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By Katherine Marshall
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Most postsecondary students depend on earnings from a job to cover some of the cost of their education. However, whether young workers are at school or not, youth employment can be particularly affected by economic downturns. Between October 2008 and October 2009, employment declined by about 10% among those age 15 to 24, representing 225,000 jobs and more than one-half of the total job loss during this time (LaRochelle-Côté and Gilmore 2009). With lower levels of seniority, job permanency and job protection, young workers are often the first to be laid-off. Finding a job is also more difficult as many have little or no previous work experience, even if credentials are strong.
While postsecondary students report that personal savings is the most common source of income to fund their education (79%), income from employment is ranked second (63%) (Ouellette 2006). More than one-half of students report that either savings (27%) or earnings (26%) provide the largest amount of money towards the total cost of their school year. As youth unemployment rises during economic downturns, these important sources of student income decline, which can lead to increased borrowing. “Based on previous recessions, an increase of each 1% in the rate of youth unemployment appears to lead to an increase of just over 6% in the number of student loan borrowers” (Usher and Dunn 2009). Higher student borrowing rates and debt have been linked to lower savings, investments and asset levels well after graduation (Luong 2010).
Tuition fees have risen at a faster rate than inflation since the early 1990s (Ouellette 2006). Some researchers expect the economic downturn to present a number of challenges for postsecondary institutions: decreasing revenues; increasing costs; increasing enrolment in colleges and postgraduate studies; and increasing student aid costs (Usher and Dunn 2009). According to this scenario, students would be facing increased costs and competition for certain programs as their employment prospects fade.
Recently, more high school and postsecondary students have been working during the school year and spending more time at their jobs than in the past (Usalcas and Bowlby 2006). These findings highlight the question of whether in-school employment is a positive, negative or benign activity. Many studies have attempted to assess the impact working has on academic performance, the amount of time taken to complete studies, student retention and personal stress levels (for recent examples see DeSimone 2008, Motte and Schwartz 2009, Riggert et al. 2006, and Vickers et al. 2003). Most deduce that long hours can interfere with student outcomes, but the findings are less conclusive with regard to low and moderate levels of labour market involvement. Analyzing the school/employment relationship is complicated because of unobservable variables such as personal motivation, time management and organizational skills, and self-confidence.
This study uses the Labour Force Survey (LFS) to examine long-term school-year employment trends among youth age 15 to 24 enrolled full time in community college, Collège d'enseignement général et professionnel (CEGEP) or university, with particular focus on the recent downturn and nascent recovery (see Data source and definitions). This is followed by a descriptive profile of the students who had a job in the 2009/2010 school year, including their average hours of work, average earnings and job characteristics. Information is also provided on long-term employment trends during the summer months (see A summer job).
In 1976/1977, 12% of all youth age 15 to 24 (532,000) were attending some form of postsecondary education on a full-time basis—a proportion that has steadily increased over the decades. In the 2009/2010 school year, 27% (1,193,000) of all youth were full-time postsecondary students attending community college, CEGEP or university. The increased participation in postsecondary education is tied to the rise in the knowledge-based economy and the demand for higher-skilled jobs. Another well-known trend is the increasing participation rate of young women in higher education vis-à-vis men. In 1976/1977, women represented 46% of all youth attending postsecondary school and, by 2009/2010, they represented 56% of all such students (Table 1). The proportion of full-time postsecondary students attending university has increased slightly, up from 57% in 1976/1977 to 61% in 2009/2010. Women in particular have gravitated towards attending university.
Not only has the postsecondary school attendance rate increased among youth, but so too has the proportion who combine school and paid work. Over the past 35 years, the employment rate among full-time postsecondary students increased from approximately one in four to just under one in two (Chart A). On the other hand, the summer employment rate for this population has remained stable (see A summer job). Since the early 1990s, a noticeable difference in employment activity has emerged between men and women, with female students participating at a higher rate than male students. The employment rate difference has continued to widen over the past decade reaching a double-digit difference for the first time in 2004/2005, with 52% of full-time female students having a paid job during the school year compared with 41% of full-time male students. The gender employment trend is also evident among younger and older students (Table 6) and has also been noted in previous research using time use data (Marshall 2007).
