Work experience can trump more schooling

by ROMA LUCIW — November 1, 2007

Some Canadian university graduates earned less than high-school dropouts in their first few years in the labour market, in part because the grads have spent less time getting valuable experience, according to a Statistics Canada study.

A poll of Canadians aged 22 to 24, conducted in December, 2003, pinpointed the median earnings at $503 a week. Not surprisingly, people who had attained a college or university degree earned more than the median, while those who dropped out of high school or had not completed a post-secondary program earned less than the median.

However, the poll found that at least some university grads - albeit a minority - were bringing home smaller paycheques than high school dropouts of their age.

“Part of the reason for this is that university graduates would have had less time in the labour market to gain work experience—and the accompanying earnings premium—than youth who had dropped out before completing high school,” said the study's co-authors, Darcy Hango and Patrice de Broucker.

In addition, young Canadians with a post-secondary education might be in financial squeeze, they said. “On the one hand, they may have increased debt associated with their postsecondary experience, while on the other hand, they may have increased opportunity costs associated with not being employed during the time when enrolled.”

Mr. Hango stressed that this study looked only at very early labour experience. “So we don't know what will happen to these people as they progress through their working career.”

The Statscan study found that young men were more likely to drop out of high school than young women, and more likely to delay the start of a post-secondary program. Young women were more likely to go on to some type of postsecondary program before getting into the labour force.

One major factor driving the high-school dropout rate was grades.

“Marks matter,” the Statscan analysts wrote. “Youth with very low marks in high school were much more likely than those with average to high marks to drop out and not return. Very high marks predicted that the teen would go directly to a postsecondary program after high school rather than delaying.”

Among the study's other findings:

- Young people of Aboriginal descent were more likely than non-Aboriginal youth to leave the educational system early.

- Not living in a two-parent family increased the risk of not finishing high school, as did having a greater number of siblings

- Young people with highly educated parents were more likely to get a postsecondary education

- Working some hours in high school can be beneficial, while working more than 20 hours a week can lead to a greater risk of dropping out of high school

- People who had a child or entered a conjugal union during their teenage years were more likely to drop out of high school

- Higher parental expectations regarding their child's education were linked to higher educational attainment.

Read the Statscan Report

Source:Globe and Mail