It is starting to get dark at night again, a sure sign that you need to decide what you want to do this winter.
For many young Yukoners, a big question is whether to pursue post-secondary education. And, if the answer is yes, what to study.
Recently, after pitching my tent with a nice view of the Samuel Glacier, I ran into a number cruncher from Ottawa who had compiled some fresh insights on the question.
It just goes to show the Yukon is a great place for economists. You can enjoy a good hike without missing the chance to talk statistics.
It’s also useful information for young people. Life choices aren’t all about money, of course, but it is useful to have a few facts when dealing with the contradictory (and often fact-free) advice they get from older folk around the family dinner table.
Kaveh Afshar, the hiking statistician, and his team from the Education Policy Research Initiative (EPRI) have linked data from 14 universities, Statistics Canada and the federal tax people. They can finally answer with authority that age-old question: which degrees are likely to set you up with better paying careers?
This seems like an easy question, but with privacy laws and the data scattered across various organizations it has been quite hard to answer. I haven’t seen data like this in Canada before.
The EPRI team looked at people who graduated with bachelor degrees from the 14 universities in 2005 and tallied up how much they earned in the following eight years. It turns out that engineering grads earned the most, averaging a total of $636,600 over the period. The average engineering grad earned $56,400 the year after graduating, but had nearly doubled that to $99,600 eight years later.
The other top categories were math and computer science ($562,800), health ($519,900) and business ($515,700). Interestingly, math and computer science as well as business grads saw their annual earnings grow over 80 percent during the eight years following graduation.
Health grads, on the other hand, started high but grew just 16 percent over eight years. I don’t know why this is, but it may be linked to a greater percentage of them being in government jobs with strictly programmed pay levels.
Meanwhile, the lowest paying category was Fine Arts. Grads here earned $301,700 over the eight years. Your columnist’s history and economics double major fell into the next two lowest earning categories: humanities ($367,700) and social sciences ($413,200).
Clearly the labour market doesn’t value an understanding of the constitution of the Roman republic or Pareto optimality as much as it should.
The data also show interesting patterns between men and women. One year after graduation, the earnings are quite similar between the genders. Indeed recent female graduates make more money in humanities and health, and are roughly equal in math and computer science. However, eight years later, the men earned more on average in all the categories; sometimes by margins as large as $20,000 a year. This is an area where a quality dataset like EPRI’s could improve our understanding about why this is.
I asked Afshar what young people should take away from all these numbers. He said that it shows that post-secondary education is worth more than many people think. These graduates are not working in stereotypical post-college jobs that have “poor earnings,” he said. “They do well although that varies across fields. But they [should] think twice before they decide [post-secondary education] is not worth it.”
It’s worth noting that other data shows that having a university degree does not always pay more than a trade or being an entrepreneur. Bill Gates and Steve Jobs did fine without a bachelor degree. So did my father and grandparents. Workopolis, a jobs website, points out a number of job categories such as air traffic controller, web developer and nuclear reactor operator that can pay over $100,000 a year without a university degree. However, Statistics Canada data shows that on average university graduates tend to earn more and have lower unemployment rates.
Elizabeth Bennett in Pride and Prejudice remarked that it was best to marry for love, but that it was a little bit easier to love someone who was rich. Careers are similar. You will probably be happier if you are passionate about your work, but you will probably earn more if you can be passionate about mechanical engineering rather than Roman history.
The numbers are useful even if you’ve already decided what to study. They can help a graduate do a rough budget for the first ten years after graduation. It’s much easier to pay off student loans with an engineering degree rather than a humanities degree. Students should know that before they take advantage of student loan programs.
Just because someone will lend you the money doesn’t mean you are wise to borrow it. Regrettably, the consequences may be trimming the budget and putting up with that annoying roommate a bit longer. Fortunately, Yukon students have the Yukon Grant to help.
I have one more bit of advice, particularly for anyone studying engineering, math or business. Take a Roman history course. It will broaden your horizons and make you think a bit differently. That’s what university is really for.
Keith Halliday is a Yukon economist and author of the MacBride Museum’s Aurore of the Yukon series of historical children’s adventure novels. He won last year’s Ma Murray award for best columnist.