NEWS
04/28/2014 05:52 EDT | Updated 06/28/2014 01:59 EDT

Wage Gap Between High School Grads And Degree Holders Narrows

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The gap between the earnings of a college or university degree graduate and what someone with a high school diploma makes is narrowing, Statistics Canada research released today shows.

The gap between the earnings of a college or university degree graduate and what someone with a high school diploma makes is narrowing, Statistics Canada research released today shows.

According to the data agency, high school grads are making wage gains, while the earnings of holders of a post-secondary school degree are staying flat.

The federal agency's analysis of data compares earnings for the two groups in two different time periods — in 2000 to 2002, and then between 2010 and 2012.

The results were counter-intuitive, in that education didn't lead to greater wage gains.

Between those two periods, men aged 20 to 34 whose highest level of education was a high school diploma saw their salaries increase by nine per cent. Women in the same group saw a rise of 11 per cent.

"In contrast, the average real hourly wages of young male bachelor's degree holders was unchanged, while those of young female bachelor's degree holders increased by five per cent," Statistics Canada said.

College degree holders still earned more than  their lesser-educated peers, but not by as much as during the previous period.

For every $1 a male degree holder earned between 2010 and 2012, a high school grad earned 75 cents. That's up from 68 cents a decade earlier. Meanwhile, a female fresh out of high school earned 74 cents for every dollar a college or university degree holder earned a decade ago, but 10 years later, that ratio increased to 78 cents per dollar.

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Statistics Canada says one possible cause for the unexpected finding could be Alberta's oil boom, which has been driving up demand for unskilled labour.

"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 roughly one-fifth of the narrowing wage differentials among young men and young women," the data agency said.

In recent years, many provinces have moved to increase their minimum wages, and that trend was clearly visible in the data.

About a third of the narrowing of the wage gap for women was directly attributable to that, while on the men's side, there was virtually no impact.

"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," the data agency said.

More college grads employed

High school grads may be doing comparatively better in terms of salary growth, but as a whole, fewer people are sticking with just a high school diploma, and not going on for more education

There were 42 per cent more women with bachelor's degrees over the decade studied, compared with only five per cent more high school grads. On the men's side, there were 30 per cent more college degree holders, and 16 per cent more high school grads.

Individuals with a higher education were also still much more likely to have a job in the first place.

"While the full-time employment rate of young women with a bachelor's degree remained around 63 per cent," Statistics Canada said, "the rate for young women with a high school diploma declined from 49 per cent to 44 per cent." 

"Likewise, the full-time employment rate of young men with a high school diploma fell from 68 per cent to 61 per cent over the decade, while their counterparts with a bachelor's degree saw their employment rate drop from 72 per cent to 68 per cent.

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