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The Walrus o c t o b e r 2 0 1 2


The Uses and Abuses of

Canadas post-secondary education system is
failing our students, and our economy
by Ken Coates and Bill Morrison
Illustrations by Graham Roumieu

n 2006, Philip Isard was an accomplished undergraduate, with solid A

grades from the University of Waterloo in Ontario and glowing letters of
recommendation for graduate school.
Earnest, hard working, i ntensely
curious, and personable, he epitomized the talent and energy of a top
Canadian university student. He went
on to complete a masters in history,
picking up what he thought would be
valuable research experience along the way. After finishing two
degrees, he had exhausted his savings, and his student loans
were piling up. Unsure whether a multi-year struggle to earn
a Ph.D. would land him a job, he opted for the world of work.
He hoped to find a stable career in the public service, with an
NGO, or in the private sector. His career and financial aspirations were modest and, he thought, attainable.
He applied for numerous jobs in and outside his fields of interest, dozens per month. With every rejection, he adjusted his
expectations and widened his search, bolstering his resum
with volunteer work, short-term research contracts, and unpaid
internships. Finally, about a year and a half after graduation,
he landed a promising position with a newly established NGO
in Toronto. After five months, though, his job was reduced to
an unpaid volunteer position when the organizations funding
dried up.
For the next month, he travelled back and forth between
Vancouver and Toronto, searching for entry-level jobs and tapping into a wide network of peers, colleagues, teachers, and
friends. Equipped with a cellphone and a laptop, he arranged
information interviews with businesses and non-profits across
Canada. After weeks of travel, with an empty bank account and
no real prospects, he returned to Toronto.
Isard is among the more than 254,000 graduates produced by
Canadian universities each year, and a member of a new class

whose education is poorly matched with the national economy. Undergraduates face various options. Thousands continue their studies at the graduate level, hoping the additional
credential will generate better opportunities. Others exchange
their mortarboards for admission to a trade- or career-oriented
program; in 2005, about 13percent of university graduates continued their studies at a college, while the rest headed into the
workforce. But those who choose the latter route can encounter surprising difficulties, struggling as Isard did to find paid
employment or, increasingly, accepting unskilled, low-paying
jobs to stay afloat.
The majority of Canadians believe in the value of a university educationif not to strengthen the economy, then simply
for personal gain. Surveys show that most Canadian students
and their parents believe that high school graduates should go
on to post-secondary education. A 2010 study, Youth Decision
Survey Report, by the Nova Scotia Department of Labour and
Advanced Education, showed that 60percent of high school
students believed their parents wanted them to go to university.
According to Statistics Canada, 67percent of parents wanted
their children to go to university, compared with the 15percent
who hoped for a college or CGEP diploma. A mere 2percent
wished for their kids to get a trade certificate.
According to a 2001 Conference Board of Canada report,
a shortage of a million workers is expected in this country by
2020. Even now, thousands of skilled trades and specialized
technical jobs go unfilled: the Merit Contractors Associations
Saskatchewan branch reported in June 2012 that 74percent of
its members had trouble hiring tradespeople when they needed
them, and 42percent couldnt find them at all. Firms have begun
recruiting in other countries, as far away as Romania and the
Philippines, and classified ads across the country advertise jobs
in advanced manufacturing, IT, skilled construction work, and
health care. But for those with a basic bachelors degree in English, chemistry, outdoor recreation, or psychology, jobs that fit
their qualifications seem impossible to find.

The Walrus o c t o b e r 2 0 1 2

Watching the emerging employment crisis is like following

a first-year economics lecture on supply and demand. University degrees originally derived their value from two elements:
specialized expertise (medicine, engineering, law), and scarcity. When only 5 to 10percent of high school graduates went
on to university, a bachelors degree promised good value
and job prospects. In effect, the graduates of the 1960s represented the workforce elite: highly employable, with great
career potential. They did well economically in the following
decades, giving rise to the often repeated but seldom examined statistic that, on average, university graduates would
earn $1million more over their careers than those with only a
high school diploma.
If a degree carries such high returns, then more graduates, it
would seem, must be better. Governments urged greater numbers of young people to continue their studies, believing (with
more faith than evidence) that a tsunami of post-secondary
graduates would produce a generation of high-income-earning
and wealth-generating Canadians. We now have one of the
worlds highest rates of residents with post-secondary degrees
and diplomas, second only to South Koreas. But not all degrees
are valued equally in the job market, and as additional students
graduate each year the university degrees earning potential has,
in some fields, fallen significantly.
apid growth in university enrolment helped
to define Canada after World War II. In 1930,
Canada had 33,000 graduate and undergraduate
students. By 1950, fuelled by a federal commitment to reintegrate returned servicemen through
university education, the nations student population jumped to nearly 69,000. Ten years later, it had reached
114,000. At the University of British Columbia, postwar demand
for campus facilities was so great that abandoned army and air

