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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