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The Globe and Mail

The road to better pay: Is it college or university?

Sean Gallup/Sean Gallup/Getty Images

Who earns more, a chef with a college diploma or one with a university degree?

New research has shed light on the impact of higher education on wages in certain jobs. The study this week by the Martin Prosperity Institute and the Institute for Competitiveness and Prosperity looks at how returns to education, particularly among university and college grads, vary.

First, it finds the people with post-high school education almost always earn more than people with just high school. Health technicians, for example, earn 22 per cent more by finishing college than those who just have high school, and university grads earn 37 per cent more.

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In creative occupations, a university degree offers a higher return for education than a college degree, the paper says. In that class, university degrees tend to yield wages that are about 20 per cent higher while college diplomas tend to boost wages by 10 per cent. This is apparent for jobs in finance, professional health, management and administration.

"The size of that benefit varies from job to job, but as with creative occupations, the university degree is the route to higher wages," it says.

It's a mixed bag for service jobs, however -- paralegals and retail managers tend to fare best with university degrees. For the other half, a college-degree provides a greater return to average hourly wages than a university degree. That's because, in large part, they give people more specialized skills.

Childcare workers with a college degree, for example, earn on average 17 per cent more than those with just a high school diploma while childcare workers with a university degree only earn 9 per cent more.

To answer the original question -- chefs are better off going to college. They see a 22-per-cent increase in average wage from a college degree and only a 13-per-cent increase from a university degree.

"Education remains an important factor in determining annual income or hourly wage, but the detail offered by these insights shows some of the potentially complicating factors," the study says, adding that the results support the general expectation that more education and experience equals higher income.

The research comes after a Statistics Canada analysis this week showed the chances of being laid off in the last recession were relatively higher among young people aged 15 to 24 and those with no university degree.

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The workers most likely to have found a job in the short term in the recession had a university degree and more than five years of seniority -- suggesting education makes people more resilient in the labour force, even in downturns.

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