There was a significant drop in the employment rate for all students between 2007/2008 and 2009/2010—down by 2.6 percentage points for male students and 2.4 points for female students. However, on a term-by-term basis it is obvious that the economic downturn, which started in late 2008, had a large initial impact on the employment opportunities of postsecondary students, but since then there have been signs of improvement (Chart B). Although the employment rate among full-time postsecondary students had fallen by 3.3 percentage points between the fall 2008 (September to December) and winter 2009 (January to April) terms, overall there have been gains in each of the following terms, particularly during winter 2010.
The average employment hours of postsecondary students with jobs increased steadily until the late 1990s and have since hovered around 16 hours per week (Chart C and Table 7). Although average hours have increased, 9 in 10 students still work part time during the school year. The trend and business cycle fluctuation in student work hours have been similar for both sexes, however, men have consistently worked on average 1.5 to 2.5 more hours per week than women.
The average time spent at a job has trended downward since the recent economic downturn, and increased marginally in the fall of 2009 before dropping further in the winter of 2010. The average work hours for all students with jobs for the winter 2010 term was 15.6, the lowest it has been for about a decade (Chart D).
With average weekly employment hours dropping slightly, but not significantly, over the recent recession and hourly wages increasing from $10.75 in 2007/2008 to $11.80 in 2009/2010, average weekly earnings approached $200 in 2009/2010 (Table 2). Assuming students keep their part-time jobs for the duration of the school year (from September to April or roughly 34 weeks), average income from earnings for 2009/2010 would have been about $6,300. Students who managed to keep or find a job during the economic downturn therefore held their ground in terms of earned income. However, the 2.5% increase in the unemployment rate suggests that, had the rate remained the same as before the downturn, an additional 30,000 students (2.5% of the 2009/2010 student population) would have been employed. Research has shown that declining student employment rates in 1982 and 1990 were followed by large increases in the number of Canada Student Loan Program clients (Usher and Dunn 2009).
The importance of student earnings in financing education was also evident in the 2002 Post-Secondary Education Participation Survey. It found that the median cost of the 2001/2002 school year for postsecondary students age 18 to 24 was $10,900, and for students with employment earnings, $3,000 were used from this source (Ouellette 2006).
Since employed male students worked about two extra hours per week, and earned more per hour than their female counterparts ($12.15 per hour in 2009/2010 versus $11.55), their weekly and school-year earnings were higher. Estimated school-year earnings were approximately $6,900 for men and $6,000 for women.
Compared with students age 15 to 19, those age 20 to 24 were more likely to work while going to school, work longer hours and have higher wages. The potential school-year earnings by age group range widely from approximately $5,000 for younger students to over $7,000 for older students. The financial consequences for unemployed older students are therefore much greater than those for younger students. Furthermore, older students are also less likely to depend on their parents for financial assistance.
What are the personal and job characteristics of students who work? Findings have already shown that older students and women are more likely to be employed during the school year. Immigrant students are much less likely to work while going to school (32%) compared with their Canadian-born counterparts (49%) (Table 3). Although the gender difference in the employment rate holds within the two groups, for example, immigrant women have a higher employment rate than immigrant men (35% versus 29%), both rates are still less than that of Canadian-born female (53%) and male students (43%). Going to school in a large urban centre, which offers more job opportunities, also increases the chances of being employed (47%) compared to students living in smaller centres (39%). Living at home does not appear to increase student employment rates. 'Living at home' refers to students who spend at least 30 days of the year living with at least one parent, therefore students who live in a school residence and return home for the summer fall into this category.1 Although the proportion of students living at home varies considerably by age, with 85% of those age 15 to 19 doing so, compared with 61% of 20- to 24-year-olds, there is no significant difference in the employment rate by age and place of residence (Chart E). Finally, a higher proportion of college students (49%) than university students (43%) have a job while attending school.
There was less than a two-hour variation in the average weekly hours worked among all student characteristics considered. Although immigrant men had the lowest employment rate, those with a job had the highest average work week—17.3 hours. In terms of longer hours, less than one in five employed students (18%) worked more than 20 hours per week. Working at least 20 hours per week has been shown to be an important threshold, with some studies indicating that long hours can interfere with postsecondary performance and student retention.
