Polytechnic graduates' earnings on par with university counterparts
- In 2001, the median pay of polytechnic and university graduates entering the workforce was about $32,000
People who graduate with a Bachelor’s degree from a polytechnic can expect to earn about the same as university graduates with the equivalent degree, a recent Ministry of Education study has found.
The findings fly in the face of the commonly held belief that employers favour applicants with university degrees over polytechnic equivalents, and that polytechnic degrees lead to poorer-paying jobs.
Salary gap emerges after five years of employment
The study looked at the earnings of people who graduated in 2000 with a Bachelor's degree, tracking their pay over six years. It found:
- The median yearly pay for both polytechnic and university graduates was roughly $32,000 when they entered the workforce in 2001.
- After five years there was a pay gap of $3,000, with median earnings for polytechnic graduates about $45,000 and university graduates about $48,000.
The principal author of the study, Ministry of Education tertiary sector performance manager Roger Smyth, says he would not expect this salary gap to widen further.
The findings suggest employers are not greatly influenced by what kind of tertiary institution prospective employees attended, he says.
“What the study was mainly doing is checking out if there is any evidence of labour market discrimination [against polytechnic graduates] and what we concluded is that there is not.”
- Source: Ministry of Education, ‘Does it Really Matter Where You Study?’
Discrepancies in pay within certain fields of study
While pay differences were minor across all fields of study, the report found that pay discrepancies existed within certain fields of study:
- Graduates with a university Bachelor’s degree in education, health or creative arts earned as much as 13% more after five years than polytechnic graduates with an equivalent degree.
- However, people with polytechnic Bachelor's degrees in management and commerce, or architecture and building earned marginally more after six years than their university counterparts.
Roger Smyth says the pay disparity in particular fields of study is partly explained by the different focus on disciplines that polytechnics and universities have within a field of study.
“If you look at health, where university graduates earn more after five years, it is partly because something like three-quarters of nurses in New Zealand get their degree from a polytechnic and all doctors get their degrees from universities. There is a very large pay difference between the two roles.”
Completion of Bachelor’s degree key to earning more
The report found that people who successfully completed their studies and earned a Bachelor’s degree from either a university or a polytechnic earned about 25% to 30% more than those who started a Bachelor’s degree but did not complete their studies.
Sources
- Smyth, R, Hyatt, J, Nair, B, and Smart, W, ‘Does it Really Matter Where You Study?’, Ministry of Education, February 2009, (www.educationcounts.govt.nz).
- Smyth, R, tertiary sector performance manager, Ministry of Education, Career Services interview, April 2009.
