Research warns streaming school classes by ability is racist and should be stopped.
The study of 70,000 Māori learners, He Awa Ara Rau, said Māori were disproportionately represented in low-ability classes, which hampered their ability to get the qualifications that lead to well-paid jobs.
The research was conducted by BERL in collaboration with Waikato Tainui, Auckland Council's Southern Initiative and Tokona te Raki: Māori Futures Collective of Te Rūnanga o Ngāi Tahu.
It said teachers should stop streaming their students.
"How students are streamed is in itself problematic. Bias and deficit thinking play a key role in this. The number of Māori placed in foundation classes is way out of proportion to non Māori. This is systemic racism," the report said.
"Once streamed into these foundation classes, it can be difficult for students to get back into a class that offers them the opportunity to be successful with NCEA in that subject, and this in turn severely restricts career choice."
The report said streaming at Years 9-10 could, for example, stop Māori children from even attempting Level 1 NCEA algebra.
"This is often a prerequisite for Level 2 mathematics and other subjects such as physics, and therefore impacts on career choices such as medicine."
It said fewer than half of Māori students sat the exam for level 1 algebra, but two-thirds of those who passed it went on to get NCEA level 3 and more than half gained University Entrance.
The report said schools that stopped streaming their students got better results.
The executive director of Tokona te Raki, Eruera Tarena, said the impact of streaming on students' future choices was a shock.
"The 20 percent pay gap for Māori, it's not by accident - those pathways are very much set at a very young age at 14, 15 or even earlier," he said.
He said interviews with 100 Māori students showed streaming had a negative impact on their lives.
"When a rangatahi gets put in a foundation maths or science class they read that as a signal that the teacher thinks I'm dumb therefore I am dumb... so you start to have a domino effect that, when Māori are streamed, that often results in increases in behavioural issues and then also has a flow-on effect where you have higher numbers of Māori that are expelled or stood down from school," he said.
"So just this one simple practice which largely is acknowledged as a racist, archaic, damaging practice is still deeply embedded in the structure and culture of our education system."
Tarena said the Education Ministry should consider removing streaming from schools.
"It is a good, concrete example of structural racism in Aotearoa that is hugely damaging for Māori and Pasifika."
The report also recommended increasing the number of Māori teachers, a shift to restorative behaviour management in schools and ensuring Māori culture and language were heard in the classroom.