force camps were dismantled, relocated, and pressed into service

as offices, labs, classrooms, and residences.
As late as 1960, universities remained the domain of white
men; only one-third of full-time undergrads were female. Between
1965 and 1975, total enrolment leaped forward again, from
200,000 to 370,000. Almost every corner of the country shared
in the post-secondary education boom. New campuses opened
in places as diverse as Sydney, Nova Scotia; Prince George, BC;
and Thompson, Manitoba. The countrys participation rate (the
percentage of the population between the ages of twenty and
twenty-four), which had been 2.8percent in 1930, multiplied
nearly nine times; by 2009, it had reached 25percent.
There are now 1.1 million students on campus, nearly 60percent
of them women, and the expansion is self-replicating. University graduates are far more likely than other parents to send their
children to university. Among young adults aged twenty-five
to thirty-nine, 56percent of those who have one parent with
a degree also graduated; of those whose parents did not, only
23percent completed their studies (although the latter number
is growing quickly).
On the positive side, people who had once been excluded from
university by gender bias (women), racism (people of colour and
First Nations), or income (immigrants, the working class) are
more likely to obtain a degree. On the negative side, this means
that in the three generations since World War II, Canadian universities have shifted from being preserves of the rich, the gifted, and the intensely ambitious into the academic equivalent of
intramural sports, where the premium rests on mass participation rather than on high achievement.
In the 60s and 70s, university expansion worked in concert with the needs of our labour force, as the Canadian economy began to shift its emphasis from the basic manufacturing,
construction, and resource sectors toward more government
employment, finance, middle management, and service. Today

Ken Coates and Bill Morrison T h e U s e s a n d A b u s e s o f U n i v e r s i t y

Most university graduates

get jobs, but more than a third
accept positions that do
not require post-secondary
qualifications, such as barista

or car rental agent. Thus,

universities can and do claim
that their graduates find jobs,
even while graduates
complain that their career
hopes have been dashed.

fewer than 2percent of Canadians work in the agriculture sector,

down from 40percent in 1900. Between 2000 and 2010, manufacturing declined by more than 28percent, or 571,550 jobs. The
shortfall was made up in large part by a shift to service-based
employment, by 2011 fully 78percent of the jobs, and the market seemed primed for the surge in university graduates.
In his provocative 1995 book, The End of Work, Jeremy Rifkin
outlined the mechanization that has displaced many industrial
and white-collar workers while improving their employers productivity, profitability, and competitiveness. Those jobs may
never come back, and the associated decline of trade unions
has eroded the wages, benefits, and working conditions of the
manufacturing jobs that remain. The solution, argued proponents around the globe, lay in building a knowledge economy
and a science- and technology-based society that would favour
brains over brawn.
In response, both Prime Minister Jean Chrtien and President
Bill Clinton made university attendance and advanced education cornerstones of their national innovation strategies, and
Canada placed universities at the centre of its economic planning in the late 1990s. Expanding post-secondary education and
research, so the thinking went, would bring widespread prosperity. The federal government poured billions of dollars into
the Canada Foundation for Innovation, the Canada Research
Chairs program, academic funding councils, and other support
for research and higher education. John Manley, a former Liberal deputy prime minister, remains a key advocate for such
strategies. Innovate or perish, he was quoted as saying in a
2009 Macleans article. The world is changing so quickly that
the inability to find ways to adapt to the changing environment
is detrimental, not only to the business sector, but to the countrys prosperity as a whole.
The greatest fans of these expansion plans were the countrys
universities; no one believed more strongly in the potential of

