Does education always pay off? — The earnings development of certain graduate-level occupational titles 1995–2004

Abstract

The study examined the regular working hours earnings development of nearly one hundred occupational titles requiring higher education during 1995–2004, in relation to all wage earners, wage earners in the same employer sector, and wage earners at the same level of education. In addition, the impact on the earnings development of these titles of the collective agreements on official and employment terms concluded during the review period, as well as the separate pay programmes of the respective bargaining sectors, was examined. The majority of the occupational titles in the study were from the municipal sector and, within that, particularly from the female-dominated field of social and health services. The majority of titles from the state sector belonged to experts at universities and research institutions. Titles from the private sector and the church sector were also included. The primary data source for the study was Statistics Finland’s wage structure statistics.

The earnings development analysis showed that only very few of the titles examined reached the level of the general earnings index during the review period. Compared to their own employer sector, municipal sector titles performed best, but the municipal sector itself has shown considerably weaker earnings development than other sectors. Almost all state sector titles fell considerably short of both the general and the state earnings index. Church and private sector occupational titles also performed poorly.

The sluggishness of earnings development among the titles studied was also evident when annual earnings levels were compared with all wage earners and with wage earners in the same sector. The relative position of almost all titles either remained unchanged or deteriorated during the review period in relation to the comparison groups. Compared with other wage earners at the same level of education, most of the titles studied are at an earnings level that is even tens of percentage points lower. The titles have been largely unable to close the pay gap relative to other workers with equivalent levels of education. The education and qualification requirements for several titles were tightened during the review period, but changes are slow to appear in earnings development.

The equality and federation-specific increments included in the centralised incomes policy settlements have had some influence on the earnings development of the titles in years when such increments were available. When pay scales or table wages have been raised only by the minimum general increase stipulated in collective agreements, the titles have as a rule fallen even further behind the general earnings index. One reason for this is the limited extent of wage drift in the public sector.

The state sector pay programme Valpas and the church sector programme Kirpas have not, in the light of wage statistics, improved the relative earnings level of the titles studied. The municipal sector’s Kunpas programme, by contrast, raised the earnings of municipal sector titles in the final year of the review period. Correcting the accumulated lag would, however, require several years. (AI translation)

• ISSN: 1795-2832
• ISBN: 978-952-209-027-1
• Press Release in Finnish
• Publication in PDF-format