Journal of Rural Studies 72 (2019) 252–263

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Journal of Rural Studies

journal homepage: www.elsevier.com/locate/jrurstud

Location, location, location: Examining the rural-urban skills gap in Canada T

∗ 1 2
David Zarifa , Brad Seward , Roger Pizarro Milian
Nipissing University, 100 College Drive, Box 5002, North Bay, ON, P1B 8L7, Canada

A R T I C LE I N FO A B S T R A C T

Keywords: The elevated demands of the new knowledge economy pose particular challenges to rural and northern regions
Skills in Canada, long acknowledged by policymakers to suffer from acute human capital deficits. Rural residents
Rural obtain lower levels of education than their urban counterparts and those that do obtain post-secondary training
Literacy often migrate to urban regions offering abundant employment opportunities and higher wages. Despite an
Numeracy
emerging consensus around over skill deficits across rural regions, Canadian researchers have yet to system-
Longitudinal international study of adults
Brain drain
atically explore contemporary rural-urban differences in human capital using refined measures of literacy and
numeracy skills. We ameliorate this deficiency by mapping rural-urban disparities in skills across the working
age population (16–65) using Statistics Canada's 2012 Longitudinal International Study of Adults (LISA). Our
results indicate that residents from smaller population centers and rural areas within Canada show significantly
lower skills proficiencies. These differences across location of residence shrink considerably when controlling for
education level, underscoring the need to enhance post-secondary access in rural areas.

1. Introduction
In the concluding decades of the 20th century, Canada began to
transition from a resource to a knowledge-based economy (Baldwin and
Beckstead, 2003; O'Hogan & Cecil, 2007; Gera and Mang, 1998) – one
that is driven primarily by the “production, distribution and use of
knowledge and information” (OECD, 1996, p. 7). This evolution has
been enthusiastically encouraged by policymakers keen on trans-
forming Canada into a “Northern Tiger,” capable of competing with
international counterparts across lucrative high-tech industries (Policy
Horizons Government of Canada, 2010). Policymakers have sought to
foster Canadian competitiveness in these industries via a plethora of
initiatives designed to improve the domestic production, retention and
international recruitment of highly-skilled workers (Gera and
Songsakul, 2007; Head and Reis, 2004; Livingstone, 2012, 2018;
Metcalfe and Fenwick, 2009). In fact, by the year 2031, reports suggest
that roughly 70 to 80 percent of jobs in Canada will require some form
of post-secondary education (PSE), rendering skilled workers a vital
commodity (see Miner, 2010, 2012).
Some caution that skill “mismatches” are already emerging in the
Canadian labor market, as the human capital needs of the knowledge
economy outstrip the skillsets of an aging Canadian workforce (Stuckey
and Munro, 2013; Ontario Chamber of Commerce, 2012). Recent em-
ployer surveys show that approximately a third of Canadian businesses
experience difficulty hiring skilled workers (ManpowerGroup, 2016),
and more than half perceive skill shortages as a serious industry-level
problem (Business Council of Canada, 2018).3 Industry association
“white papers” have also lobbied for the revitalization of policy fra-
meworks associated with skills development, with a view towards al-
lowing domestic companies to successfully compete in global markets
(see Deloitte & HRPA, 2012). Even among critics of the skills “crisis”
narrative, there is a general acceptance that Canadian policymakers can
do much to improve the synchronization of workforce skills and dy-
namic labor market demands (Burleton et al., 2013).
The human capital demands of the new knowledge economy pose
particular challenges for rural and northern regions in Canada, who
have long suffered from acute skilled labor deficits (Beckley and
Reimer, 1999; Bollman et al., 1992; Bollman, 1999). Research finds that
rural residents aspire and obtain lower levels of education than their
urban counterparts, even after controlling for a host of socio-economic
factors at the individual and family levels (Finnie et al., 2015; Newbold
and Mark Brown, 2015). They are less likely to attend university, as
opposed to community college (Zarifa et al., 2018), and less likely to
enroll in university-level science, technology, engineering and

∗
Corresponding author.
E-mail address: davidz@nipissingu.ca (D. Zarifa).
1
This author is now a Visiting Researcher in the Department of Leadership, Higher and Adult Education, University of Toronto, Ontario, Canada.
2
This author is now at the Conference Board of Canada, Ontario, Canada.
3
See Cross (2014) and Borwein (2015) for reviews of employment surveys done in recent years.

https://doi.org/10.1016/j.jrurstud.2019.10.032
Received 29 October 2018; Received in revised form 19 August 2019; Accepted 8 October 2019
Available online 31 October 2019
0743-0167/ © 2019 Elsevier Ltd. All rights reserved.
D. Zarifa, et al.
mathematics (STEM) fields (Hango et al., 2018). Moreover, those that
do obtain post-secondary training in remote geographical areas often
migrate to urban regions, which offer a greater abundance of employ-
ment opportunities and higher wages, spurring a “brain drain” that
further augments rural-urban workforce skill disparities (Alasia, 2005;
Corbett, 2005; Malatest and Associates, 2002; Rothwell et al., 2002;
Tremblay, 2001). The skill shortages produced by these uneven mi-
gration flows hinder the economic development of many rural and
northern communities, especially those that sit on natural resources
(e.g. minerals, oil) whose extraction and processing requires a highly-
skilled workforce (Moazzami, 2015a). Perhaps unsurprisingly, reports
published by the Canadian Rural Revitalization Foundation (Lauzon
et al., 2015) have branded the reversal of the rural-urban “brain drain”
as a top development priority for rural communities.
