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Graduating in Canada: Profile, Labour Market Outcomes and Student Debt of the Class of 2005
Section 2: Educational and labour market activities after graduation
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Graduates of postsecondary programs generally follow one of two pathways: either they opt to enter the workforce directly, or they choose to pursue further education. These choices may be influenced by a variety of factors, such as the perception of greater earning potential with a higher degree, family responsibilities, or current labour market conditions and availability of jobs. Some types of postsecondary programs prepare graduates for specific jobs, whereas others are more general, making the transition from school to work less straightforward. The following sections provide details on graduates pursuing further education after 2005, and the labour market outcomes of those who chose instead to enter the labour market immediately after graduation.
2.1 Further education
The National Graduates Survey data show that although most graduating students did not pursue further education immediately after graduation, more graduating students in the class of 2005 continued with their studies after graduation than those of the class of 2000.
Over one-third (36%) of the Class of 2005 pursued further education and this varied by level of study as shown in Chart 2.1. More bachelor level graduates pursued further education (42%) while a similar proportion of college and master level graduates did so (31% and 30% respectively). In contrast, a small proportion of doctorate level graduates pursued further education.
A higher proportion of the Class of 2005 graduates pursued further education than the Class of 2000 (36% versus 33% respectively). This increase was primarily attributable to the increased proportion of college graduates who continued their studies, up from 26% for the Class of 2000. In contrast, the proportion of doctorate graduates who pursued further education was lower for the Class of 2005 (8% versus 11% for the Class of 2000) while the proportions of bachelor and master graduates who pursued further studies increased slightly (Chart 2.1).
Chart 2.1 Percentage of graduates who pursued further education after graduation, by level of study
The proportion of graduates who pursued further studies varied by field of study. As shown in Appendix table A.2, at the college level, Humanities graduates were the most likely of all fields of study to pursue further education (77%), while at the bachelor and master levels, graduates in Physical and life sciences, and technologies were the most likely to continue after completing their studies (69% and 46% respectively). In contrast, at the college level, graduates of the Other health professions and related clinical sciences were the least likely to pursue further education (19%) as were graduates in Education at the bachelor and master levels (16% and 18% respectively).
2.2 Graduates in the workforce
The majority of graduates from the Class of 2005 (64%) did not pursue further studies in the two years following graduation and were able to enter the workforce directly. This proportion was slightly lower than that for the Class of 2000 (67%), even though the Class of 2005 was entering the labour market at a time when unemployment rates were decreasing (Chart 2.2) and work opportunities were opening up.
Chart 2.2 Unemployment rates by level of education, 25 to 44 year olds, 1990 to 2007
Trends from the Labour Force Survey show that those with postsecondary education fare consistently better in the labour market than do those with high school only (Chart 2.2). The National Graduates Survey provides further insight on the labour market outcomes of graduates; this section will explore these outcomes in terms of employment and earnings, by level of study, field of study, and gender.
2.2.1 Employment
Nine out of 10 college, bachelor, master and doctorate graduates who had not taken further education were working two years after graduation (Chart 2.3). A slightly lower proportion of college graduates were working full-time compared to graduates at other levels, while the proportion working part-time was similar among bachelor, master and doctorate graduates, at 7%.Employment rates were highest for master graduates
A higher proportion of both male and female graduates of master programs were working full-time in 2007 compared to college, bachelor or doctorate graduates. While the pool of master graduates increased in 2005 compared to 2000 for both males and females, the employment rate among master graduates remained stable for men at 94%, but increased for women, from 89% in 2002 to 92% in 2007 (see Appendix table A.3). Consequently, among master graduates, the gap in employment rates between women and men has nearly closed.
The proportion of women working part-time was more than twice that of men in 2007
More women than men were working part-time in 2007 at all levels of education. As shown in Chart 2.4, at the bachelor and master levels, the percentage of women working part-time was double that of men, and the difference was even greater at the doctorate level. The gap was largest among college graduates, however; 14% of female college graduates from 2005 were working part-time in 2007, compared to just 5% of males (see Appendix table A.3.)Chart 2.4 Proportion of 2005 graduates working part-time in 2007, by gender and level of study
Employment rates by field of study vary across levels of study
While variation in full-time versus part-time employment exists by level of education, there are also some differences by field of study. Graduates in certain fields are more likely to be employed than others at all levels of education; in other fields, employment rates are higher for those with a master or bachelor degree than for college graduates. The next section will examine employment rates by field of study.
It is difficult to identify consistent patterns in employment by field of study; rates of full-time employment do not necessarily increase by level of education within individual fields, and some fields have high employment rates only at one level, and lower rates at all others. Architecture, engineering and related technologies, however, is an example of a field of study in which a degree or diploma appears to lead directly to employment, regardless of the level – this field had one of the highest percentages of graduates working full-time in 2007 at all levels of education, ranging from 86% among college graduates to 93% among bachelor graduates (See Appendix table A.4).
