Cohort effects in annual earnings by field of study among British Columbia
university graduates
by Andrew Heisz
Business and Labour Market Analysis
Division
Analytical Studies Branch research paper series, No. 200
Graduates
from applied fields, such as engineering, commerce, and the health professions
tend to earn higher incomes, on average, than those in other disciplines. There
is a sense that as a result of technological change, the demand for graduates
in technology-related fields, in particular, is rising. As a result, their relative
wages may also be rising, increasing the earnings gap between them and other graduates.
This
study found no evidence of a widening gap: the relative differences in earnings
among fields of study did not change in favour of applied degree holders in more
recent groups of graduates.
Among men, there was no increase in the earnings
gap in favour of graduates from engineering, commerce or medical sciences compared
to graduates from humanities, social sciences or sciences.
The study noted
an increase in relative earnings for women from engineering and rehabilitation
medicine. However, this increase may have been related to greater annual hours
of work among female labour force participation, rather than an increase in their
wage premiums. There was no increase in relative earnings for women from other
applied fields like commerce, teacher training, nursing or medical sciences.
There
are two possible explanations for the stability in relative earnings found by
this study. First, technological change may have increased demand for university
graduates with applied degrees, but the rising supply of graduates with applied
degrees offset this demand. Second, technological change may have affected demand
for all types of university degrees equally. In either case, there is no evidence
that the rising demand for skills associated with technological change has driven
up the earnings of applied graduates.
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