Education pays: New study shows average salaries by degree, diploma
A University of Waterloo sign is seen in this image from the school's Facebook page. (University of Waterloo)
Published Tuesday, July 26, 2016 4:20PM EDT
New research shows that Canadian post-secondary education pays off big time -- even for the much-maligned arts graduates -- although there are huge differences in salaries depending on the credential.
The Education Policy Research Initiative study is perhaps the most comprehensive ever undertaken in Canada. It looked at tax records for about 340,000 students from 14 Canadian colleges and universities and tracked earnings over eight years.
The researchers found that 2005 bachelor’s degree graduates had average annual earnings of $45,200 in their first year of work, and their average salaries grew by 66 per cent over eight years, hitting $74,900.
For 2005 college diploma graduates, average earnings started at $33,900 and grew to $54,000 eight years later -- a 59-per-cent increase.
The research also confirmed what many suspect: average salaries vary widely based on the type of credential earned, with fine arts and humanities paying the least and math, computer science and engineering paying the most.
But the study’s authors also point out that even humanities and fine arts graduates earn far more than the $22,000 earned by the average coffee shop employee, which they say counters the popular myth of the “barista with a B.A.”
In inflation-adjusted dollars, here are the average salaries that 2005 bachelor’s graduates were earning eight years later:
Engineering -- $99,600
Math and computer science - $89,300
Business graduates -- $81,400
Science and agriculture -- $68,700
Health -- $68,300
Social sciences -- $61,900
Humanities -- $57,000
Fine arts -- $45,100
In inflation-adjusted dollars, here are the average salaries that 2005 college diploma graduates were earning eight years later:
Engineering -- $71,900
Personal, protective and transportation services – $51,900
Sciences and agriculture -- $49,700
Health -- $49,300
Business -- $47,300
Arts and education -- $41,500
Fine arts -- $41,100
The study also looked at whether salaries were affected by the 2008 recession. The researchers found that graduates from the classes of 2008 to 2011 were only moderately affected.
Huge gender gap
The study also observed a huge gender gap in earnings over time. It started small – a six per cent gap for bachelor grads in 2005 ($46,800 versus $44,000) but grew by 44 per cent over eight years, with men averaging $89,900 versus women’s $62,500.
The authors suggest that this may be due to the fact that men are more likely to work in higher paying industries like engineering, while women may choose to work fewer hours or face labour market discrimination. They say the question needs more research.