the knowledge economy. They would have preferred cash grants,

unconnected to enrolment (provincial funding is typically linked)
and sufficient to match the escalating costs of running researchintensive institutions, but they quickly came to terms with the
core message of twenty-first-century education policy: if you
want more money, take in more students. So they did.
Changes to the world of employment, however, did not always
align with these policies. Manufacturing and industrial jobs were
indeed disappearing, but the technology booms white-collar
jobs turned out to be far fewer and more specialized than originally predicted. White-collar employment has also been threatened, both by high-profile outsourcing activitiesthe transfer
of call centres, accounting, and medical jobs such as reading
X-raysto south and Southeast Asia; and widespread technological developments such as online banking, Asian animation
institutes, computer-assisted design and programming, and
automated financial systems. Tech-based innovation is affecting other professional categories, too; for example, lawyers are
just starting to feel the effects as companies adopt more streamlined electronic services.
Students who complete degrees in applied and specialized disciplines generally do fine; petroleum engineers are pulling in plenty
of job offers and high starting salaries, and accounting students
often have jobs lined up before they graduate. A strong market
exists for accountants, certain kinds of IT specialists, economists,
and environmental engineers, as well as nurses and other health
care professionals, all high-demand areas with typical starting
salaries of $45,000 to $60,000 a year. The same holds true for
those finishing medical school or elite law and MBA programs
(with post-MBA salaries ranging from $60,000 to $100,000), although there is currently a glut of aspiring lawyers. Doctors, especially, are often wooed with impressive start-up packages, which
often include salary guarantees, and such inducements as assistance paying off student loans. For those who choose welland

The Walrus o c t o b e r 2 0 1 2

circumstances can change in a flash if a sector of the economy

tanksuniversity offers an impressive return on investment and
attractive salary and career opportunities.
However, those with non-specialized degrees, bachelors in
the arts and sciences (Rifkin calls them garden-variety graduates), face prolonged underemployment. According to James
Ct, author of the 2007 journal article The Hidden Crisis in
the Canadian University System and co-author of Ivory Tower
Blues, the 1990s yielded some 1.2 million graduates, but only
600,000 new jobs that required undergraduate credentials. In
other words, the system produced many more bachelors degree
holders than the job market warranted. Since then, the number
of these graduates has steadily increased, butwracked by recession in Central Canada and the rapid growth of trades-based
employment in western Canadathe demand has not risen
along with universities output.
As Statistics Canada reported this past February, young Canadians bore the brunt of the continuing weak job market. The
number of employed fifteen- to twenty-four-year olds fell by
almost 27,000 in February, representing a total decline of close to
300,000 jobs since 2008. Although university graduates are less
likely to be unemployed than those with only a high school diploma, this is because they end up accepting jobs that require a lower level of education. They are, in effect, underemployed, trading
their degrees for the chance to compete for unskilled work.
Ct calls this the downward cascading effect of credential
overproduction. The current unemployment rate among undergraduates is just 5.2percent, though it is higher for recent graduates. As of June 2012, the unemployment rate for all Canadians
age fifteen to twenty-four was 14.8percent. More significant is the
estimated underemployment rate: over one-third, according to
the Organisation for Economic Co-operation and Development.
This makes us second only to Spain in underemployment among
OECD countries, as reported in a 2010 survey by The Economist.

That statistic is key. Most university graduates get jobs, but more
than a third accept positions that require no post-secondary qualifications, such as barista or car rental agent. Thus, universities
can and do claim that their graduates find jobs, even while graduates complain that their career hopes have been dashed.
Markets, to return to our first-year economics lecture, are selfcorrecting, and so it is with unhappy graduates. One of the most
common strategies for coping with the poor returns from a degree
is to go back to college for practical, career-oriented training.
Rick Miner wrote a startling 2010 report, People without Jobs,
Jobs without People, that highlighted the growing gap between
the skills of the Ontario workforce and the needs of employers.
There is a recent and interesting trend by which Ontario colleges are becoming finishing schools for four-year university
graduates, he observed. Students are increasingly completing
a degree and then enrolling in a one- or two-year postgraduate
certificate or diploma program in a college. [These decisions]
reflect a recognition by students that an academic education
is often not enough, that an employable skill is also required.
While the intellectual and even civic benefits of certification
creep may be considerable, so are the costs and the strains on
young adults and their families.
Other students cope with the underemployment problem
by heading for graduate or professional school. The lucky and
qualified find positions in medicine or other well-paying careers and do extremely well. Those who pursue a teaching certificate or a graduate degree in education are seeking a secure
job, but find themselves running against the receding tide of opportunities. Harsh as it is to reduce graduate school to a financial calculation, Statistics Canadas return on investment data
from 2001 shows that the monetary benefit of advanced studies ranges from negative (for humanities students in Quebec)
to marginal (for most social and basic sciences). Only the professional schools, particularly the top ones, show a solid return


