Ed­u­ca­tion may not re­duce in­equal­ity


oliti­cians, em­ploy­ers, teach­ers, econ­o­mists and bu­reau­crats all agree that ed­u­ca­tion is the key to lift­ing peo­ple up, im­prov­ing their fi­nan­cial prospects, nar­row­ing the gap be­tween rich and poor and boost­ing eco­nomic growth.

Re­gret­tably, this al­most uni­ver­sal con­sen­sus is at odds with the facts. Rather than be­ing the so­lu­tion to ris­ing in­equal­ity, ed­u­ca­tion may worsen the prob­lem, say two Cana­dian econ­o­mists in a sur­pris­ing study re­leased last week.

“Ed­u­ca­tion and train­ing pol­icy is no sil­ver bullet,” warn David Green of the Univer­sity of Bri­tish Columbia and Kelly Fo­ley of the Univer­sity of Saskatchewan.

Pour­ing bil­lions of dol­lars into univer­sity ed­u­ca­tion – as Ot­tawa and the prov­inces are do­ing – de­liv­ers the great­est ben­e­fit to mid­dle-and up­per­in­come stu­dents. In­vest­ing in ap­pren­tice­ship pro­grams and skills train­ing doesn’t level the play­ing field be­cause fe­male par­tic­i­pa­tion is low (9.7 per cent), the drop-out rate is high (43 per cent), and stu­dents from low-in­come fam­i­lies of­ten emerge with heavy debt loads.

The au­thors don’t ob­ject to all ed­u­ca­tion spend­ing. In­vest­ments in early learn­ing tar­geted at chil­dren from low-in­come house­holds make sense as an equal­izer, they ac­knowl­edge. So does in­creased in­come sup­port for par­ents of schoolaged young­sters.

But over­all, they cau­tion, “the forces that are driv­ing Cana­dian wages – like tech­no­log­i­cal change and the re­source boom – would not be off­set by sim­ply in­creas­ing the ed­u­ca­tion level of the work­force.”

The pair reached these sober­ing con­clu­sions af­ter an ex­haus­tive ex­am­i­na­tion of hir­ing trends, em­ploy­ment lev­els, earn­ings, and dif­fer­ences in pay lev­els for grad­u­ates from high school, col­lege and trade pro­grams, univer­sity and post-grad­u­ate cour­ses over the past 33 years.

What they found is that the re­turn on in­vest­ment in ed­u­ca­tion rose steadily un­til 2000, when oil prices be­gan to climb and com­puter skills be­came es­sen­tial in most work­places, then stalled. Rather than hir­ing univer­sity-ed­u­cated work­ers, em­ploy­ers could adopt new tech­nolo­gies. Rather than stay­ing in school, young men could get high­pay­ing jobs on Al­berta’s oil rigs.

“In­creased ed­u­ca­tional spend­ing, es­pe­cially at the univer­sity level, should not be counted on as a cen­tral pol­icy for re­duc­ing in­come in­equal­ity,” they cau­tion. Their anal­y­sis was pub­lished by the In­sti­tute for Re­search on Public Pol­icy.

Po­lit­i­cally, this ad­vice comes at an awk­ward time for all three party lead­ers. Stephen Harper touts ap­pren­tice­ship train­ing as a “key provider of the vi­tal skills and knowl­edge nec­es­sary to power and grow the Cana­dian econ­omy.” Justin Trudeau’s plan to bol­ster the mid­dle class is built on rais­ing the post-sec­ondary grad­u­a­tion rate to 70 per cent. Tom Mul­cair says univer­sity “is more im­por­tant than ever in this in­ter­con­nected world.”

The easy re­sponse would be to brush off the in­con­ve­nient re­port. The smart re­sponse would be to look at the ev­i­dence and ad­just poli­cies to fit the facts.


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