Despite an emerging consensus over the intensive skill demands of
the new knowledge economy, and over skill deficits across northern and
rural regions, researchers have yet to empirically explore contemporary
rural-urban skill differences using refined measures of literacy and
numeracy proficiencies. Policy reports typically use proxies like edu-
cational attainment (e.g. Bollman, 1999; Moazzami, 2015a; 2015b) and
occupational categories (e.g. Alasia and Magnusson, 2005; Magnusson
and Alasia, 2004) to ascertain rural-urban imbalances in human capital
(Alasia, 2005). However, our review of the literature unearthed only
three examinations of the Canadian rural-urban skills gaps using refined
measures from the now discontinued International Adult Literacy
Survey (Corbeil, 2000; Green and Riddell, 2001; Willms, 1997) and the
Adult Literacy and Life Skills Survey (Green and Ridell, 2015).
Our present understanding of existing rural-urban skills disparities
is thus far from ideal, being based on imperfect proxies and outdated
data. This state of the literature impedes effective policymaking per-
taining to rural economic development. Through this study, we thus
seek to extend existing research by using data from Statistics Canada's
2012 Longitudinal International Study of Adults (LISA) to examine
rural-urban disparities in skills across the working age (16–65)
Canadian population. More specifically, we ask: to what extent do
urban and rural residents differ in their literacy and numeracy skills?
Since prior research has found that rural-urban disparities in educa-
tional attainment are partly explained by socio-economic character-
istics, we also examine to what extent factors like family income,
education, and/or employment characteristics explain these rural-
urban skills gaps.
2. Literature review
2.1. Human capital & skills in the labor market
The concept of human capital gained prominence within the field of
economics during the mid-20th century (see Becker, 1962; Mincer,
1958; Schultz, 1961, 1960). Since then, it has become central to aca-
demic and policy discussions of economic development. Human capital
theorists posit that participation in varied activities, ranging from
formal education to on-the-job training, provides skills that render in-
dividuals more productive (Becker, 2002). This, in turn, augments fi-
nancial returns on their labour, and also has positive effects on the
performance of the firms they work for and jurisdictions they inhabit
(Becker, 2002). The logic of human capital theory (HCT) has been
subject to repeated and varied criticism since its emergence. On the one
hand, studies have questioned the extent to which formal credentials
map directly on to the skill sets of degree- and diploma-holders, sug-
gesting a looser linkage between skills acquired and the formal cre-
dential conferred than assumed by HCT (e.g., Berg, 1970; Collins,
1979). Other theories underscore the structural barriers that dis-
advantaged groups (i.e., low SES, racial and ethnic minorities, rural
youth) face in their pursuit of human capital (e.g., Blaug, 1976; Bowles
and Gintis, 1976; England, 1982). As such, our study embraces these
criticisms by exploring skills disparities (as opposed to formal
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Journal of Rural Studies 72 (2019) 252–263
credentials) among rural populations.
Despite this litany of attacks, the perspective remains firmly en-
trenched in policy circles. Observers suggest we are living in an “age of
human capital” (Becker, 2002, p. 3), where the success of individuals,
firms and national economies are believed to be tied to investments in
people (Barro and Lee, 2001; Blundell et al., 2005; Wright and
Mcmahan, 2011; Heisz et al., 2015, 2016). Indeed, Canadian policy-
makers depict the creation of the “best-educated, most-skilled and most
flexible workforce in the world” as an economic imperative for the
nation (Department of Finance, 2006, p. 6). In 2018, the federal gov-
ernment invested $300 million into the establishment of a Future Skills
Center that will endeavour to identify looming skills needs within the
economy, and evaluate skills assessment and development strategies
(Government of Canada, 2019).
Still, attempts to use direct measures of skill in human capital re-
search are rare (Bills, 2003). With the exception of psychologists, who
have developed a battery of tests to measure intelligence (Jones and
Joel Schneider, 2006), social scientists typically rely on “proxies” of
human capital, such as years of education or credentials, which are only
rough approximations of a person's skills or productive capacity (Bills,
2016; Hanushek, 2013; Wright and Mcmahan, 2011). The usage of such
proxies, prompted by the costs associated with gathering more refined
measures of skill for large samples, can be problematic for two reasons.
First, though education and skills are positively correlated, they are not
synonymous. Recent research finds that the actual amount of learning
that takes place within education is much smaller than traditionally
believed (Arum and Roksa, 2011). There is also great heterogeneity in
the skillsets of individuals with credentials at similar tiers (e.g. BA,
MA), or an identical number of years of education (Hanushek, 2013;
Hanushek and Woessmann, 2010, 2012; Massing and Schneider, 2017a,
b). A number of other factors after graduation, such as on-the-job
training or community resources (e.g. libraries, cultural organizations,
news media), also drive skill disparities between individuals with si-
milar levels of attainment (Desjardins, 2003; Park and Kyei, 2011). As
such, education is far from a perfect indicator of human capital.
Second, scholars argue that studies employing education as a proxy
for human capital ignores qualitative distinctions between the “mul-
tiple dimensions of knowledge and skills” that individuals possess
(Desjardins and Albert, 2005, p. 361) – such as literacy, numeracy and
problem solving. There are also a variety of types of intelligence de-
veloped outside of schooling, such as emotional or cultural intelligence
(see Neisser et al., 1996), that are not effectively captured by education
proxies. As Barro and Lee (2001) note, education is “at best a proxy for
the component of the human capital stock obtained at schools” (p. 542).
By employing education as a proxy, we are sorting for a combination of
abilities and social dispositions which may facilitate educational at-
tainment (e.g. test taking, rule following/conformity), but may have
little or negative impact on productive capacities outside of the edu-
cation system. The sum of these limitations has driven researchers to
propose that education be supplanted within human capital research by
more finely-grained measures of specific skill, such as standardized test
scores (Bills, 2016).
