The Returns to Education, and the Increasing Age Gap between Younger and Older Workers
Statistics Canada Analytical Studies Working Paper No. 131
30 Pages Posted: 20 Jan 2000
Date Written: March 1999
Using a regression decomposition approach, we find that, during the 1980s, the growth in the relative educational attainment of older workers has contributed to about one-quarter of the increase in the age-wage gap of men and women. During the 1990s, the age-wage gap increased to a much lesser extent. Changing relative educational attainment accounted for a much greater proportion of the much smaller increase in the gap: almost one-half for males and over three-quarters for women. We also find that, during the 1980s, the expected weekly wages associated with all levels of education fell for younger workers, both for men and women (from 2% to 16%, depending upon education level). Older employees, on the other hand, experienced mixed results. Expected weekly wages rose for some older workers and fell for some others.
JEL Classification: J24
Suggested Citation: Suggested Citation