As mentioned previously, overall, bachelor graduates had higher rates of full-time employment than college graduates. This was true for nearly all fields of study, with the exception of Visual and performing arts and communications technologies, the only field in which full-time employment was significantly higher among college graduates (77%) compared to graduates with a bachelor degree (71%).
Full-time and part-time employment rates varied within some fields of study by level of study. For example, nurses with a bachelor degree were far more likely to be employed full-time in 2007 than their counterparts at the college level – 86% compared to 72%, respectively – and the rate of part-time employment was nearly three times higher for nurses with a college degree. Despite these differences, nursing graduates had among the highest overall employment rates of any field – 96% at the college level, and 95% at the bachelor level (See Appendix table A.4).
Among all fields of study, college graduates in Education were the least likely to be employed full-time. Full-time employment among college graduates in the Education field fell from 75% in 2002 to 61% in 2007. The proportion of graduates in Education who worked full-time was higher for bachelor degree holders (77%), although the unemployment rate for college and bachelor degree holders was similar. This indicates that compared to college graduates in Education, the difference in employment for bachelor graduates was from part-time to full-time work, rather than from no work to full-time work. It should also be noted that the number of Education graduates at the bachelor level rose from 13,500 in 2000 to 16,400 in 2005, while the number of college graduates in Education decreased by more than half.
Growth in full-time employment two years after graduation between the Class of 2000 and 2005 varied by level of study and field of study
Growth in full-time employment among 2005 graduates compared to 2000 graduates varied greatly across education levels and fields of study (see Chart 2.5). In fact, at the college level, the rate of full-time employment actually fell in many fields between 2002 and 2007 – most notably Education, from 75% to 61%, as mentioned previously. At the bachelor level, full-time employment grew moderately for graduates from 2005 compared to graduates from 2000 in almost all fields. At the master level, full-time employment increased in some fields of study, while in others there were declines.1
2.2.2 Earnings
While it is important to know what degree of success graduates of various programs had in finding employment after finishing school, their earnings will give a more complete picture of how graduates are faring in the workforce. The following section examines graduates' earnings by level of education and field of study, as well as gender.
Earnings increased with education levels
While a relatively similar proportion of 2005 college, bachelor, master and doctorate graduates were able to find work two years after graduation, there were differences in terms of their earnings. The median annual earnings among those who were working full-time was lowest for college graduates at $35,000 and this increased to $45,000 for bachelor graduates, $60,000 for master graduates and $65,000 for doctorate graduates (Appendix table A.5). The largest earnings premium2 existed between the bachelor and master levels at 33% compared to a 29% earnings premium between the college and bachelor level and an 8% earnings premium between the master and doctorate levels.
Although earnings generally increased by level of study, there were large distributions of annual earnings within each education level. Consequently, some college graduates earned more than many bachelor graduates. For example, 25% of college graduates earned $44,300 or more annually while 50% of bachelor graduates earned $45,000 or less (Appendix table A.5).
Interpreting earnings
Information on earnings is for graduates working full-time who have not pursued or completed any further education since graduating in 2005. Readers should keep in mind when interpreting earnings results that there are many potential reasons for differences in earnings between graduates from different programs and different levels of education. For example, the results presented in this report do not necessarily reflect graduates' highest level of education, but simply the most recent; so a graduate could have a master degree completed previously, and a college diploma completed in 2005. This individual would be counted as a college graduate, even though his or her earnings might be more reflective of the master degree.
Male graduates had higher earnings than female graduates, at all levels of education
The difference in annual earnings by level of education differed for males and females who were working full-time (Chart 2.6). For females, the median earnings increased by level of education. For males, the median earnings increased from the college to bachelor level and from the bachelor to master level but stayed the same between the master and doctorate levels.
Across all levels of education, males typically earned more than females (Chart 2.6). Furthermore, as the earnings level (percentile) increased, the gap between the genders increased as well – at least among college, bachelor and master graduates. At the doctorate level, the difference between male and female earnings still existed at the median and the 75th percentile, but was narrower than at other levels of education. At the 25th percentile, however, earnings of female doctorate graduates actually exceeded those of males by $2,400. The largest earnings gap between the genders was at the master level, at the 75th percentile, where gross earnings for males exceeded those of women by $13,000. This pattern did not change from five years before.
Earnings varied by field of study as well; however, further discussion of graduate earnings by field of study should be done with education level in mind, since earnings distributions across fields are very different at the college, bachelor, master and doctorate levels. Charts 2.7.1, 2.7.2, 2.7.3, and 2.7.4 show these distributions for each level. Appendix table A.6 contains complete information on earnings by field of study.
