Highly educated people are not necessarily better earners, according to a research presented at the Royal Economic Society Conference this week. Study researchers Dr. Matt Dickson and Dr. Franz Buscha found that job experience is more valuable than more years spent studying in school.
Their study involved analyzing data from the Office of National Statistics (ONS) New Earnings Panel Dataset. The researchers studied the effects of the 1972 reform in education, where the length of schooling was increased from the minimum school leaving age of 15 to 16.
The team found that those who were born after the education reform had more earnings lost than those who left school early, at least in the first few years of their working lives. An additional year of going to school meant less job experience and a loss of £45,000 from full time work.
However, researchers found that men with additional schooling yielded positive benefits on their later working years starting in their mid-30's, as per Phys.Org. The study is the first one to be conducted that looks at the impact of the reform at the early part of working careers.
Dr. Dickson notes that when teenagers enter the workforce, they are also competing for jobs with others who have left school a year ahead of them. However, these teens could have an advantage over their competitors, given that they have more job experience.
"In the case of this reform, staying longer in school meant that the affected young people were two years behind," explained Dickson. "This is really important at the start of a career and made it more difficult to compete for jobs, meaning that they began on lower wages and took more than a decade to close the gap."
In addition, the research also reiterated the importance of letting children learn more useful skills during their schooling years. Apparently, this will help reduce the gap between non-existent work experience once they leave school. Dr. Buscha adds that there should be some sort of arrangements to help fresh graduates cope with the job market as well.
In modern times, some teenagers do part time to full time work in order to support their needs and sometimes even their education. Some pupils earn minimum wage due to lack of experience or when pursuing entry-level jobs. According to the Bureau of Labor 2013 statistics, more than 1.5 million Americans earn minimum wage and approximately 1.8 million workers earned less than $7.25 an hour.
