Rising tuition costs are eroding income gains for Canadian graduates, especially in engineering and architecture
According to data from Statistics Canada, university graduates in Canada continue to earn high incomes, but the return on investing in post-secondary education has diminished in recent years as tuition growth has outpaced graduate income increases.
While higher education still leads to better financial outcomes, with university degree holders earning significantly more than those with lower educational attainment, fields like engineering, architecture, and related sciences have experienced a sharp decrease in the return on investment.
Between 2012 and 2017, tuition for undergraduate degrees rose by 12 percent after adjusting for inflation. However, from 2017 to 2022, median incomes for graduates only increased by 4 percent.
This gap is most pronounced in engineering and architecture, where income multiples over tuition have dropped significantly. For instance, architecture graduates in 2022 earned 8.6 times their final-year tuition, down from 10.6 times in 2017.
Engineering graduates saw their income multiple fall from 12.3 times (for 2012 graduates earning in 2017) to 10.2 times (for 2017 graduates earning in 2022).
Despite this decline, engineering graduates still earn among the highest incomes, offering a better return on tuition investment than most other programs.
On average, those holding a bachelor's degree earned a median income of $61,600 in 2021, which was 44 percent higher than the overall sample median.
This income is considerably higher compared to the $30,200 earned by high school diploma holders or the $45,600 earned by those with university certificates or diplomas.
In addition, apprenticeship and trade certificate holders earned $45,200, marginally higher than the $44,800 for those with a college diploma or CEGEP certificate, highlighting the competitive earning potential of skilled trades.
While educational attainment plays a key role in income levels, factors like labour market conditions, macroeconomic policies, and job experiences also influence financial outcomes.
Provincial measures, such as Ontario’s 10 percent tuition reduction in 2019 and British Columbia’s 2 percent cap on tuition increases, could help curb tuition costs, potentially improving the income multiple for future graduates.
However, international students face continued tuition hikes, with their post-graduation income growth falling short of the rising tuition fees.