Ken Coates and Bill Morrison T h e U s e s a n d A b u s e s o f U n i v e r s i t y

on time and money invested. In Quebec, the rate of return for

a bachelors in history was about 5percent, while it was more
than 20percent for medicine. One-fifth of bachelors degree
holders had a negative rate of return.
n canada, universities produce far too many
graduates in some areas and too few in others,
such as programs with a strong mathematical or
applied science base. In British Columbia this
year, roughly 25percent of grade twelve students
studied chemistry and 16percent physics. This
means the vast majority are not immediately eligible for the applied science and technology programs that are key to national
economic development.
Such statistics call into question Canadians belief that personal choice trumps all other considerations when students
apply to university. They are encouraged to study what they
want, rather than to focus on what the economy needs. This
means the shape and skill set of the countrys workforce is largely set by the decisions of tens of thousands of eighteen-year-old
first-year students. If they choose the humanities or basic science when the market needs engineers and nurses, the economy suffers, and so do they.
Many countries, including India and Estonia, deal with this
by directing students into fields with the greatest need. To use a
little-known example, the Estonian government subsidizes all of
the seats in high-demand areas; those wishing to study other areas
discover that only elite students receive full subsidies. Students
are not prevented from following their intellectual noses, but they
may end up doing so at their own expense. The Five Challenges of Estonian Education, a key strategic report for all levels
of education, stands in stark contrast to the Canadian approach,
downplaying student choice and emphasizing the nations economic, technological, and socio-cultural needs.
In April 2012, Jason Kenney, federal minister of citizenship,
immigration, and multiculturalism, introduced sweeping reforms
of immigration regulations after authorizing tens of thousands
of temporary worker permits while able-bodied, well-educated
Canadian graduates searched for employment. He also launched
a blunt attack on national assumptions about universities: Tens
of thousands of these Canadians go into universities every year,
taking courses that will leave them with loads of debt and no realistic prospects for a decent-paying job, he told the National Post.
One of the things that frustrates me is that it seems to me that
culturally perhaps in our education system we have devalued
basic work and trades.
Students and parents have responded to the situation by
demanding low tuition fees, particularly in Quebec, and more
access to universitytwo conditions that will produce even
more graduates and will further erode the quality and value of
undergraduate education. By fighting for those outcomes, they
are pushing on the wrong end of the rope. As many Quebec students will discover upon graduation, anger about a small increase in tuition will not solve their real problems, which rest
with their adaptability to the workforce.
Those who graduate from university have a lower unemployment rate than those who do not, but the continued growth in

The Buried Hatchet

by Jason Guriel
begins to biodegrade
andin the style
of drums of waste
in shallow if
not porous graves
poisons the soil
beside the river,
turning to bilge
all of the water
you thought was water
under the bridge.

the number of degree holders is causing problems. As Statistics

Canada reported in June 2012, highlighting overall employment
growth for those with degrees, This growth in employment...was
not strong enough to absorb the rapidly rising population who
have these credentials. Between 2008 and 2011, the population
with a bachelors degree or higher increased 10.7percent. As a
result, the employment rate for this group fell from 75.0percent
to 73.7percent.
As beneficiaries of the Canadian university system, as both
serial students and employees, we feel somewhat uncomfortable in challenging the status quo and calling attention to the
employment crisis facing graduates. For students who want to
learn, a degree is, entirely on its intellectual merits, a wonderful achievement and a lifelong benefit. But the vast majority
of students, and almost all of their parents, make it clear that
they value university not for self-improvement but to guarantee a good job.
Universities are uncomfortable with the reality that for most
students they are chiefly job training institutions. Until they
accept this fact, the disconnect between the academy and the
world of work will continue to grow, and so will public dissatisfaction. As Canada struggles to cope with a lost generation of
university graduates, all the while encouraging hundreds of
thousands more students to enrol, the misalignment of education and employment adds to the uncertainties of young Canadians struggling to find their way. u

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