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Staying in school leads to bigger paycheques later

Wages for skilled labour workers jumped, but having a university degree still pays more in the long run


 

Staying in school pays off, according to the latest census data released Thursday by Statistics Canada. Full-time workers with a university degree earned substantially more than those with just a high school diploma, regardless of age or sex, the data shows. And the more degrees the better.Young men with a bachelor’s degree, for example, had median earnings of $50,506 while those with graduate degrees had even higher median earnings at $54,686.

“By and large we do find in Canada those with high levels of education don’t tend to suffer on the labour market,” said Wolfgang Lehmann, a sociologist at the University of Western Ontario. “They tend to have higher levels of employment, lower levels of unemployment. They’re less likely to find themselves in part-time work or contract work and more likely to get benefits and higher salaries.”

Those with a registered trade or apprenticeship were earning nearly $40,000 — some $2,600 more than those who had a high school diploma and some $8,000 more than those who didn’t even have that. And given the shortage of skilled trades people, Lehmann suggested it’s an area Canadians ought to be considering.

Disparities in earnings between those with a high school diploma or less and those with a university degree were even more pronounced among older workers, the 2006 census shows. For example, the median earnings of women aged 45 to 54 with a university degree surpassed those with no high school diploma by more than $33,000. In fact, just having that high school diploma earned women some $9,000 more, on average.

“Education is paying off. It may not always pay off to the extent an individual would like it to pay off, but it is paying off,” Lehmann said. “The most disadvantaged in the labour market in Canada are still those that don’t even graduate from high school.”

Canada’s top earners — those making six-figure salaries — were also more likely to have a university degree. Although they represented no more than a quarter of full-time earners, those with a university degree accounted for 57 per cent of $100,000-plus earners and 65 per cent of $150,000-plus earners.

While women have traditionally made less money than their male counterparts, those with higher levels of education found the gap far less pronounced. For example, women aged 25 to 29 with a graduate or professional diploma earned 96 cents for every dollar earned by their male counterparts in 2005. Those with just a bachelor’s degree made just 89 cents to every dollar earned by a man with a similar level of education. Young women with no high school diploma were also earning just 67 cents to every dollar earned by men with a similar lack of education, the data shows.

The trend, however, didn’t hold true for women with a registered apprenticeship or trade certificate as they reportedly made just 65 cents for every dollar earned by their male counterparts.

The gap between male and female workers who have similar levels of education was mainly due to the fact that young women are over represented in low-paying occupations, the census documents suggested. “Gender differences in earnings within identical occupations were generally very small among new entrants,” the document reads.

The two exceptions to that rule were management jobs and sales and service occupations where women consistently earned far less than men, the documents revealed.

Young women with a bachelor’s degree employed in the art, culture, recreation or sports industries earned the same as men in 2005, while those employed in social sciences, education, government services and religious occupations earned just a penny less than their male counterparts. In contrast, those in management earned just 86 cents for every dollar earned by men in similar positions in 2005.

One segment of the population that a university degree did little for were recent immigrants.

In 2005, recent immigrant men with a university degree earned just 48 cents for each dollar earned by Canadian-born male university grads. By contrast, recent immigrant males with no university degree earned 61 cents for every dollar received by their Canadian-born counterparts.

Similar patterns were observed among recent immigrant women. “The larger earnings disparities among university graduates were observed as many recent immigrants with a university degree were employed in low-skilled occupations,” the census report said.

-with a report from CP


 
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