2.2. The rural-urban human capital gap
Research has repeatedly found that individuals across remote re-
gions in Canada are less likely to enroll in PSE (Frenette, 2004, 2006;
2009a, b). It also finds that “distance deterrence” shapes their educa-
tional trajectories, and the type of post-secondary education they ac-
quire (Finnie et al., 2015; Newbold and Mark Brown, 2015; Zarifa et al.,
2018). Lower PSE participation rates among rural youth have also been
observed across European nations (see Dickerson and McIntosh, 2013;
Gibbons and Vignoles, 2012; Spiess and Wrohlich, 2010) and the
United States (Byun et al., 2012). These observed differentials in edu-
cational attainment are routinely cited during policy discussions of skill
disparities across Canadian regions (Alasia, 2005). They also inform
D. Zarifa, et al.
more sophisticated analyses. Moazzami (2015b), for example, devel-
oped a weighted index using educational attainment and income
measures (see p. 31–32) to map human capital disparities across regions
of Ontario, Canada. His analysis demonstrated that communal stocks of
human capital were positively correlated with population size. In a
second piece, Moazzami (2015a) used this same weighted index to
examine the dispersion of human capital across northern Ontario,
finding that in the north-east region of the province, stocks of human
capital were negatively correlated with rurality. However, in north-
west portion of the province, rural communities with weaker links to
urban centers possessed larger human capital index scores. This ap-
proach to measuring human capital has been employed repeatedly by
Cuddy and Moazzami (2017; 2017b) in a series of other reports ex-
amining skill deficiencies across different districts in northern Ontario.
An alternative, though seemingly less popular approach within the
literature, has been the use of occupational categories as a proxy for
human capital (Alasia, 2005; Alasia and Magnusson, 2005; Beckstead
et al., 2003; Magnusson and Alasia, 2004). Alasia & Magnusson (2005),
for example, developed a skills specialization quotient to measure dif-
ferentials in the type of jobs present across geographical regions. They
found that there is a clustering of skill within the Canadian labour
market, with managerial and professional occupations being con-
centrated in urban regions and unskilled occupations within rural la-
bour markets. However, Beckstead and Vindorai (2003) note that,
though rural-urban disparities persist in the distribution of knowledge
workers across Canada, there has also been growth in the amount of
knowledge work performed in rural areas. As such, this literature fo-
cusing on occupational categories concurs with that which uses edu-
cation as a proxy of human capital – finding notable differentials be-
tween rural and urban regions.
Studies using more refined measures of human capital to examine
rural-urban disparities in Canada are both scarce and dated. Using the
International Adult Literacy Survey (IALS), Willms (1997) found that
rural residents scored lower than urban counterparts on certain types of
skills (reading/quantitative). However, once their background char-
acteristics were accounted for, they actually surpassed their urban
counterparts by a margin equivalent to about one year of additional
schooling. Corbeil (2000), also using the IALS, found that a “major gap”
existed in adult literacy skills across urban and rural areas (p. 35–36).
However, he also observed that rural effects proved statistically insig-
nificant once variables like years of schooling, age and reading habits
were accounted for. Green and Riddell (2001) also report mean dif-
ferences in the literacy skills of rural and urban populations in Canada,
but do not examine the factors which may account for such differences.
Most recently, Green and Riddell (2013) analyzed correlates of cogni-
tive skills using the Adult Literacy and Life Skills (ALLS) survey. In-
terestingly, though they suggest place of residence (rural/urban) had a
statistically significant effect on skills scores, they omit this dummy
variable from their regression tables, and do not specify either its effect
size or direction. The most recent data available through the Statistics
Canada's Longitudinal and International Study of Adults (LISA) and the
Programme for the International Assessment of Adult Competencies
(PIAAC), though used to study the relationship between literacy and
income (Heisz et al., 2015, 2016), have yet to be employed to study
rural-urban disparities in skills. Needless to say, this state of the lit-
erature provides a less than ideal picture upon which to engage in
meaningful policy discussions about skills development and economic
development in northern and rural Canadian regions.
2.3. Why rurality matters?
Research consistently finds that socio-economic differences between
rural and urban populations account for a sizable share of the gap in
educational attainment, and thus, stocks of human capital, between
these populations (Cappon, 2006; Zarifa et al., 2018). However, even
when one compares “apples to apples,” rural students tend to
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Journal of Rural Studies 72 (2019) 252–263
underperform relative to their urban counterparts. Researchers argue
that within the Canadian context, rural-urban gaps are not due to dis-
parities in K-12 school quality – given that provincial funding formulas
produce relative “wealth neutrality” across schools (Fazekas, 2012).
Unlike in the US, where large differences exist in school quality from
one neighborhood to the next, Canadian provinces generally ensure
parity by funding schools according to their enrolments, student po-
pulation characteristics, and school board characteristics (Davies, 2016;
Li, 2008). Moreover, in those provinces where funding sources are both
provincial and local, disparities between wealthy and poor districts are
minimized through equalizing grants (Li, 2008). The weak effects of
school resources within Canada is further evidenced by recent Statistics
Canada reports which show that they account for a very limited portion
of the variance in student outcomes (Frenette, Ping Chan, 2015a,
2015b). Rural schools do face difficulty attracting more experienced
teachers (Cappon, 2006), but such factor has yet to be tied by re-
searchers to student outcomes, net of other influencers. Instead, re-
search has found that disparities in skills between rural and urban re-
gions in Canada may be attributable to broader community-level
differences (Cartwright and Allen, 2002).
The ecology of rural regions is often characterized by a dearth of
opportunities for learning which are more accessible in urban regions.
The Canadian Council on Learning, for example, has produced a
Composite Learning Index, which accounts for an array of factors, such
as access to cultural resources (e.g. museums), interaction with people
from other cultures, and access to other community institutions (e.g.
social, religious institutions). It has found that rural regions consistently
lag behind their urban counterparts in learning opportunities, as mea-
sured by this index (Cappon, 2006). Haight et al. (2014) have also
found, like previous researchers (Looker and Thiessen, 2003), that
Canadians in urban regions continue to have greater rates of internet
access – and use the internet with greater intensity than rural coun-
terparts. Though often taken for granted by urbanites, internet access
has been found to have a transformative effect on northern cities in
Canada, granting them easier access to social institutions, goods and
information (Collins and Barry, 2010).
