The Cumulative Earnings of Postsecondary Graduates Over 20 Years: Results by Field of Study
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by Yuri Ostrovsky and Marc Frenette
Social Analysis and Modelling Division
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This article in the Economic Insights series reports on the cumulative earnings over a 20-year period of college and bachelor's degree graduates from different fields of study. This article is part of a program at Statistics Canada that examines various dimensions of labour market outcomes of postsecondary graduates.
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When students graduate from high school, they make at least two educational decisions that affect the rest of their lives. The first is whether to pursue a higher level of education. The literature clearly demonstrates that postsecondary graduates tend to fare better in terms of labour force participation, unemployment, and earnings than do people with less education.
Students who choose to enter a postsecondary program must make a second decision: what to study. Canadian evidence on labour market outcomes by field of study is limited. Research has generally been based on cross-sectional informationNote 1 or on longitudinal data with limited scope;Note 2 until recently, national-level data have not been available to observe and quantify long-term cumulative outcomes associated with education. However, with the development of new, national longitudinal administrative data, this is now possible. A recent study, in fact, found considerable differences in cumulative earnings across levels of educational attainment.Note 3
This study extends that research by examining the cumulative employment earnings of graduates of different fields of study over a 20-year period. Employment earnings include paid wages and salaries, as well as net proceeds from self-employment. The analysis is based on a sample of 15,166 college and bachelor’s degree graduates who were aged 26 to 35 in 1991. Information about their level of education and field of study was obtained from their responses to the 1991 Census long questionnaire; information about their employment earnings over the subsequent 20 years was taken from their T1 Income Tax Returns.Note 4 This study documents three aspects of earnings by field of study: (i) differences in median cumulative earnings across fields of study; (ii) the distribution of cumulative earnings within fields of study; and (iii) the trajectories of annual median earnings within fields of study over the life course of graduates.
Cumulative earnings vary by level and field of study
Bachelor’s degree and college graduates earned considerably more than did high school graduates. From 1991 to 2010, the median cumulative earnings (expressed in 2010 constant dollars) of male high school graduates amounted to $882,300 (Table 1). In comparison, male college graduates earned about 1.3 times more ($1,137,000), and male bachelor’s degree graduates earned about 1.7 times more ($1,517,200).
|Bachelor's degree||College certificate||High school diploma||Bachelor's degree||College certificate||High school diploma|
|2010 constant dollars|
|Education||1,290,400||996,600||Note ...: not applicable||1,044,600||513,500||Note ...: not applicable|
|Fine and Applied Arts||843,900||807,200||Note ...: not applicable||652,100||437,300||Note ...: not applicable|
|Humanities||1,144,600||827,500||Note ...: not applicable||808,200||555,900||Note ...: not applicable|
|Social Sciences||1,358,900||1,241,500||Note ...: not applicable||824,300||563,800||Note ...: not applicable|
|Business Administration||1,619,400||1,099,500||Note ...: not applicable||1,169,100||625,100||Note ...: not applicable|
|Life Sciences||1,334,700||753,500||Note ...: not applicable||844,900||502,300||Note ...: not applicable|
|Engineering||1,845,000||1,244,200||Note ...: not applicable||972,600||718,800||Note ...: not applicable|
|Health||1,627,600||1,089,700||Note ...: not applicable||1,094,000||812,800||Note ...: not applicable|
|Mathematics and Physical Sciences||1,607,500||1,128,000||Note ...: not applicable||1,148,700||793,800||Note ...: not applicable|
|All fields of study||1,517,200||1,137,000||882,300||972,500||643,200||458,900|
... not applicable
Sources: Statistics Canada, 1991 Census–Longitudinal Worker File and CANSIM table 326-0021.
Although women generally earned less than men did, the patterns were similar. Women with a bachelor’s degree earned $972,500 (about 2.1 times more than high school graduates), and those with a college certificate earned $643,200 (about 1.4 times more than high school graduates).
Postsecondary graduates’ earnings also varied considerably across fields of study. For example, men with a bachelor’s degree in Engineering earned $1,845,000 over the period, more than twice as much as Fine and Applied Arts graduates, who earned $843,900. Men with a bachelor’s degree in Business Administration, Health, and Mathematics and Physical Sciences were also top earners; those who graduated with a degree in Humanities ranked relatively low (second behind Fine and Applied Arts graduates).
