The returns to education and the increasing
wage gap between younger and older workers
by Constantine Kapsalis, René
Morissette and Garnett Picot
Business and Labour Market Analysis Division
Analytical
Studies Branch research paper series, No. 131
Using a regression decomposition
approach, we find that, during the 1980s, the growth in the relative educational
attainment of older workers has contributed to about one-quarter of the increase
in the age-wage gap of men and women. During the 1990s, the age-wage gap increased
to a much lesser extent. Changing relative educational attainment accounted for
a much greater proportion of the much smaller increase in the gap: almost one-half
for males and over three-quarters for women.
We also find that, during
the 1980s, the expected weekly wages associated with all levels of education fell
for younger workers, both for men and women (from 2% to 16%, depending upon education
level). Older employees, on the other hand, experienced mixed results. Expected
weekly wages rose for some older workers and fell for some others.
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the full publication.
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