3. Methods
3.1. LISA 2012 data
To assess the extent to which literacy and numeracy skills profi-
ciencies might vary regionally, this paper draws on data from the 2012
wave of Statistics Canada's Longitudinal and International Study of
Adults (LISA) survey. The LISA is an optimal data source for the ex-
ploration of skills distributions for several reasons. First, the LISA in a
nationally-representative survey that collects job, education, health,
and family information from people across Canada. The survey employs
a longitudinal design, interviewing respondents between January and
May of 2011 and 2012, and then again two years after (in 2013 and
2014). The main objective of the LISA is to assess outcomes related to
education and the labour market, including the long-term benefits of
postsecondary education, labour market mobility, the effects of em-
ployment on the health and well-being of families, and standards of
living for those in retirement. Data are collected via Computer Assisted
Personal Interviews (CAPI), with additional follow-up surveys con-
ducted by telephone if respondents were unavailable or ineligible for
personal visits.
Second, the LISA data overcome many of the methodological flaws
in self-reported survey data (e.g., over- and under-reporting of income)
because they have also been linked to administrative data, including
T1FF, T4, Pension Plan, and Immigration files.
Finally, of central importance to our skills focus, the first wave of
LISA data has been linked to the Programme for the International
Assessment of Adult Competencies (PIAAC), which includes standar-
dized assessments of literacy, numeracy, and problem solving in
D. Zarifa, et al.
technologically-rich environments, as well as the use of these skillsets at
work and in everyday life. The two surveys share a portion of their
samples, though the target populations differ in their scope. That is, the
LISA includes respondents of all ages, while the PIAAC surveys only
those respondents between the ages of 16 and 65 years old at the time
of the initial survey. Since the PIAAC skill component is only available
in the 2012 database, our analyses draw only from the first wave of
LISA data. The sample therefore consists of 8500 respondents contained
in the integrated PIAAC-LISA data file.4
3.2. Analytical approach
To investigate the rural-urban skills gap, our statistical analyses
include descriptive statistics and binary logistic regressions (Long and
Freese, 2014; Long, 1997). Our regression models are used to assess
literacy and numeracy skills across a number of rural-urban population
categories. These models are ordered, such that the first model re-
gresses the rural-urban variable against the dependent variable,
without controls. The second model, Model 2, then introduces key so-
ciodemographic control variables. Finally, Model 3 includes all pre-
vious variables from Models 1 and 2 with additional terms to control for
the effect of level education on skill level. Given the complexity of the
LISA and PIAAC surveys, all models were estimated using the REPEST
package for STATA (Avvisati and Keslair, 2016). Finally, to aid in the
interpretation of the binary logistic regression results, predicted prob-
abilities for our rural-urban variable, along with 95 percent confidence
intervals are calculated and presented in graphical displays.
3.3. Dependent variables
We examine skills gaps across rural-urban populations in Canada
with two key dependent variables: (1) literacy, and (2) numeracy.5 As
mentioned above, the PIAAC component of the LISA contains the
standardized measures of literacy and numeracy proficiencies. For lit-
eracy, respondents in PIAAC were measured for their ability to engage
with print-based and digital written texts. They were accessed in their
abilities to identify and process information in a variety of different
settings and across a wide range of texts. For numeracy, respondents
were measured on their ability to engage with mathematical informa-
tion to infer their ability to meet the mathematical demands across a
range of settings. Specifically, respondents were assessed on their un-
derstanding of mathematical content and ideas (e.g., dimensions, re-
lationships, quantities, numbers) and the representation of that content
in graphs, diagrams, pictures, and objects (see Statistics Canada, 2013
for further details). The measurement scale for both literacy and nu-
meracy domains ranged from 0 to 500. The following proficiency levels
(Below 1 to 5) were also created and are commonly used to aid in the
interpretation of the raw scores (adapted from Table 1.1 in Statistics
4
In our final subsample, we also restricted to those who were not self-em-
ployed (n = 7560), and had valid data across all of our analysis variables
(n = 7395). Listwise deletion was used to remove 2.18 percent of cases on
parents' education variable, and less than 30 missing cases on the marital status,
aboriginal status, and education level variables combined. While listwise de-
letion can be problematic when data are not missing completely at random, in
cases where missing data is small such as ours, it is often preferred over com-
putationally intensive missing data techniques to avoid adding an additional
layer of measurement error to the data (see Allison, 2001; Cheema, 2014).
5
We do not consider potential gaps in problem solving skills in technologi-
cally rich environments (PSTRE) here, since a sizable portion of the LISA sub-
sample did not do the PSTRE assessment. The PSTRE assessment was not done if
the person had insufficient computer skills, or the person opted to do a paper-
and-pencil-based assessment, or the person did not do the computer assessment
for literacy-related reasons. As a result, there are missing values for PSTRE
proficiency values that are not missing at random and addressed through the
LISA imputation or weighting (see Statistics Canada, 2013).
255
Journal of Rural Studies 72 (2019) 252–263
Canada, 2013: 16).
Below 1: adults scoring between 0 and 175
Level 1: adults scoring between 176 and 225
Level 2: adults scoring between 226 and 275
Level 3: adults scoring between 276 and 325
Level 4: adults scoring between 326 and 375
Level 5: adults scoring between 376 and 500
In step with previous studies using PIAAC and its predecessor, the
ALL (Adult Literacy and Life Skills survey), we dichotomized these
measures of skill: (1) low skills, and (2) high skills (Hango, 2014;
Statistics Canada et al., 2013; OECD and Statistics Canada, 2011; OECD
and Statistics Canada, 2005). Respondents with “low” levels of skill are
those who achieved scores below category 3 on the skill assessment
scale, while respondents with “high” skill achieved scores at three and
higher. Prior research suggests that on average the working populations
with at least Level 3 skill proficiency are more likely to fully and pro-
ductively participate in today's knowledge-intensive economies (Carey
2014; OECD and Statistics Canada, 2005). Empirically, roughly 51
percent of populations across OECD countries including Canada can
successfully perform tasks at least at Level 3 (Statistics Canada, 2013).
