Women earn less than men in Canada right after graduation — then it gets worse: report

Women in Canada earn less than men almost immediately after graduation — and then the gap gets worse.

That’s according to a report released Tuesday by the University of Ottawa’s Education Policy Research Initiative and the Labour Market Information Council. The report looked at annual earnings of men and women, rather than wages, meaning hours worked were not taken into account. The research tracked students of Canadian post-secondary schools, graduating from 11 different fields of study and from five different credential levels: college-level certificate, college-level diploma, bachelor’s degree, master’s degree and doctoral degree.

On average, the report found women earn 12 per per cent points — or $5,700 — less than men one year after graduation. That difference widens to $17,000, or about 25 per cent, in the five years following graduation.

“It’s really widespread,” said Steven Tobin, executive director of the Labour Market Information Council. “Looking at five years after graduation, women earn less than men in every credential, in every field of study.”

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Tobin explained that one year after graduation, there are a few cases where women either earn the same or more than men, but that, too, disappears within five years.

While the research shows that women earn less than men across the board, the difference was more pronounced for some qualification levels.

One year after graduation, the difference in earnings is lowest, at two per cent, for those who hold professional degrees. The difference is highest, at 21 per cent, for those who have college-level certificates. Women who hold master’s degrees also earn about 17 per cent less than their male counterparts.

Five years after graduation, the highest difference in earnings is nearly 34 per cent for college-level certificate graduates and 16 per cent for those who hold doctoral degrees.

“These findings align with a vast literature that shows women face greater hurdles in the labour market than men do,” the report reads.

The report also looked into which fields of study had the largest and smallest discrepancies.

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The smallest difference found was in bachelor degree graduates in health-related fields, where women earned two per cent — or $1,300 — less than men after five years.

The biggest difference was for college-level certificate and diploma holders in education, where women earned 45 per cent — or $28,000 — less than men after five years.

The research did not look into why some qualifications had greater pay gaps than others, Tobin said.

However, he noted there are some likely reasons for the overall discrepancies, such as women working fewer paid hours while taking the lead on parenting and other family responsibilities.

Katherine Scott, a senior researcher at the Canadian Centre for Policy Alternatives, explained there are several factors that contribute to earnings gaps.

“Certainly, discrimination in hiring and pay rates still goes on,” she said. “Certainly, dropping out of the labour market to take care of children, and obviously the infrastructure in place to support families is woefully inadequate in Canada as compared to other European countries.”

Scott noted this is far from the first report that has outlined earning discrepancies in Canada, however the findings still left her surprised.

“Typically, when women have their first child, you can see the pay gap really rising. It’s called the ‘motherhood penalty’ and it affects a woman’s earnings over her lifetime,” Scott said.

“This study would seem to suggest that starts way earlier.”

The earnings gap that exists in Canada is one that several reports have outlined, including another recent one by the C.D. Howe Institute, which looked at gender and race.

The Jan. 9 report found the wage gap in Canada was 19 per cent between men and women in 2019. It said much of that difference is due to differences in jobs typically held by men and women.

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“For example, men in the private sector are more heavily represented in higher-wage industries like oil and gas, while women are more heavily represented in lower-wage industries such as retail services or accommodation and food services,” the report explained.

Beyond comparing numbers, Scott noted discrepancies in pay, job quality and the treatment of women in the workforce all have real impacts on lives.

“These sorts of pay gaps at this level and at this point will affect her course of life, her lifetime earnings extraordinarily,” Scott said. “It creates a foundation of vulnerability that is challenging for not only her well-being but her future family’s well-being.”