The findings were generally similar for women with a bachelor’s degree. Top earners again included those who graduated from Business Administration, Mathematics and Physical Sciences, Health, and Engineering. A notable difference between men and women was the relative ranking of Education graduates. Among men, they ranked seventh out of the nine fields. Among women, they ranked fourth—just behind Health graduates and slightly ahead of Engineering graduates. As was the case with male bachelor’s degree graduates, the lowest earners among women with a bachelor’s degree were those who had studied Fine and Applied Arts.
Male and female college graduates of Fine and Applied Arts programs also ranked near the bottom based on median cumulative earnings (second lowest among men; lowest among women).
For men and women with a college certificate, top earners included graduates of Engineering, Health, Mathematics and Physical Sciences, and Business Administration (as was the case for bachelor’s degree graduates). Interestingly, male college Social Sciences graduates ranked second in median cumulative earnings (just behind Engineering graduates). In contrast, the median cumulative earnings of men with a bachelor’s degree in Social Sciences were well below the median for all fields of study.
Cumulative earnings also vary substantially within each field
Even if students select the same field of study, their long-term earnings can be quite different. This may be the result of factors such as hours of work, occupation, industry, access to employment networks, abilities and random luck—information not available in the administrative data used in this analysis. Nonetheless, quantifying variability within fields provides perspective on long-term earnings prospects.
To do this, men and women with a college certificate or a bachelor's degree in each field were ranked from lowest to highest in terms of their cumulative earnings. Their “normalized” cumulative earnings are shown in Tables 2 and 3 at the 10th percentile (P10), 25th percentile (P25), median or 50th percentile (P50), 75th percentile (P75), and 90th percentile (P90). Normalized values are expressed relative to the median for all fields combined. The ratios of cumulative earnings of individuals at the 75th and 25th percentiles (the P75/P25 ratio) and at the 90th and 10th percentiles (the P90/P10 ratio) were used as measures of earnings variation within disciplines.
|normalized valueNote 1||ratio|
|Fine and Applied Arts||0.15||0.24||0.56||0.89||1.09||3.77||7.54|
|Mathematics and Physical Sciences||0.52||0.80||1.06||1.46||2.61||1.82||5.02|
|All fields of study||0.45||0.71||1.00||1.37||2.19||1.94||4.89|
|Fine and Applied Arts||0.08||0.30||0.67||1.05||1.33||3.51||16.17|
|Mathematics and Physical Sciences||0.29||0.70||1.18||1.53||2.01||2.19||6.85|
|All fields of study||0.29||0.58||1.00||1.36||1.69||2.34||5.87|
|normalized valueNote 1||ratio|
|Fine and Applied Arts||0.28||0.47||0.71||1.11||1.44||2.36||5.16|
|Mathematics and Physical Sciences||0.35||0.64||0.99||1.37||2.13||2.15||6.09|
|All fields of study||0.38||0.68||1.00||1.36||1.71||2.00||4.46|
|Fine and Applied Arts||0.10||0.31||0.68||1.11||1.51||3.54||14.97|
|Mathematics and Physical Sciences||0.34||0.74||1.23||1.68||2.46||2.25||7.19|
|All fields of study||0.21||0.53||1.00||1.46||1.93||2.77||9.43|
There was considerable earnings variation in cumulative earnings in every discipline, as evidenced by the P75/P25 and the P90/P10 ratios. The P75/P25 ratio ranged from about 1.6 (registered by men with a bachelor’s degree in Education) to about 3.8 (men with a bachelor’s degree in Fine and Applied Arts). The P90/P10 ratio ranged from about 2.7 (men with a bachelor’s degree in Education) to about 16.2 (women with a bachelor’s degree in Fine and Applied Arts).
In general, the variation in cumulative earnings within fields of study was higher among women. This was largely attributable to lower earnings at the bottom of the distribution, both in an absolute and a relative sense.
An alternative way to visualize the variability in cumulative earnings within and across fields of study is through a three-dimensional chart. For instance, Figure 1 pertains to men with a bachelor’s degree. The fields are sorted from left to right in descending order of cumulative earnings at the 90th percentile.
