Participants in labour markets can handle matters all on their own own
If the Liberal platform is a guide – and we’re a democracy so it ought to be – next week’s budget contains $775 million of recent money for a number of “labour market development” initiatives. Though any support for markets among left-of-centre parties is to be encouraged, the thing about markets is that they don’t actually need plenty of support. They are places, by definition, where individuals come together to trade. In labour markets, particularly, suppliers need work while demanders need workers. Governments might have to enforce legal contracts between workers and employers, but beyond that, governments might not be required. Participants in labour markets have compelling economic good reasons to handle matters all on their own.
Yes, yes, we know: Markets can fail in myriad ways in which economists have spent the last half-century elaborating. However the fact that labour markets can evolve in mysterious ways, with demand and supply taking completely unexpected turns, doesn’t give government any special insight into their future evolution.
One thing governments can do, however, is provide information about labour markets. A good example is a new Statistics Canada study what university graduates from different fields of study earn. The data are from the 2011 National Household Survey, which replaced the compulsory Long Form Census. They show what male, female, college, bachelor’s and master’s graduates with degrees in detailed areas of study earned on average this year. The table attached to this article provides only a taster from what’s way too rich a buffet of information to reproduce in its entirety. Should you or a friend are trying to decide things to focus on, the study will a minimum of let you know what graduates from different disciplines were earning in 2010 who have been working full-year and full-time and were between 25 and 54 years of age. (The research calculates these averages only when 200 people or more people were working in any gender/discipline/degree category, so some of the entries for women are blank).
Money isn’t everything, but when you need to do want to maximize your wages, studying money seems to be the very best job for making it. Bachelor’s graduates in management science and quantitative methods made $130,000 on average when they were male, $95,000 if female. But then, in 2010 Michael Lewis’s The large Short also demonstrated the unhelpful role “quants” took part in creating the financial market disturbances of 2008 and beyond, so perhaps the marketplace continues to be shorting these incomes since these data were collected.
Finance, accounting and general business/commerce graduates also did well, with males averaging over $100,000 and females one-fifth to one-quarter under that.
At the bottom end of the distribution are theologians, social workers and philosophers. Maybe society should value the work they do more, but it apparently doesn’t. Still, their labour presumably brings its own (untaxable!) satisfactions.
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As an economist, I’m pleased to see that econ grads do thousands of dollars annually much better than the average university graduate. As someone who writes for newspapers Remorseful to see that my male journalist colleagues do $14,000 worse compared to average for those fields. On the other hand, female journalists do $3,000 better than female grads in general.
Data by what was happening in 2010 obviously won’t let you know what supply and demand is going to be doing in 2020, 2030 or 2040. And money isn’t and should not be everything in choosing one’s university studies. But information such as this study provides can’t hurt and probably can help as people arrived at make their post-high-school decisions by what to review. In fact, for informed decision-making it would be helpful to have much more detail: how much variation round the average can there be in every discipline? What’s the typical age-earnings profile? How many employed graduates of each discipline are there and just how quickly has employment been growing (or declining)?
Private businesses could produce comprehensive data of the sort. But when they’d gone to the considerable expense of doing this, how could they create sure only those customers prepared to pay it off could be privy to it? Providing detailed information about what’s happening in the labour market may therefore be something government must do to help the labour market. Despite whatever you decide and read in next week’s budget, which may be all it must do.
