the briefing room

For many grade 12 students, spring is university application season. In Western Canada, youth living in families with an annual income over $100,000 are still more than twice as likely to attend university than youth with family income under $25,000.

This is hardly surprising, given average tuition fees run over $4,800 a year these days, but it’s fundamentally inequitable. It undermines social cohesion and there are real economic costs to all of us when we don’t fully utilize the skills and capabilities of all our citizens.

Reducing upfront costs for students would improve access to higher education and ensure that B.C. can reap the benefits of a well-educated work-force. And it’s more affordable than you think.

Conventional wisdom has it that higher education in B.C. is heavily subsidized because tuition fees don’t cover the full cost of education. But this common misconception ignores a second way in which students pay for their education: through higher taxes after graduation.

When these tax payments are added up over the course of graduates’ careers, it turns out that university students fully repay the cost of their degrees and then some.

Despite the pervasive stereotype of arts majors serving lattes at Starbucks, the reality is that higher education remains a great investment in today’s economy. University graduates experience shorter periods of unemployment, are more likely to work full-time and earn higher salaries than their peers with high school diplomas.

Census data shows that B.C. women in their 30s working full-time earned $56,000 if they had a bachelor’s degree, $40,000 with a college degree and only $33,000 with a high school diploma. For men, the corresponding figures are $74,000 for a bachelor’s degree, $58,000 for a college diploma and $50,000 for high school.

With higher earnings come higher income taxes and less need for government cash transfers like welfare and employment insurance. A new study I’ve authored for the Canadian Centre for Policy Alternatives calculates the value of the extra income taxes (net of transfers) paid by female university graduates over their careers at $98,400, and $155,400 for men. This at least than twice the actual cost to the province of a four-year under-graduate degree in one of B.C.’s public universities, $50,630, and tuition fees already cover 40 per cent of that… Read More