The “very high” earners (those whose cumulative earnings amounted to at least $2,500,000 over the 20-year period—an annual average of at least $125,000) are at the top (90th percentile) of the distributions in five fields: Business Administration, Mathematics and Physical Sciences, Engineering, Social Sciences, and Health. The cumulative earnings of men at the 90th percentile of the distribution of Business Administration graduates amounted to slightly more than $4,000,000 over the period. This means that about 10% of male graduates with a bachelor’s degree in Business and Administration had average annual earnings of $200,000 or more during the two decades.
Some graduates in other fields who were above the 90th percentile in their respective discipline may also have been “very high” earners (cumulative earnings of more than $2,500,000). However, the earnings of graduates of these disciplines (even those at the 90th percentile) were comparatively low. For example, the cumulative earnings of men with a bachelor’s degree in Education and Fine and Applied Arts who were at the 90th percentile amounted to about $1,700,000 over the 20-year period.
At the opposite end of the spectrum, men at the 10th percentile of the earnings distribution of Fine and Applied Arts graduates earned $222,300 (an annual average of $11,015). Men at the 10th percentile of Humanities graduates earned $311,700 ($15,585 per year).Note 5
Similar findings are evident for women with a bachelor’s degree (Figure 2). Although the ordering of disciplines at the 90th percentile is slightly different, the highest earners were once again from Business and Administration, Mathematics and Physical Sciences, Engineering, and Health. The lowest earners at the 10th percentile were from Fine and Applied Arts and Life Sciences graduates.
Absolute change in median annual earnings similar in most fields
Graduates of the various disciplines likely bring unique skills to the labour market, which may be valued or rewarded differently over time. For example, technical skills may yield greater returns early in one's working life when an individual is at the forefront of the most recent technology; interpersonal skills may yield greater returns at later stages when individuals move into supervisory or managerial positions. Although such factors could have implications for the earnings trajectories of graduates of different fields of study, this is not the case when median annual earnings are tracked through the study period.
Real median annual earnings at the beginning (1991) and end (2010) of the study period are shown in Table 4. Also shown is the change between these two years.
Within each sex and education category, most fields experienced similar absolute changes in median annual earnings over the period. Among men with a bachelor’s degree, the absolute change in median annual earnings ranged from $25,000 to $31,000 in six out of the nine fields of study. Similarly, among women with a bachelor’s degree, the absolute change in median annual earnings ranged from $20,000 to $28,000 in six out of the nine fields of study. Among college graduates, the absolute changes in median annual earnings were even more consistent across disciplines. Note that the relative changes in median annual earnings (not shown in the table) tended to vary more across fields given the large variation in median annual earnings at the beginning of the period.
|Bachelor's degree graduates||College graduates|
|2010 constant dollars|
|Fine and Applied Arts||22,900||42,000||19,100||34,800||42,500||7,700|
|Mathematics and Physical Sciences||61,900||90,000||28,100||50,900||65,000||14,100|
|All fields of study||57,400||87,800||30,400||47,600||63,900||16,300|
|Fine and Applied Arts||21,300||34,200||12,900||13,400||26,600||13,200|
|Mathematics and Physical Sciences||46,900||67,100||20,200||36,000||46,800||10,800|
|All fields of study||38,500||64,100||25,600||26,400||39,600||13,200|
|Sources: Statistics Canada, 1991 Census–Longitudinal Worker File and CANSIM table 326-0021.|
A number of key findings emerge from this analysis of the 20-year cumulative earnings of postsecondary graduates by field of study. The first is the considerable variability in median cumulative earnings by level and field of study. Second, even within each field, graduates’ earnings varied substantially. Third, the change in median annual earnings was similar for graduates of most fields over the 20-year period.
Finnie, R. and M. Frenette. 2003. “Earnings Differences by Major Field of Study: Evidence from Three Cohorts of Recent Canadian Graduates.” Economics of Education Review 22 (2): 179–192.
Frenette, M. 2014. An Investment of a Lifetime? The Long-term Labour Market Premiums Associated with a Post-secondary Education. Analytical Studies Branch Research Paper Series, no. 359. Statistics Canada Catalogue no. 11F0019M. Ottawa: Statistics Canada.
Heisz, A. 2003. Cohort Effects in Annual Earnings by Field of Study Among British Columbia University Graduates. Analytical Studies Branch Research Paper Series, no. 200. Statistics Canada Catalogue no. 11F0019M. Ottawa: Statistics Canada.
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