Finally, provincial employment rates and average hours worked are consistent with historical trends (Usalcas and Bowlby 2006). During the 2009/2010 school year, both Manitoba and Quebec had school-year employment rates above 50% and New Brunswick (27%) and Newfoundland and Labrador (34%) had the lowest average rates (Chart F). Average weekly hours ranged from a high of 17.3 in Saskatchewan to a low of 15.2 in Quebec.
Of the 542,000 postsecondary students who were employed during the 2009/2010 school year, almost all (96%) had a job in the service sector, compared with 78% of the total non-postsecondary-student employed population (Table 4). Retail trade, in particular, accounted for over one-third of all student employment: 32% for male students and 38% for female students (data not shown). Food and beverage (e.g., grocery stores) and clothing stores account for one-half of the retail trade jobs. The remaining retail employment includes such categories as general merchandise stores, health and personal care stores (e.g., pharmacies and drug stores) and sporting goods, hobby, book and music stores. Retail employment is conducive for students since it often offers part-time hours, evening or weekend shifts, and minimal required experience. From September 2009 to April 2010 there were 2.0 million jobs in retail overall. With some 200,000 students working in this field, their employment represents 10% of all jobs in the retail trade industry.
Restaurants and other eateries also offer many student job opportunities, with 18% working in this industry, compared to 5% of other workers. Students also had a higher-than-average representation in the education services and arts, entertainment and recreation industries, where many work as research assistants and instructors in recreation and sport, respectively.
Although most students have consistently worked during the summer months, employment patterns during the school year have changed substantially. Since the late 1990s, almost one in two full-time postsecondary students have been employed during the academic school year, up from one in four in the late 1970s. At the same time, hours at work rose and then levelled off, averaging around 16 per week over the past decade.
In the 2009/2010 school year, not only were there proportionally more women age 15 to 24 attending postsecondary school than men (56% versus 44%), but they were also more likely to be employed (50% versus 40%). However, on average, employed male students worked longer weekly hours than their female counterparts—16.7 compared with 15.3. Older students and Canadian-born students were also significantly more likely to work while attending school. Almost all employed students worked in the service sector (96%), with 36% in the retail trade and 18% in food services.
Students have not been immune to the recent economic downturn as they experienced a drop in their employment rate and average hours worked. The full-time postsecondary student employment rate fell by over 3 percentage points between the fall 2008 term and the winter 2009 term. Although the rate increased to 46.5% during the winter 2010 term, the rate is still lower than the fall 2007 term rate of 47.9%.
Many students rely on employment earnings to help fund their education (Ouellette 2006). The estimated school-year earnings of those with a job were about $6,000 before and during the economic downturn (2007/2008 to 2009/2010). Even though students with a job managed to hold their ground in terms of earnings, there were an estimated 30,000 fewer students with jobs over the period.
The summer of 2009 was the worst labour market for postsecondary students age 20 to 24 since the recession years of 1982 and 1993. Between the summers of 2008 and 2009, the employment rate dropped from 70.3% to 63.0%, the unemployment rate increased from 9.0% to 13.6%, and the percentage with a full-time job dropped from 60.7% to 56.6%. It is particularly difficult for students to be jobless during the summer due to the potential earnings loss. Students who were employed during the summer of 2009 earned $6,700 on average.
The recent declines in the school-year and summer student employment rates due to the economic downturn, and subsequent increase in the unemployment rate, suggests more students would have been working at a paid job if they could have found one. However, most college and university programs last for several years, and with signs that student employment is starting to recover, students wanting work may soon have a better chance of being employed again.
Many students start to think about where to apply for a summer job well before the second term of school is finished. The four months are a narrow but good opportunity for many to gain useful work experience, and, more importantly, to earn money to put towards their continuing education. Competition can be stiff as tens of thousands of students descend on the job market all at the same time.
Beginning in 1997, the federal government created the Youth Employment Strategy (YES) to help youth find employment and gain workplace experience. One part of YES includes the Summer Work Experience program, which is aimed specifically at secondary and postsecondary students returning to full-time studies in the fall. The program offers wage subsidies to employers to encourage student hiring and support the operation of summer employment offices (see HRSDC 2010 for more information).
