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In the tough job market, the highly educated feel the squeeze

The job market has become tougher for people with graduate degrees, such as Carissa Wong, a new lawyer with a master's from Duke University and a bachelor's from the University of Toronto.

After Ms. Wong completed her master's in environmental management, she worked on freshwater issues for the World Wildlife Fund in Washington, D.C., for five years.

She wanted to have a more direct impact on people's lives and decided to pursue a law degree. She graduated from University of Ottawa's law school in 2012 and then spent the year articling for free at Ecojustice, a national environmental law group.

But after being called to the bar in 2015, she found it difficult to find a job that used her education and experience.

"There's a lot of competition to do public interest environmental work," said Ms. Wong. "Canada has a small market for highly educated people."

Ms. Wong is part of a growing number of Canadians who have found that their degrees are not opening the same kind of doors they used to a generation ago.

The Canadian labour market has not kept pace with the flood of people with master's, PhDs and other professional degrees. Meanwhile, those with postsecondary certificates such as college diplomas, apprenticeships or trades certificates, have been making gains.

"Those with less than a BA are gaining some ground. You take somebody working in manufacturing or construction, they are making more than those who would like to do something in their field," said Benjamin Tal, deputy chief economist with Canadian Imperial Bank of Commerce. "In the past, just having a university degree will be great. That is not the case any more."

The number of workers with a master's or PhD has doubled to 1.23-million employees over nearly two decades, according to data from the Centre for the Study of Living Standards (CSLS), an economics research group. The data was compiled on employees between the age of 20 and 64 and used 2014's federal income tax brackets.

The data revealed some signs of distress among the country's most educated. The ranks of low-income earners with a master's degree or PhD is rising. Also, the proportion of workers with graduate degrees who earned between zero and $46,000 (the lowest income-tax bracket) expanded to a third last year from a quarter in 1997, according to the data. The income tax groups were inflation-adjusted to 2014 dollars.

Ben Darrah, a teacher with a bachelor of education and a master's in fine arts, has felt the stress of underemployment for years. After completing his master's, Mr. Darrah bounced from job to job, teaching classes at Queen's University, St. Lawrence College and other institutions, but never making enough to make ends meet. He enrolled in teachers' college in 2007 to improve his job prospects. But when he graduated in 2008, it was the beginning of the Great Recession and the demand for teachers was waning.

Mr. Darrah started off as a supply teacher, then got a contract to teach four hours a week. He supplemented his income with supply work wherever he could find it. During the summers, he did any job he could get. "It was very frustrating," said Mr. Darrah. "What is funny is that they are the same jobs I was doing in high school for about the same pay."

In September, Mr. Darrah will be working full-time as an elementary-school teacher in the Kingston area. "I feel finally that [for] the first time I am going to be having a living wage. I will be able to focus on just one thing and not have to scramble," he said.

Workers with university degrees still dominate higher-paid jobs. They have lower unemployment rates and more opportunities. But data suggests that the demand for highly educated workers is not growing as fast as it once did.

Canadians without university degrees have climbed the income ranks faster than those with higher levels of education.

The decade-long bull market in commodities and oil helped people without university degrees thrive. In Alberta, wages soared as the energy industry sought to attract workers to operate and service oil production. A worker with a high-school diploma or a trades certificate could earn upward of $100,000 a year, higher than the national average. Now, with the oil industry restructuring amid low crude prices, thousands of lucrative labourer positions have disappeared.

Last year, 7.5 per cent of the employees with a postsecondary non-university diploma earned between $88,000 and $136,000, compared with 3 per cent in 1997, according to CSLS data.

That is a small percentage of the total work force, especially compared to the cohort of workers with graduate degrees.

Of the workers with a master's degree or PhD, 23 per cent earned upper-middle-income wages last year compared with 20.6 per cent in 1997. But the growth rate was incremental compared to their lower-educated peers.

"Getting an education looks a little bit less attractive than it looked 50 years ago. Still, I don't want to send the wrong message. It's not that they are not attractive. They are less attractive than they used to be," said Paul Beaudry, a professor with the University of British Columbia's Vancouver School of Economics.

Mr. Beaudry and his colleagues analyzed trends in the U.S. labour market and discovered that around the year 2000, the demand for skills associated with high levels of education started to decline "even as the supply of high-education workers continues to grow." Their study found that high-skilled workers were starting to do jobs that lower-skilled workers used to do.

"There was a period that that demand was ever increasing for the top educated people. There was a feeling that it was going to go on forever," said David Green, one of the co-authors of the study and a professor at UBC's Vancouver School of Economics. "But it reversed itself after 2000. In Ontario, you get something of that. In other parts of the country, it is not as clear."

Ms. Wong is starting her own environmental-law firm because she does not "see a lot of opportunities in Canada to do really meaningful environmental work." She wants to help people with environmental problems and establish a business that supports young lawyers.

"I'm not expecting to make a lot of money, but enough to cover my expenses," said Ms. Wong, who is working pro bono for a few clients.

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