3.4. Independent variables
Since our primary goal of the analyses is to determine skills differ-
ences across rural and urban populations, our key independent variable
in our analyses measures the population characteristics of the re-
spondent's location of residence at the time of interview. This variable
adheres to Statistics Canada's (2010) population center definition in the
2011 Census and is comprised of five categories: (1) rural area (less
than 1000 residents); (2) small population center (1000 to 29,999 re-
sidents); (3) medium population center (30,000 to 99,999 residents);
(4) large urban population center (100,000 to 499,999 residents); and
(5) metropolitan population center (500,000 or greater).6
In order to assess the extent to which population size has an in-
dependent effect on skills, we include several key sociodemographic
control variables in the analyses. Our review of the literature above
pointed to the following key control variables to account for the array
of factors that may also influence the acquisition of skills and ultimately
explain regional skills gaps: age, age-squared,7 immigration status, in-
digenous status, sex, marital status, highest level of parental education,
employment status, province of residence, and highest level of re-
spondent's education. The natural log of income as reported on the
respondent's tax file and linked to the LISA through the T1FF (i.e., total
income from employment reported on 2011 T4 slips) has also been
included as a control in order to consider the effect of earnings on skill
levels, while also accounting for the typically skewed distribution of the
variable.8 The independent variables in the following analyses are
treated as categorical, with the exception of age and the natural log of
income. For further details on variable definitions and categories, see
6
Given the rather restricted definition of rural as places with a population of
less than 1000, we include the five-category disaggregated version in our
analyses which includes all possible categories across this variable rather than
use the simple dichotomy of rural and urban. This population center variable is
readily used in the Canadian Census of Population, and was defined and created
by Statistics Canada in 2010 (for details, see https://www.statcan.gc.ca/eng/
subjects/standard/pcrac/2016/introduction). By this definition, a population
center has a population of at least 1000 and a population density of 400 persons
or more per square kilometer, and all areas outside population centers are
classified as rural areas.
7
We use orthogonal polynomial contrasts for age and aged-squared in all
regression models account for the collinearity between these two variables.
8
Unlike other surveys that use self-reported estimates of earnings, the LISA
contains data linkages to administrative tax records. Thus, we are able to ac-
count for much more precise income figures for respondents than survey data
typically allows.
D. Zarifa, et al.
Fig. 1. Predicted probabilities of literacy proficiency by population center (without controls).
Table 1.
4. Results
4.1. Characteristics of the 2012 LISA respondents
Table 1 shows the summary descriptive results of the sample used in
our study. Roughly 51 percent of the sample achieved high levels of
literacy, while the corresponding 49% were among those with low le-
vels of literacy skills. At the same time, 44% of respondents have high
numeracy skills, while 56% have low numeracy skills. Approximately
16 percent of the sample reside in rural locations with less than 1000
residents. Alternatively, 12 percent of respondents are from small po-
pulation centers between 1000 and 29,999 residents, 9 percent are from
medium centers with populations between 30,000 and 99,999, and 15
percent are in large urban centers with populations between 100,000
and 499,999. The largest number of respondents are from metropolitan
centers with populations greater than 500,000 (48 percent of the
sample).
The average age of respondents in the sample is 40 years.
Approximately 77 percent of the respondents are Canadian born, while
the remaining 18 percent are established immigrants, and 5 percent are
those who immigrated to Canada within five years of the time of survey.
Only 3 percent of the sample are indigenous respondents.
Approximately 51 percent of the sample are female, with males com-
prising the remaining 49 percent. Respondents who were married or
common law made up 57 percent of the sample, with the remaining 43
percent those who were not married at the time of survey. Roughly 76
percent of respondents did not have at least one parent who had ob-
tained a university degree, with the remaining 24 percent of re-
spondents having at least one university-educated parent.
Respondents who are employed comprise 74 percent of the sample,
while only five percent of respondents are unemployed. Respondents
who were not actively involved in the labour market make up the re-
maining 21 percent of the sample. The average income of respondents is
$37,297. With respect to province, roughly 39 percent of respondents
are from Ontario, followed by 24 percent from Quebec. Similar pro-
portions of respondents are from British Columbia and Alberta (12
percent and 11 percent respectively). The remaining respondents are
from Manitoba (4 percent), Saskatchewan (3 percent), Nova Scotia (3
percent), Newfoundland (2 percent), and New Brunswick (again, 2
percent). Less than 1 percent of the respondents are from Prince Edward
256
Journal of Rural Studies 72 (2019) 252–263
Island.
Finally, 16 percent of the sample consists of those respondents who
have less than a high school diploma, while 26 percent of respondents
have at least a high school education. Respondents with certification in
the trades make up 12 percent of the sample, while 23 percent of re-
spondents have some form of postsecondary education below a ba-
chelor's degree. Roughly 15 percent of the sample are bachelor gradu-
ates, while the remaining eight percent are those who have obtained a
university degree above the bachelor level.
4.2. Rural-urban Literacy Skills gaps?
To investigate the extent to which location of residence impacts
literacy proficiencies, we estimate a series of binary logistic regressions
(see Table 2). As outlined above, initial models contain only our key
independent variable for population center and size. Our next model
adjusts for all controls with the exception of education level, which is
added to the mix in the third model, to separate out the explanatory
strength of pursuing advanced levels of higher education on literacy
levels.
Indeed, Model 1 reveals significant skill differences across popula-
tion centers. Respondents in large urban centers have higher levels of
literacy, though the differences are more pronounced for large urban
centers with populations between 100,000 and 499,999 (p < 0.01),
than for metropolitan areas with more than 500,000 residents
(p < 0.05). At the same time, respondents living in medium and
smaller population centers are not statistically different from those in
rural areas, suggesting that there may be literacy skill shortages in these
less populated, more rural areas in comparison to largely populated
areas of Canada.
