April 28, 2014 12:15 pm
Updated: April 28, 2014 12:54 pm

Wage difference between high school and college grads ‘narrowing’

A new Statistics Canada report suggests real average hourly compensation among male college graduates has fallen marginally over the past decade. Female college grads have fared better.

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A bachelor’s degree doesn’t hold quite the economic weight it once did, and the proof is in the pay —  just ask recent male college graduates.

A new study from Statistics Canada published Monday compares real average hourly wages for male and female high-school grads versus college degree holders over the last decade, and shows flat earnings growth among men with degrees in that time.

Women with degrees, meanwhile, saw wages climb five per cent during the time the study looked at.

College grads from both genders have lost ground to high-school graduates, who experienced outsized wage gains during the study, according to the federal agency.

Male high school grads have seen real average hourly pay increase by 11 per cent, while pay for females with a high school education is up 9 per cent.

“As a result, wage differentials between young high school graduates and bachelor’s degree holders narrowed,” Statscan said.

WAGE COURSES

Pay difference between college and high school grads narrowed between 2002 and 2012. Here’s a look as some key numbers:

9 – percentage increase in real average hourly pay for male high school graduates.

Unchanged – percentage increase in male counterparts with undergraduate degrees.

75 – cents that male high school grads make for every $1 a college grad earns, up from 68 cents in 2002 period.

68 – cents female high school grad make for every $1 a female college grad earns (from 64 cents).

Source: Statistics Canada

The study compared compensation among fully employed workers aged 20 to 34 between 2000 and 2002 to pay rates among 20- to 34-years-old workers between 2010 to 2012.

Statscan says three factors have shrunk the traditional divide between high school and college grads. Alberta’s oil boom is one reason.

“Increases in economic activity fuelled by the oil boom of the 2000s―which raised demand for less-educated workers to a greater extent than it did for more-educated ones” accounted for part of the wage narrowing, Statscan said.

READ MORE: Migration to Alberta is exploding

Increases in minimum wage over time is another reason, the report said, with various provinces raising pay standards in recent years.

Lastly, the flood or “strong growth”, in the number of workers toting a three- or four-year university degree has helped dilute average wages among graduates.

Gulf remains

Yet to be sure, those years in college are still time well spent invested in future earnings potential — college grads still make more.

In the case of males, bachelor holders earn a third more on average than high school graduates, with the latter now making about 75 cents to every $1 earned by the former (up from 68 cents in the 2000-2002 period).

Women high school graduates meanwhile earned 68 cents for every dollar earned by a counterpart holding a degree, the study said.

Women still face wage discrepancies

Despite registering the biggest wage jump in the study, women with no education beyond high school still face the lowest wages.

And a significant driver of the group’s gains was governments raising minimum pay, Statscan said.

“Gains in real minimum wages accounted for about one-third of the narrowing of the wage differential among young women,” Statscan said.

“This was because young female high school graduates were more likely than their male counterparts to have hourly wages at or near the minimum wage rate.”

READ MORE: Where do you set the minimum wage?

Still, more women are attaining higher education.

Over the two periods examined in the report, the number of female degree holders surged by 42 per cent while the number of men with degrees jumped 30 per cent.

The employment rate among males with degrees was 7.4 percentage points more than high school diploma holders – up from 4.3 percentage points during the first period of the study.

For women, the gulf has widening even further.

In 2002, the employment rate for those with degrees surpassed the rate of those with a high diploma by 13.8 per cent, a difference that had grown to 18.6 per cent by the end of 2012.

© 2014 Shaw Media

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