-routine and cognitive tasks .

Around 60% of the Canadian workforce could be in jobs highly exposed to AI but about half of them might benefit from the new technologies. Unlike previous waves of technological transformation such as automation which mostly affects less educated and lower-earning workers who perform simple, routine and non-cognitive tasks, AI is more likely to affect highly educated and higher-earning workers given AI's growing capability to perform complex, non-routine and cognitive tasks .

It is commonly perceived that the Canadian immigration system supplies mainly higher-skilled labour. However, immigrants in Canada provide almost as much lower-skilled labour (35%) as they do higher-skilled labour (40%). Immigrants are two to five times more likely than Canadian-born workers to be in ICT and engineering professions. Immigrants (3%) are less likely than Canadian-born (6%) workers to be employed in industrial, electrical and construction trades. The occupational distribution differences between immigrants and Canadian-born workers are long-standing dating back to at least 2010. One of the main goals of Canada's immigration system is to "fill labour and skills shortages" but the effectiveness of this approach is debatable. As immigrants enter Canada, they interact with the economy by working and consuming goods and services, which might alter the underlying labour market dynamics and even exacerbate existing labour challenges. Past "labour shortages" is a poor predictor of future challenges.

The COVID-19 pandemic has triggered massive societal and economic changes. One of the key labour market changes brought on by the pandemic is the increase in work from home (WFH) which has become an important aspect of job quality for many workers. WFH has also had unintended consequences on local economies such as the reduction in revenues of restaurants located in city centers which relied on commuters before the pandemic. This study finds that in Canada, from 2020 to 2022, a 1 percentage point increase in the incidence of WFH was associated with a 0.55% reduction in restaurant revenues. However, the degree to which WFH may have led to spatial reallocation of demand for restaurants from city centers to near the homes of teleworkers remains an open question.

This study assesses the degree to which immigrant couples who landed in Canada with young children from 2016 to 2019 received the Canada child benefit (CCB) in the year following landing. The study shows that newly landed permanent resident couples with some employment income in the year following landing were much more likely than other permanent resident couples to receive the CCB that year. Newly landed couples without employment income but with a T1 income tax form filed by a spouse were less likely to receive the CCB than their counterparts with employment income, but their CCB take-up rate was markedly higher than that of couples with no T1 or T4 records. Compositional effects do not explain these differences. The study also shows that if non-recipient families with no employment income had received the CCB, their low-income rates would have fallen by 1 to 2 percentage points, from a baseline rate of 61%. 

The increase in remote work triggered by the COVID-19 pandemic has reduced the number of urban public transit commuters in Canada. The proportion of urban commuters using public transit fell from 14.8% in 2016 to 9.3% in 2021 and rebounded partly afterward to 11.8% in 2023. The increase in remote work appears to have reduced the number of urban public transit commuters by 290,000 to 780,000 depending on different hypothetical scenarios, contributing substantially to the drop in urban public transit ridership since 2019 and to the deficits experienced by several public transit authorities since then. The fact that several public transit authorities have experienced deficits in recent years is not unique to Canada. 

Income tax filing is a prerequisite for accessing many government benefits in Canada. Benefits like the Canada child benefit can prove to be crucial income sources for new immigrants who arrive with little financial resources. This study examines the evolution of income tax-filing patterns in Canada for immigrant landing cohorts from 1993 to 2019. Filing rates have improved from 83% for the 1993-1996 landing cohort to close to 90% for the 2017-2019 landing cohort. Refugees, with filing rates of 95% of higher, were more likely to file an income tax return than any other admission class.

How are Canadian retirees doing? Have their living standards improved over time? This study follows several cohorts of tax filers as they age from their mid 50s to late 70s and finds that incomes have indeed improved for more recent cohorts but the extent of those improvements depend on where in the income distribution you were prior to retiring. The Old Age Security (OAS) / Guaranteed Income Supplement (GIS) have played a key role in stabilizing incomes at the bottom of the distribution while registered retirement savings plans (RRSPs) and registered pension plans (RPPs) have become important income sources for the middle and top of the distribution.

