The Role of University Characteristics in Determining Post-graduation Outcomes: Panel Evidence from Three Recent Canadian Cohorts
by Julian Betts, Christopher Ferrall and Ross Finnie
Business and Labour Market Analysis Division
Analytical Studies Branch Research Paper Series, No. 292
Context
A major role of universities is to prepare their students for success in the labour market after they graduate. Surprisingly, we know very little about how universities' educational policies influence the success of their students. From a policy perspective, the role of field of study and university characteristics in determining labour market success of graduates is a compelling issue. Direct spending on education is one the largest items in government budgets and one of the largest investments made by individuals and their parents. It feeds indirectly into both public and private budgets through productivity gains, earnings power and the tax base. How should scarce funds be spent to foster successful post-graduation outcomes?
Objective(s)
This paper examines how graduates of Bachelor's programs in Canadian universities have fared in the labour market. The specific goal is to test whether given types of educational spending in Canadian universities are helpful in increasing students' earnings five years after graduation. In addition it tests for a link between the probability of employment for the same length of time.
Findings
Within universities, changes over time in various characteristics are correlated with changes in graduates' earnings. Increases in undergraduate enrolment are associated with declines in subsequent earnings for graduates, suggesting crowding out. For men, but not women, increases in the professor – student ratio are associated with meaningful gains in students' subsequent earnings. Models that do not condition on a student's major show increased effects of changes in a university's characteristics, with estimated effects rising up to almost two-fold. For women in particular, changes in several university characteristics are strongly associated with changes in women's choice of major. Changes in university characteristics are not strongly related to the probability of employment five years after graduation.
Data source(s)
The paper uses the data set of 1982, 1986 and 1990 waves of the National Graduates Survey (NGS).
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