The LFS tracks summer employment trends of students by asking all respondents age 15 to 24 two additional student-related questions during all interviews that take place between May and August (see Data source and definitions). The first question asks whether the respondent had been a full-time student in March of that year, and if "yes," whether he or she expects to return to school full time in the fall. The data in this section refer to all those who responded positively to both questions. Furthermore, since the type of school in March is unknown (high school or postsecondary) the sample is limited to those age 20 to 24—ensuring that the majority of respondents are college or university students (the target population of this study).
While the employment rate during the school year has increased steadily over the past several decades for all age groups, the summer employment rate for full-time postsecondary students age 20 to 24 has consistently averaged around 70% (Chart G). Similar to the overall employment rate, the employment rate for students during the summer moves in tandem with the increases and decreases of the business cycle. The decline between the summers of 2008 and 2009, down from 70% to 63%, was the second largest year-to-year drop since 1981 and 1982, when it fell from 72% to 62%.
As seen earlier, students age 20 to 24 who worked during the school year earned, on average, roughly $7,000 in 2009/2010. Hourly earnings are roughly the same during both the school year and the summer, but the proportion working full time more than quadruples (up from 12% during the 2009/2010 school year to 57% during the summer of 20092). Therefore, due to increased weekly hours, the same cohort earned roughly the same amount ($6,700) during the summer of 2009 (Table 5). Although summer earnings do not cover the total expenses of another year of schooling, they can help offset some of the costs. The savings rate is also probably quite high for the students who return home for the summer, avoiding the cost of room and board.
Despite the drop in average weekly hours between the summers of 2008 and 2009 (from 30.0 to 28.8), total summer earnings were similar in both years because of the slight increase in hourly wages (from $12.40 to $12.85). Although those with a job fared about the same in both years, it is important to keep in mind that there were roughly 40,000 fewer students employed during the summer of 2009.
The summer employment rate for students fell between 2008 and 2009 in most provinces, but in both years the Atlantic provinces had higher-than-average levels (except for Newfoundland and Labrador), as did Saskatchewan and Manitoba. Employed students in these provinces had higher-than-average weekly hours as well, and with the western provinces boasting the highest hourly earnings, students in Alberta and Saskatchewan were able to earn roughly $9,000 in the summer of 2009.
Note: While this article was in production, the final 2010 data for summer student employment (May through August) were released. Key findings show the employment and unemployment rates for postsecondary students age 20 to 24 to be 66.4% and 8.3%, respectively. Average weekly hours worked were 27.7 and average hourly earnings were $12.80. Finally, the full-time employment rate for students during the summer of 2010 was 51.8%.
The Labour Force Survey (LFS) is a monthly household survey that collects information on labour market activity from all persons 15 years and over. Respondents are also asked whether they are currently attending school, whether it is on a part-time or full-time basis, and which type of school they attend. In order to examine the employment behaviour of students during the academic year, eight months of data from September through April are used.
The LFS adds special student-related questions during the summer months (May through August) in order to identify youth who were full-time students in March of the current year and who plan to return to school full time in the fall. These questions are only asked of respondents age 15 to 24 and the type of school is not collected. Since this study focuses on postsecondary students, information on summer employment trends includes only those age 20 to 24.
The target population includes all individuals age 15 to 24 who reported attending community college, CEGEP, or university during the school year (September through April).
Students living at home include all those currently at home as well as those who are away at school temporarily. Students are coded as living in the household if they spend at least 30 days of the year at home. Students who do not return home for at least 30 days are included in the dwelling they occupy during the survey reference week and are labelled living away from home.
Information on earnings is collected from all employees for their main job and refers to pay before taxes and other deductions, and includes tips. Almost all employed students work at a paid job (98% in 2009/2010).
Average usual hours worked refers to the normal hours an employee spends at his or her job per week and does not include any overtime. However, prior to 1997, employees were to include overtime hours in their estimates if they were typical to their schedules.
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Katherine Marshall is with the Labour Statistics Division. She can be reached at 613-951-6890 or email@example.com.