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Some Canadian university graduates earn less than high-school dropouts in their first few years in the labour market, in part because the grads have spent more time studying and less time getting valuable experience, according to a Statistics Canada study.

A poll of Canadians aged 22 to 24, conducted in December, 2003, pinpointed the median earnings at $503 a week. The high end of the range was $729 while the low was $360.

Not surprisingly, people who had attained a college or university degree tended to earn more than the median, while those who dropped out of high school or had not completed a post-secondary program earned less.

However, the study found that some university grads – albeit a minority – were among those earning the least. Among the lowest-earning 22- to 24-year-olds, defined as those who brought home less than $360 a week, 12.8 per cent were high-school dropouts while 14.3 per cent were university grads.

“Although not the majority, we have in the population a significant proportion of people with low earnings who have a post-secondary degree,” said Patrice de Broucker, who co-authored the study with Darcy Hango.

Some university grads are earning less, in part, because they have spent less time in the labour market gaining work experience – and the accompanying higher wage premium. By the time they finish school, high school dropouts have been employed and working for a number of years, Mr. Hango and Mr. de Broucker said.

They calculated that 10 months of working experience brought an earnings premium of 4 per cent.

In addition, young Canadians with a post-secondary education might be in financial squeeze, the Statscan analysts said. “On the one hand, they may have increased debt associated with their postsecondary experience, while on the other hand, they may have increased opportunity costs associated with not being employed during the time when enrolled.”

Mr. de Broucker attributed the number of high-school dropouts earning high wages to a large number of lower-tier jobs, many of them in the resource sector. “We have an economy that is still partly based on natural resources and we have a fair number of jobs that may require physical strength rather than brainpower.”

Young adults with a postsecondary education were more represented among management and business-related jobs, as well as professional, scientific, education and government jobs, Statscan said. Young people with a high school diploma or less were more likely to work in the goods-producing and primary sectors of the economy.

Mr. Hango stressed that this study looks only at early-stage labour experience. “So we don't know what will happen to these people as they progress through their working career.”

Among regions, Alberta high schools are churning out high earners, with young people from that province earning “significantly more” a week than those who went to high school in the Atlantic provinces, Quebec, Manitoba, British Columbia, and Ontario. The study found that Saskatchewan was the only province comparable to Alberta.

The Statscan study found that young men were more likely to drop out of high school than young women, and more likely to delay the start of a post-secondary program. Young women were more likely to go on to some type of postsecondary program before getting into the labour force. Despite that, women still earn 28 per cent less than their male working counterparts.

One major factor driving the high-school dropout rate was grades.

“Marks matter,” the Statscan analysts said. “Youth with very low marks in high school were much more likely than those with average to high marks to drop out and not return. Very high marks predicted that the teen would go directly to a postsecondary program after high school rather than delaying.”

Among the other findings:

- Young people of Aboriginal descent were more likely than non-Aboriginal youth to leave the education system early.

- Not living in a two-parent family increased the risk of not finishing high school, as did having a greater number of siblings

- Young people with highly educated parents were more likely to get a postsecondary education

- Working some hours in high school can be beneficial, while working more than 20 hours a week can lead to a greater risk of dropping out of high school

- People who had a child or entered a conjugal union during their teenage years were more likely to drop out of high school

- Higher parental expectations regarding their child's education were linked to higher educational attainment

- Young people who moved provinces after high school saw higher earnings than those who did not.