Stay in School, Earn More Money

Looking for an excuse to stay in school or a good argument to keep someone else on that path? How does $11,000 a year sound?

I came across an interesting study last week during the annual bender of back-to-school-related news. In general, people understand that dropping out of school means reduced access to good jobs, higher salaries, benefits and the like. But people likely don't realize they can expect to lose $11,000 in wages and extra expenses each year if they don't complete high school.

It turns out that Canadians who drop out earn $3,000 a year less than those who complete high school alone. They also stand to miss out on another $8,000 a year in wages and additional expenses when it comes to illness and health-related costs.

This data comes from a Simon Fraser University study, commissioned by the Canadian Council on Learning (CCL), called 'Cost Estimates of Dropping Out of High School in Canada,' by professor Olena Hankivsky.

Professor Hankivsky puts the private earnings losses at $3,491 each year, for a lifetime total of $104,222. The overall numbers are probably conservative too -- "lifetime" in this case is a 35-year span, which assumes earnings start at age 20 and continue until age 54.

According to the CCL report, Statistics Canada says approximately 20 per cent of Canadians over age 20 haven't completed high school. The study also examines and estimates criminal justice system costs and social assistance costs for those who drop out -- $220 and over $4,000 per year per high school dropout respectively, which works out to a $350 million hit to the justice system and a $969 million bill for social assistance each year.

Tax revenue also suffers when Canadians don't graduate. Overall, Hankivsky says the estimated total cost-savings (tax revenues, justice system costs and social assistance costs combined) that would result from a one percentage point increase in the Canadian graduation rate rings in around $7.7 billion each year.

The impact to individuals, though, is probably the more persuasive argument. "Evidence suggests that staying in school makes people healthier," Hankivsky writes. "Scientific literature shows strong associations between education and health across a range of illnesses."

Additional health costs incurred by those who don't complete high school work out to $8,098 each year, for a lifetime total of $211,471.

Her research also suggests that education is the second best predictor of incarceration (the best predictor is whether a person has been in jail previously): "High school leavers are disproportionately represented among prison populations. For example, in British Columbia, non-graduates represent 34 per cent of the overall population, but they make up 74 per cent of the prison population."

Finally, those who do not complete high school usually spend more time unemployed.

"High school dropouts fare much worse later in life than those who obtain more education," says the author, citing OECD reports and other studies. "An individual's educational attainment is one of the most important determinants of their life chances in terms of employment, income, health status, housing and many other amenities."

Kate McCaffery is a freelance writer in Toronto, Ontario. Visit mccaffery.ca/kate2.0/ for more information.