Wednesday 23 January 2019

Going on to higher education pays off in the end

There's no doubt that staying on can be a costly business for many, but taking the right course is always worth it

Stock image
Stock image

John Walshe

Going to college is an expensive business, even if you are on a higher education grant. At a time of virtual full employment some will be wondering if it's necessary to get a further qualification after the Leaving Certificate. But all the evidence shows that it is worthwhile in terms of better health and wealth for most students.

International research confirms that those with higher levels of education live longer, enjoy improved health, earn more and are less likely to be unemployed than those with lower levels of education. They also tend to be happier.

The main evidence is available from the Paris-based think-tank, the Organisation for Economic Co-operation and Development (OECD). Some of what has been established internationally has also been confirmed in studies in Ireland with researchers finding a strong association between educational attainment and:

  • Life expectancy
  • Family stability and children's well-being
  • Higher propensity to volunteer
  • Trust in others and to believe one has a say in government.

The education attainment of people in Ireland has improved dramatically over the past half century since the introduction of free second-level education in 1967. Those now aged 60 to 64 were the first generation to benefit from this policy which transformed the lives of those in subsequent generations.

The results are clear from the 2016 Census. Those in the 35-39 age group are 2.4 times more likely to have a third level qualification than those in the 65-69 age group.

In Ireland a third level education is consistently associated with an employment rate at least 10 percentage points higher than for those who completed secondary education only. This is a large employment advantage compared to the rest of the EU.

A recent survey from the Higher Education Authority confirms that most graduates who enter the labour market are doing well. Job placement is back to the pre-recession days.

The unemployment rate last year for honours/bachelor degree holders was 3pc, compared to 9pc for those with an upper-secondary education and 13pc for those with a lower qualification.

Research shows that an Irish male graduate earns on average €330,000 more over their lifetime than a male who leaves the education system with the Leaving Cert or equivalent. In fact, the personal financial benefits of a degree to an Irish male are among the highest in the world, the figures suggest.

For a female graduate the earnings "premium" from having a degree is lower at around €250,000. The notion of equal pay for equal work is still not embedded in all employment sectors.

During the recession, the earnings advantage of a degree dropped a little for both genders but even then a degree was still well worth striving for and gave graduates an advantage over those who left the education system with lower qualification levels.

Both females and males also benefit in terms of mental health. Self-reported depression decreases with higher levels of education and when adults are employed rather than jobless or inactive. One in five male drop-outs from Irish schools and one in four female drop-outs report having suffered from depression while the corresponding figure for graduates is around one in 10.

It's not just the graduates who benefit. So too do governments as third level graduates pay higher income taxes and social contributions and require fewer social transfers such as the dole. "This is the case in Luxembourg, Ireland and Portugal - countries with very large net financial and public returns," says a recent report from the OECD.

Of course, not everybody with a third level qualification is guaranteed to waltz into a well paid job. Some graduates, especially those with arts degrees, can begin work on very low pay levels. Last year 15pc of arts and humanities graduates started off earning less than €13,000 a year. However, experience and further specialised training usually adds to their earning power.

The OECD's Education at a Glance report confirms that early school-leavers in Ireland are being increasingly penalised in the labour market for dropping out of education too soon. Seven years ago 68pc of 25-34 year olds who left school early were in jobs but that has since plummeted to 44pc.

This doesn't mean, of course, that every early school-leaver fares badly in the jobs' stakes. We all know individuals who dropped out and who are now doing very well for themselves. But the OECD notes that only about five pc of early leavers are in the highest earning category in Ireland, a finding which is in line with figures from other countries.

If all the research at home and abroad tells us anything it's that staying at the books pays off in the long run.

Sunday Independent

Editor's Choice

Also in Irish News