Among college graduates, typical (median) earnings were highest for those graduating from Architecture, engineering and related technologies and lowest for those graduating from Social and behavioural sciences, and law. Among bachelor graduates, typical earnings were highest for those graduating from Health, parks, recreation and fitness and lowest for those graduating from Visual and performing arts, and communications technologies. At the master level, a typical graduate from Personal, protective and transportation services earned more than typical graduates from other fields of study and almost three times the earnings of a typical graduate from the field of Visual and performing arts, and communications technologies, which was the field with the lowest median earnings. Doctorate graduates in Business, management and public administration had the highest median earnings, almost twice that of doctorate graduates in Physical and life sciences, and technologies, who had the lowest median earnings.
Looking at earnings distributions within various fields of study (the range between the highest and lowest earners in a given field), some fields of study, such as Nursing, had narrower earnings distributions while others, such as Humanities, had wider distributions. The field of Humanities stands out at the college level: the highest-earning graduates of college-level Humanities programs made more than twice as much as their counterparts at the lowest-earning end of the spectrum (in dollar figures, this corresponds to $25,000 at the 25th percentile and $53,000 at the 75th percentile.) At the bachelor and master levels, the difference between highest and lowest earners in Humanities was less pronounced, though still among the highest of all fields of study. Among doctorate graduates, however, it was the lowest.As mentioned previously, earnings increased with education levels. Generally this was also the case when examined by field of study. While graduates' earnings in 2007 in most fields followed the overall pattern of increasing with higher levels of education, some fields showed the greatest benefit at the master level, while in others, the largest increase occurred at the bachelor or the doctorate level. For instance, Education graduates at the bachelor level earned 42% more in 2007 than graduates from college-level Education programs ($31,700 at the college level, compared to $45,000 at the bachelor level); at the doctorate level, graduates in the field of Visual and performing arts, and communications technologies, earned almost twice as much as those with a master degree in that field ($37,500 among master graduates, $69,000 for doctorates).
Comparing earnings two years after graduation between the Class of 2000 and 2005 showed that median earnings increased among graduates of some fields while decreasing in others
At the aggregate level, graduates' earnings increased at all levels of education from 2002 to 2007, but only slightly, between 1% and 4%. Median earnings for graduates of Education programs at all levels increased from five years before (in constant dollar terms). On the other hand, earnings among graduates of Mathematics, computer and information sciences programs decreased, regardless of the level of education (from college to doctorate graduates).
Among doctorates, graduates of traditionally male-dominated program areas (Physical and life sciences and technologies, Mathematics, computer and information science, and Architecture, engineering and related technologies) were earning less in 2007 compared to the previous cohort (2000 graduates interviewed in 2002, with earnings expressed in constant dollar terms.) On the other hand, graduates of doctoral programs in Education, Business, management and public administration, and Agriculture, natural resources and conservation, were earning more.
Summary
The 2007 NGS showed that a lower proportion of graduates from the Class of 2005 entered the workforce after graduation compared to the Class of 2000, despite favourable labour market conditions. Among those who did not take further education, employment rates two years after graduation were high across all levels of study, ranging from 90% for college to 93% for master graduates.
While a relatively similar proportion of 2005 college, bachelor, master and doctorate level graduates were able to find work two years after graduation, there were differences in terms of their earnings. The largest earnings premium existed between the bachelor and master levels suggesting that investing in further post-graduate work is financially beneficial. On the other hand, the earnings premium between a master level and doctorate level suggests that the monetary gain from employment two years after graduation for doctorate students is marginal. A further follow-up survey, which will occur five years after graduation, will reveal whether earnings premiums among education levels change over the long-term.
Labour market outcomes varied by gender. Female graduates were more likely to be working in part-time jobs at all levels of education compared to males, and those who were working full-time generally earned less. The NGS can be used to identify whether more women are choosing to work part-time, or if full-time employment is less readily available in fields where the majority of graduates are women. Additionally, the NGS could be used to identify whether earning differentials among full-time workers are a result of differences in fields of study or occupation choices.
While this report does not go into detail on labour market outcomes by field of study it does reveal that the distribution of earnings varies greatly across fields of study and also varies within fields of study by level of education. Data from the NGS could explore the relationship between fields of study and occupational choices and the impact this has on labour market outcomes.
Notes
- At the doctorate level it is difficult to draw comparisons, since many of the employment figures from 2002 had to be suppressed for confidentiality reasons.
- The term 'earnings premium' refers to the increase in average (median) earnings from one level to the next; so in other words, master graduates earn on average 33% more than bachelor graduates.
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