These differences can best be seen when comparing the predicted
probabilities of literacy proficiency from Model 1 in Fig. 1. Overall,
residents from rural areas show the lowest probabilities of achieving a
literacy score at Level 3 or higher (0.456). In fact, with the exception of
metropolitan centers, the probabilities appear to climb steadily with
population center size. Those in large urban centers show the highest
probabilities at .536, followed by metropolitan centers (0.518),
medium population centers (0.515), and finally small population cen-
ters (0.477).
In Model 2, the binary logistic regressions adjust for a number of
sociodemographic factors. The results reveal that the relationships
presented in the previous model hold, although the inclusion of these
D. Zarifa, et al.
variables does weaken the previously observed relationships slightly.
Once again, large urban centers and metropolitan areas are significantly
more likely to have higher levels of literacy. However, the significance
of the large urban population centers effect weakens slightly to
p < 0.05, while the coefficient for metropolitan centers increases
slightly over the previous model.9 Again, medium and smaller popu-
lation centers do not significantly differ from rural areas in their lit-
eracy levels.
There are a number of significant control variables in the model that
are worth noting. As found with previous surveys (OECD and Statistics
Canada, 2011), our quadratic term for age is negatively associated with
literacy proficiency, suggesting a non-linear relationship whereby lit-
eracy proficiencies first increase for younger age groups, peak, and
increasingly decline for older respondents (p < 0.01). In terms of im-
migration status, both established immigrants (greater than 5 years)
and recent immigrants (5 years or less) had lower levels of literacy than
Canadian born respondents, though the skill gap was greater for recent
immigrants than those who had lived in Canada for longer than 5
years.10 Indigenous respondents were also more likely to show lower
literacy levels than non-indigenous respondents (p < 0.05). Re-
spondents whose parents had acquired higher education credentials
reported higher literacy levels (p < 0.001). As well, the likelihood of
achieving higher literacy levels increases with one's level of income
(p < 0.001). Finally, among the provinces, only respondents in New-
foundland and Quebec (p < 0.001) showed significantly lower like-
lihoods of achieving higher literacy levels than their counterparts in
Ontario.
Fig. 2 displays the predicted probabilities and their corresponding
95 percent confidence intervals of literacy proficiency by population
center estimated from Model 2.11 By and large, the inclusion of socio-
demographic control variables does not significantly alter the absolute
values of the predicted probabilities estimated in Model 1. However,
the relationship between population size and literacy proficiency ap-
pears to be more linear than before. That is, predicted probabilities
consistently increase with population size, and metropolitan centers
now show the highest predicted probability at .532.
Model 3 includes all of the previous variables with the addition of
level of education, to isolate the impact that higher education has on
skill level differences between population centers. As expected, in-
troducing respondents' level of education influences the previous find-
ings considerably. Most importantly, our population center effect is no
longer significantly associated with literacy proficiency, once level of
education is introduced into the model. Therefore, it is likely that the
previous literacy differences higher concentrations of individuals with
postsecondary education in larger population centers.
To further grasp these differences, the predicted probabilities of
literacy skill levels by population center from Model 3 are plotted in
Fig. 3. Interestingly, when including level of education, the prob-
abilities of achieving Level 3 or higher literacy proficiency decrease for
metropolitan centers (from 0.532 in Model 2 to 0.505 in Model 3),
while medium and large urban centers show the highest probabilities at
.517 and .516 respectively. Small population centers and rural areas
show comparatively smaller probabilities at .489 and .488. As such, it
appears that much of the difference between the literacy proficiencies
of respondents may be attributable largely to the educational differ-
ences between these groups.
9
Although the effect weakens slightly to p < 0.05, the coefficients indicate
that once sociodemographic factors are accounted for, metropolitan areas have
the highest literacy rates of the five population centers included in the model,
surpassing large urban centers (the previously highest reported literacy values
in the zero order models).
10
It is important to note that both effects are highly statistically significant
p < 0.001.
11
In Fig. 2, the predicted probabilities are calculated by holding all control
variables at their sample means and/or proportions.
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Journal of Rural Studies 72 (2019) 252–263
4.3. Rural-urban numeracy skills gaps?
A similar approach was used to investigate numeracy differences
among population centers. Once again, in our binary logistic regression
models, variables were entered in three stages to first observe the zero
order effect of population center type on numeracy skill levels before
adjusting for other related factors in subsequent models. For Model 4,
only population center is included in the model. Overall, the results
indicate that residents of large urban centers and metropolitan areas are
significantly more likely to achieve higher numeracy skills than those
from rural locations (p < 0.05 and p < 0.01 respectively). As with
our previous models for literacy, these findings may suggest that re-
sidents in rural locations have either fewer opportunities to develop
their numeracy skills, or that such regions may have more difficulties
attracting and retaining individuals with higher levels of numeracy
skills.
Fig. 4 shows the predicted probabilities of numeracy proficiency by
population center estimated from Model 4. These unadjusted estimates
indicate that residents from large urban population centers as well as
metropolitan centers have the greatest chances of achieving high levels
of numeracy (0.463 and 0.456 respectively). Medium population cen-
ters have the next highest probability (0.439), while small population
centers, and those in rural areas, have comparatively lower prob-
abilities (0.398 and 0.389 respectively). It is interesting to note that the
overall pattern in the relative probabilities does look similar to that
which was found for Model 1 above. However, much like the numeracy
proficiency scores more generally in the population, the overall prob-
abilities of achieving high numeracy levels are comparatively lower
than those for literacy.
When introducing sociodemographic control variables in Model 5,
the population center effect weakens slightly, though respondents
living in both large urban centers and metropolitan areas remain sta-
tistically significantly more likely to achieve higher levels of numeracy
proficiency than those living in rural locations (p < 0.05 and
p < 0.01 respectively). As with Model 4, respondents residing in
medium and small population centers do not significantly differ from
those living in rural locations in regard to their numeracy skills.
