Full-time enrolments in universities and colleges across the country are on the rise and Canada now has the highest level of educational attainment in the adult population of any other country. As such, it only makes sense to wonder if this growth in supply of high-level skills compares to the growth in demand, says Dr. Torben Drewes, Economics professor at Trent University.

“With full-time enrolments in Canadian universities approaching 900,000 and in college nearing 500,000 we have considerable resources tied up in producing this human capital, both in expenditures on bricks, mortar and labour and in labour tied up in the classroom. It is legitimate to ask whether we are getting a decent rate of return on this social investment,” Dr. Drewes says.

To address this question, Dr. Drewes conducted a study with colleague Dr. Dan Boothby, an update of which was recently published by the C.D. Howe Institute, to analyze the average earnings for those with a university degree, college diploma, and a trade certificate, compared against those with only high school. They concluded that the earnings premium, between 1980 and 2005 has continued to rise.

“To the extent that higher earnings reflect higher productivity, the private rates of return to education are an important part of the social rate of return. And with real rates of return on investments in higher education in the range from 11 per cent for college graduates to 17 per cent for female university graduates, those investments are extremely well rewarded,” said Dr. Drewes, adding “Our social investment in post-secondary education is a good one. So is the private investment for the average student.”

Dr. Drewes has been teaching in the Department of Economics at Trent since 1980, during which time he has assumed a number of roles, including department chair, chair of the Senate Budget Committee, and institutional analyst. For the last decade, his research has focused on the economics of higher education.

Posted on Thursday, September 9, 2010.