What effect does spousal death or divorce have on retirement income? Following the income trajectories of several cohorts of tax filers from their mid 50s to late 70s, this article compares financial outcomes of individuals across marital profiles and finds that recent cohorts of divorcees and widows are, in fact, doing somewhat better than their earlier counterparts but the extent of the improvements in living standards vary across the income distribution.

Increased feasibility of remote work raises questions surrounding promotion and wage growth of remote employees. This study compares wages of Canadians from 2005 and 2015 and finds that remote employees experienced lower wage growth than other workers. However, remote employees were already earning more than other employees. 

Canadian employers expect about 112,700 (0.85%) of their employees to work remotely from another province/territory over the first quarter of 2022 - this represents 4% of all expected teleworkers. For comparison, in 2016, 12,600 (0.15%) employees teleworked from another province/territory, and in 2001, 3,500 employees did so. Employees most likely to telework for an employer in another province/territory tend to be highly educated and often work in high-knowledge industries. They also average substantially higher wages than other teleworkers. 

Since the beginning of the COVID-19 pandemic, Statistics Canada has produced several studies on working from home. This article synthesizes the key findings of these studies, provides an international perspective and identifies questions for future research. 

Results indicate that once the COVID-19 pandemic is over, Canadian employees might prefer working around 24% of their hours from home. In 2016 and 2018, employees worked no more than 5% of their total hours from home. Therefore, the overall share of total hours that employees might prefer working from home once the pandemic ends equals almost five times the overall share of total hours they worked from home prior to COVID-19. 

COVID-19 has led to a significant increase in telework since mid-March 2020. At the beginning of 2021, 32% of Canadian employees aged 15 to 69 worked most of their hours from home, compared with only 4% in 2016. This study finds that among new Canadian teleworkers aged 15 to 64, who usually worked outside the home prior to COVID-19 but worked most of their hours at home during the week of February 14 to 20, 2021, 90% reported being at least as productive as before the pandemic, and 80% would like to work at least half of their hours from home once the pandemic is over. Additional data available here.

This study integrates weekly earnings available from the Canadian Labour Force Survey together with information specific to government transfers including special COVID-19 benefits collected through administrative data sources and imputation. The objective is to shed light on the impact of labour market disruptions on Canadians and their families and the extent to which emergency benefits introduced by the government offset these disruptions. 

Consistent tests of stochastic dominance efficiency are used to assess the Global Gender Gap Index which is a composite gender gap measure comprising 4 equally weighted dimensions-economic participation & opportunity, educational attainment, health & survival, and political empowerment. Country rankings and index scores vary considerably depending on the choice of dimensional weights. The aim of this article is to use stochastic dominance efficiency in order to examine two extreme scenarios-a best-case scenario where more countries achieve better measured outcomes and a worst-case scenario where more countries achieve poorer measured outcomes. Shifting more weight towards educational attainment, and health & survival induces the best-case scenario. On the other hand, weighting political empowerment, and economic participation & opportunity more heavily induces the worst-case scenario. In 2018, 68% of the official (equally-weighted) measured gender gap was closed. Under the most optimistic weighting scheme, 90% of the gap closes. And under the most pessimistic weighted scheme, 34% of the gap closes. 

In 2018, Statistics Canada released two new data tables with estimates of effective tax and transfer rates for individual tax filers and census families. These estimates are derived from the Longitudinal Administrative Databank. This publication provides a detailed description of the methods used to derive the estimates of effective tax and transfer rates. 

This is the working version of the research article with the same title which appears in Canadian Public Policy.

This Census in Brief examines household contributions to registered retirement savings plans (RRSPs), registered pension plans (RPPs), and tax-free savings accounts (TFSAs) in 2015. Contribution patterns are analyzed by age, income, and region to provide some insight into the savings behaviour of Canadian households.  On average, 35% of households contributed to RRSPs, 30% contributed to RPPs, and 40% contributed to TFSAs. Around 9% of households contributed to all three types of accounts.