6 Conclusion
The results of the current study provide strong evidence on the contribution of educational attainment to the income gap, and its increase between 1986 and 1996.
This period has experienced major changes in the New Zealand economy leading to higher demand for skills. Given that a large proportion of the Maori population had left school without qualifications and was engaged in elementary occupations, Maori males, in particular, faced barriers in responding to the increased demand in high skill occupations. At the same time, elementary and low skilled jobs did not experience growth to the extent that professional and other skill-based occupations have in the decade. A related finding is the evidence that educational effects on differences in income have partly been mediated through differences in access to hours of work per week.
An important finding is that, while there are significant differences in educational attainment and occupations of Maori and Non-Maori groups, once educational attainment is controlled for, much of the gap in occupational status disappears – particularly in 1996. As a result, the income gap at the higher education levels has narrowed over the period.
The results also show that, other things being equal, Maori in rural areas face particular disadvantages. Further investigation of the reasons for this, and the possibilities for advanced education and employment outside of the urban and semi urban areas is therefore important. Conversely, the relative success of employed Maori residing in semi-urban areas, and further examination of the reasons for it is also of special interest.
The decomposition results highlight the importance of ‘characteristics’, such as education, hours of work and occupation, rather than differential returns to higher skills by ethnicity in explaining the widened income gap. Indeed, returns to educational investments for Maori were higher at every level of education. An implication is that for Maori without school qualifications there is a greater relative opportunity cost of not pursuing post-compulsory education. Consistent with this, Maori participation in post-compulsory education increased over the period. Nevertheless, the Maori population, which had a large proportion without school qualifications, was in a disadvantaged position and did not attain tertiary educational levels similar to the rest of the population.
The results of this study suggest that investing in higher education provides important options for the Maori population in reducing the income gap. This is supported by the findings throughout the study that the income gap based on educational attainment within the ethnic group is far greater than the income gap across the ethnic groups and when controlling for educational attainment.
Thus, it is of concern that in the past, and currently the Maori population has not and does not acquire school qualifications at the same rate as others. The results of the current study suggest that this should be a particular focus for further research and policy development.