Similar to the literacy models, a number of significant effects among
the control variables are worthy of note. Immigration status was again
statistically significantly related to skill level, as both recent immigrants
and established immigrants (to a lesser extent) have lower levels of
numeracy than Canadian born respondents (p < 0.001). Indigenous
respondents have lower levels of numeracy than non-indigenous re-
spondents (p < 0.01), while those respondents whose parents had
acquired higher education have greater levels of numeracy
(p < 0.001). Interestingly, women are more likely to have higher le-
vels of numeracy than men (p < 0.001), an encouraging finding given
recent policy initiatives geared towards increasing female involvement
in STEM fields. Married respondents have higher levels of numeracy
than those who are single (p < 0.01). In terms of age, once again our
quadratic term is statistically significant (p < 0.001). Similarly, higher
income individuals were also more likely to obtained higher numeracy
skills (p < 0.001). Finally, numeracy skill levels varied little by pro-
vince – only respondents in New Brunswick show significantly lower
levels of numeracy than respondents in Ontario (p < 0.05).
Fig. 5 shows the predicted probabilities of numeracy by population
center for Model 5. Once again, including sociodemographic control
variables weakens the probability of achieving higher numeracy levels
for each of the population centers. Still, large urban centers (0.454) and
metropolitan areas (0.452) have the highest probabilities of numeracy.
Medium population centers respondents continue to have a greater
probability (0.42) than those living small centers, and in rural areas
(each with a probability of .38).
Finally, in Model 6, when controlling for level of education differ-
ences between population centers, the effect of location on numeracy
differences is no longer statistically significant. This suggests that the
D. Zarifa, et al.
Fig. 2. Predicted probabilities of literacy proficiency by population center (with controls).
Fig. 3. Predicted probabilities of literacy proficiency by population center (with controls and level of education).
numeracy differences between large population centers and rural lo-
cations may also be the result of the greater levels of education for those
individuals residing in more densely populated areas.
In Fig. 6, the predicted probabilities estimated from Model 6 are
shown. By including level of education in the mix, the probability of
achieving high numeracy levels for metropolitan centers drops to .416
(from 0.452 in Fig. 5). The probability for large urban centers similarly
weakens (though to a probability of .44, from 0.454 in the previous
estimation). Residents in medium population centers have a slightly
increased probability of numeracy (0.438), while those in small centers,
and rural areas of Canada see an increase in the probability of nu-
meracy (each to 0.401 and 0.412 respectively). Therefore, the change in
probabilities which appears in the estimates for Model 6 suggests that
much of the difference between rural areas and large urban populations
can be attributed to differences in the level of education of respondents
in these areas.
258
Journal of Rural Studies 72 (2019) 252–263
5. Discussion and conclusions
Our paper contributes to the existing literature and sets the stage for
policy initiatives in two key ways. First, our work demonstrates that the
traditional rural-urban human capital disparities identified through
older reports (e.g. Bollman, 1999; Magnusson and Alasia, 2004) persist,
ostensibly serving as an impediment to the full participation of rural
Canadian communities within the new knowledge economy. Specifi-
cally, our study demonstrates that skills in the Canadian workforce
differ across locations of varying size and density. It is important to note
that our findings are a marked improvement over studies using proxies
such as education levels or years of education, in that we identify more
refined literacy and numeracy skills gaps. Moreover, it is interesting to
note that rural and smaller population centers show markedly lower
levels of literacy and numeracy proficiencies compared to medium,
large, and metropolitan population centers. Our disaggregation of rural-
urban to five categories also sheds new light on rural-urban differences,
as the skill gaps of small- and medium-sized population centers often
resemble the situation of “rural” areas.
D. Zarifa, et al.
Fig. 4. Predicted probabilities of numeracy proficiency by population center (without controls).
Fig. 5. Predicted probabilities of numeracy proficiency by population center (with controls).
A second key contribution of our study is that we examine which
sociodemographic factors play a critical role in explaining rural-urban
differences in skills proficiencies. Overall, our analysis suggests that the
sizable rural-urban skill differentials we uncover may be attributable
primarily to regional disparities in educational attainment. This finding
should be of import to both scholars seeking to understand rural-urban
disparities in human capital, along with government actors wishing to
ameliorate them through policymaking. For academic researchers, our
findings should prompt an interest in the decision-making processes at
the individual level that may underlie these observed population-level
patterns. Moreover, while the current study brings the Canadian con-
text to the forefront, PIAAC's skills data have been collected in part-
nership with the OECD in 22 other countries worldwide (see Hanushek
et al., 2015). Future studies that explored literacy and numeracy skills
gaps across rural-urban areas in additional countries would be bene-
ficial in furthering our understanding of how rural-urban skills dis-
parities might vary cross-nationally.
Although studies such as this one have made much headway over
the last decade, using large scale datasets to demonstrate that rural
259
Journal of Rural Studies 72 (2019) 252–263
residents possess lower stocks of human capital (e.g. Cuddy and
Moazzami, 2017a; Moazzami, 2015a), are less likely to attend uni-
versity rather than college (e.g. Finnie et al., 2015; Newbold and Mark
Brown, 2015; Zarifa et al., 2018), and to enter lucrative STEM fields
(Hango et al. forthcoming), theoretical explanations for these docu-
mented disparities remain largely underdeveloped. Often, theorizing
has evolved in response to the findings of case studies focused on small
and very distinct rural communities (e.g. Corbett, 2005), rendering the
generalizability of such frameworks questionable. This scarcity of
broader level theorizing about recently observed rural-urban disparities
in Canada and other nations is unsurprising, given that the study of
rural education itself remains a relatively peripheral enterprise (Bæck,
2016; Corbett, 2014). We posit, however, that it would be fruitful to
develop a nuanced theoretical understanding of student decision-
making within rural communities as a form of socially “embedded”
behavior (Coleman, 1988; Granovetter, 1985), one that is informed by
and responsive to the local opportunity structures which rural folk
encounter. Given the varied place-specific education and employment
opportunity structures, this embedding may be highly contextual,
D. Zarifa, et al.
Fig. 6. Predicted probabilities of numeracy proficiency by population center (with controls and level of education).
dynamic and ‘differentiated' (Ryan, 2018).
