Beyond the Gender Binary: Wage Inequality and Occupational Segregation among Transgender and Nonbinary Workers

This study examines labor market disparities across gender identities in Canada using data from the 2021 Canadian Census, the first national census to identify transgender and nonbinary individuals. We analyze employment probabilities, work hours, and hourly wages among six gender groups: cisgender men, cisgender women, transgender men, transgender women, and nonbinary individuals assigned male or female at birth. Transgender and nonbinary individuals are 8–14 percentage points less likely to be employed than cisgender men and earn 20–30 percent lower hourly wages on average. After adjusting for demographic, occupational, and industrial characteristics, earnings gaps remain substantial—approximately 8–17 percent— and are largest for nonbinary individuals assigned female at birth. Subgroup analyses reveal pronounced heterogeneity across occupations: wage gaps are smallest in health-related fields but largest in management and leadership positions, where gender minorities are also underrepresented. Transgender men fare relatively better in male-dominated fields such as trades and manufacturing, while nonbinary individuals show higher representation in arts and education. Oaxaca–Blinder decompositions indicate that about half of the overall wage gap is explained by differences in observable characteristics, with the remainder unexplained. The findings document persistent and uneven economic disadvantages for gender-diverse populations and highlight occupational contexts where barriers to inclusion are most pronounced. JEL code: J0