The wage advantage of pursuing studies has begun to decline in Quebec at the same time as the demand for labour has increased, particularly in less-skilled jobs. This sends a very bad signal, experts fear.
In 2017, workers aged 40 to 49 who had a university degree earned, on average, 81% more than those with a high school diploma or less, the Institut du Québec (IDQ) reported in a study released Thursday. While still present, this advantage had nevertheless eroded by 2023 to only 60%.
The gap has also narrowed between vocational and college graduates compared to workers with less education, with the former seeing their salary advantage fall from 26% to 19% during the same period.
This phenomenon is due to the fact that the wages and other wage benefits of the least educated have increased more during this period than those of other workers. The remuneration of people with a high school diploma or less has thus experienced real growth — that is, taking into account the effect of inflation — of 10% since 2017, compared to 4% for vocational or college graduates and a slight wage decline of 3% for university graduates.
The fault of shortage
This situation stems in particular from the efforts made by Quebec employers to attract and retain an increasingly scarce workforce, particularly for positions that did not require specific training, reports the IDQ. Generally speaking, the Quebec economy was already less productive than the rest of Canada and more “greedy” for low-skilled workers to ensure equivalent growth.
The decrease in the wage premium for education was particularly pronounced among men, from 81% in 2017 to 55% in 2023, between the most and least educated forty-somethings. This is due, among other things, to the strong demand for workers in certain sectors requiring little education but which are well paid, such as construction.
It is a question of balancing meeting urgent and pressing needs in the short term with not compromising longer-term prosperity and well-being.
Other factors also appear to have been involved, explain Anthony Migneault, an economist at the IDQ, and the president and CEO of the research organization, Emna Braham, co-authors of the study. The shortage of labour has, among other things, increased (from 28% to 33%) the proportion of workers who have a high school diploma or less, but who occupy a position usually assigned to someone more qualified.
In a rush to meet the urgent demand for workers in certain fields, particularly construction and health, the government has contributed to this phenomenon by offering “shortened training programs” and wage bonuses. Furthermore, more than half of workers paid the minimum wage have a high school diploma or less. However, this wage increased more, between 2017 and 2023, than all wages (+40% compared to +34%).
Attention, danger
We can obviously only be pleased with the improvement in the remuneration of less qualified workers, he said in an interview with Duty Emna Braham: The problem is that it can send the wrong message, that it wouldn’t be worth continuing your education even if you could. “It’s a question of balancing meeting urgent and pressing needs in the short term with not compromising longer-term prosperity and well-being.”
We must not forget, she says, that Quebec is still lagging behind in terms of graduation, compared to the Canadian average and that of some neighbouring American states, even among the youngest, and that the school dropout rate remains higher than elsewhere, especially among boys. However, in an economy condemned to improve its productivity to compensate for the shortage of labour and to make an energy transition forced by the fight against climate change, the need for qualified workers will not diminish.
In 2023, 36% of Quebecers aged 40 to 49 held a university degree, compared to 44% with a vocational or college diploma, 13% with a high school diploma, and 7% with no diploma. This age group is generally a good reference, our experts explain, because it allows us to compare individuals who have completed their studies and are at a comparable stage in their career.
The challenges of training and professional skills are not only important in the interests of the economy as a whole, continues Emna Braham. They are also important from the point of view of individuals.
While the wage advantage of pursuing an education has declined recently, it remains significant and grows as one advances in one’s career. From 25% when one is between 20 and 25 years old, the wage advantage enjoyed by university graduates over those with a high school diploma or less reaches 71% when one is between 45 and 49 years old.
Change of context
And then, research has shown that the more education a person has, the more likely they are to benefit from training throughout their career, helping them adapt to changes in the job market and be less vulnerable to economic upheavals.
Some less qualified workers must already be aware of this, as the strong demand for labour in recent years has given way, in recent months, to a more gloomy economic climate and increased competition for certain positions with the arrival of a greater number of temporary immigrants.
“The challenge is to ensure that workers and young people have the opportunity to reach their full potential,” summarizes Emna Braham. “And this is achieved in particular through education, whether vocational, technical or university.”