As Bæck (2016) astutely notes, geographic proximity to HE in-
stitutions, employment opportunities in regional labour markets, and
gendered norms about what work is appropriate or desirable for certain
individuals serves as a “prism” through which rural residents will
evaluate educational pathways and make decisions. Such structures will
shape rural resident's educational trajectories, producing the regional
disparities that have been recently observed. Beyond mere “distance
deterrence” (Sá et al., 2004, 2006), and the array of socio-economic
barriers which are routinely cited as explanations for the lower edu-
cational attainment levels in rural communities (see Zarifa et al., 2018),
it may be the case that rural residents make educational decisions that
correspond with employment opportunities within their regions that
they have intimate knowledge about, or those which have been a part of
family or town traditions (e.g. fishing, mining). By contrast, they may
eschew those pathways that lead to foreign urban spaces, and positions
for which they lack first-hand knowledge. Successfully mapping these
consequential sense-making processes will require richer data sources
than are currently available, and likely entail ambitious mixed-metho-
dological research designs. Nonetheless, such efforts will be key to
developing more nuanced and comprehensive theoretical explanations
for rural-urban disparities in human capital.
Based on our findings, along with a review of the extant literature
covered earlier in this piece, we argue that rural-urban disparities in
educational attainment could be addressed by policymakers using a
two-pronged strategy: (1) extending educational access across rural
regions, and (2) reversing regional out-migration or “brain drains.” It is
important to underscore that policy initiatives in each of these areas
will necessarily be flexible in their scope and will need to take into
consideration the unique and complex social, cultural, economic, and
environmental contexts to account for the diversity of rural places
(Lauzon et al., 2015; McManus et al., 2012). With respect to enhancing
rural access to education, starting in the 1960s, provincial governments
in Canada pursued this strategy through the establishment of new
colleges and universities across underserved rural or remote regions. In
light of the heavy infrastructure costs this strategy entails, along with
the limited and shrinking supply of students outside of urban regions,
provincial governments have recently sought to “reach the north”
through online education. For example, Contact North, a subsidiary of
the provincial government in Ontario, offers electronic access to pro-
gramming from the province's 76 district school boards, 46 public
colleges and universities, and 250 literacy and basic skills providers.
260
Journal of Rural Studies 72 (2019) 252–263
Through its online platform, rural residents are able to improve their
skills and obtain credentials without having to leave their communities.
In its efforts overcome the challenge of limited internet connectivity
and access to technology in remote communities, Contact North has
established a physical network of 116 learning centers which provide
free access to computers with high-speed internet, along with access to
audio-, video- and web-conferencing platforms. The intensification of
these efforts in Ontario and other provinces could play an important
role in helping to diminish rural-urban skills disparities, helping rural
students overcome traditional barriers to obtaining an education.
It is unlikely, however, that improving access to education and
training alone will correct the regional skill disparities documented
through this study. Attracting skilled migrants and encouraging new
employment opportunities will also be critical to bolstering rural
human capital levels. Highly-skilled individuals from remote regions in
Canada will continue to migrate to urban “hubs” to secure employment
which matches their credentials if comparable work is not readily
available in their local community. Yet, counter-urbanization efforts in
many rural communities in Manitoba have shown great success at-
tracting immigrants by expanding their services to newcomers, through
local immigration partnerships across municipalities, employers, and
local service providers (Markey et al., 2015; Lauzon et al., 2015). Still,
immigration settlement services are not equally distributed across
western and northern Canada (Lauzon et al., 2015). At the same time,
research from other countries is finding that foreign-born students with
foreign-born parents often face more difficulties realizing their educa-
tional aspirations in non-urban settings (Lewith and Reilly, 2014). But,
in rural places where metropolitan hubs are close by such as in Ontario,
rural revitalization and counter-urbanization initiatives may be fruitful
options to build and maintain human capital levels. In many countries
worldwide, cheaper housing, employment opportunities, environ-
mental amenities, and quality-of-life factors in rural areas have all
shown to be important factors to lure urban residents to smaller mu-
nicipalities (Wirth et al, 2016; Mitchelle, 2008; Dahms and McComb,
1999). However, in some of the more northern and remote rural areas
of Canada, where metropolitan areas are distant, such urban out-mi-
gration is not possible.
As such, it will be incumbent upon local, provincial and federal
governments to also engage in concerted efforts to construct “business
friendly” environments in rural communities for the specific types of
companies that hire highly-skilled personnel – such as those operating
within the advanced manufacturing and information technology
D. Zarifa, et al.
sectors. The first, and simplest, piece of this puzzle entails expanding
the supply of skilled workers, as advocated in the paragraph above, to
ensure said companies that they will have a steady supply of labor. The
second, and far more complex step, entails the development of a com-
prehensive framework of incentives to motivate companies to relocate
to rural regions. This can include i) revising taxation or subsidy
schemes, to provide concrete financial incentives for relocation, ii) re-
viewing regulatory frameworks (e.g. land use, zoning), to remove un-
necessary bureaucratic hurdles for businesses operations, and iii) im-
proving local infrastructure (e.g. transportation system), to facilitate
business operations. Unfortunately, there is no “full-proof” blueprint to
guide this process, though some resources (e.g. handbooks) exist in
Canada to guide rural communities wishing to attract new employers.
In addition, the trajectories of outlier regions that have managed to
develop into world-leading hubs in technological innovation (e.g.
Silicon Valley), often benefitted from historical or institutional cir-
cumstances that are not replicable, thus providing lessons which may
not be useful for other communities wishing to make a similar leap.
Nevertheless, though certainly difficult, producing steady demand for
highly-skilled workers in rural communities will be a necessary step in
correcting regional skill imbalances.
Acknowledgement
This research was undertaken, in part, thanks to funding from the
Canada Research Chairs program and the Social Sciences and
Humanities Research Council of Canada (Grant # 430-2017-0661).
Appendix A. Supplementary data
Supplementary data to this article can be found online at https://
doi.org/10.1016/j.jrurstud.2019.10.032.
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