|
Indicator 6.3.1 - Economic diversity index of forest-based communities core indicator 
Economic diversity is a measure of the uniformity of employment across all sectors of the economy. This index, which is calculated by determining the portion of total personal income derived from one sector divided by the total income from all sectors, is a common measure of economic diversity in the forest sector (Christensen et al. 2000). The index is based on the major groupings of Standard Industrial Classifications using 2001 census data and has a range from 0 to 4.31, with the higher figures reflecting higher economic diversity. As a measure of economic diversity, this index provides some insight into the range of employment opportunities in the census subdivisions (CSDs). More economically diverse CSDs will be better positioned to absorb and respond positively to various shocks to the economy. If one sector contracts, there are opportunities locally for employees to be absorbed into other sectors of the economy. Table 6.3a shows a somewhat paradoxical relationship between the levels of forest dependence and economic diversity. Intuitively, one can assume that with greater dependence on a single sector the economic diversity index would be lower. Instead, this analysis shows the opposite trend where, for example, multiresource-dependent CSDs at the national level report a significantly lower diversity score than forestdependent CSDs. This positive relationship between increasing forest dependence and increasing economic diversity is very strong in Nova Scotia, Saskatchewan, and Alberta. Results suggest that, in general terms, the forest-dependent CSDs marked by high economic diversity benefit from some economic activity in other sectors of the economy as well. These results may indicate the extent to which forest-based economies attract a wide range of economic activity that are not related to forestry or they could be due to induced and indirect jobs in other sectors that spin off of forestry employment. Table 6.3a Average economic diversity for non-Aboriginal census subdivisions.
nd: Not determined due to insufficient data. Results from the analysis of Aboriginal CSDs (Table 6.3b) are similar to the analysis of non- Aboriginal CSDs. Forest dependence is positively related to economic diversity in most regions of Canada. For example, forest-dependent CSDs at the national level report a significantly higher diversity score of 1.37 compared with 0.55 for nonforestdependent CSDs. The relationship is statistically significant in all regions except for Atlantic Canada. Table 6.3b Average economic diversity for Aboriginal census subdivisions.
ns: Not significantly different from nonforest-dependent CSDs. The analysis of Aboriginal CSDs must be interpreted cautiously due to the strong positive relationship between CSD size and economic diversity. The forest-dependent communities in this analysis are larger than the nonforest-dependent communities, which will influence the degree of economic diversity because larger centers naturally tend to be more economically diverse. |