Following high school graduation, some students decide to delay their postsecondary education (PSE). This raises the issue of the long-term implications of taking a gap year. On the one hand, youth who choose this path substitute one year of lower-paying, pre-PSE work (or non-work) (i.e., the opportunity cost may be high). On the other hand, the additional year may be well needed for youth who are still discovering what they want to do for the rest of their lives. They may come back to school with greater career focus or more maturity, which could lead to improved labour market outcomes in the
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Following high school graduation, some students decide to delay their postsecondary education (PSE). This raises the issue of the long-term implications of taking a gap year. On the one hand, youth who choose this path substitute one year of lower-paying, pre-PSE work (or non-work) (i.e., the opportunity cost may be high). On the other hand, the additional year may be well needed for youth who are still discovering what they want to do for the rest of their lives. They may come back to school with greater career focus or more maturity, which could lead to improved labour market outcomes in the long term.
The main question asked in this study is, 'Among high school graduates who eventually registered for postsecondary studies, how do the long-term labour market outcomes compare between those who took a gap year (i.e., began their PSE between 12 and 15 months after high school graduation) and those who followed a more linear path into PSE (i.e., began their PSE within 3 months of high school graduation)?' The analysis is based on data from the Youth in Transition Survey, Cohort A, which is linked to the T1 Family File, and takes into account differences in a very rich set of characteristics, including academic performance, cognitive and non-cognitive ability, parental characteristics (presence, education, aspirations and education savings behaviour), peers, and high school fixed effects.
The findings suggest a substantial negative association between taking a gap year and cumulative earnings among individuals who enrolled in a degree program shortly after high school. Specifically, men who took a gap year before enrolling in a degree program earned $57,448 (2015 constant dollars), or 11.6 per cent, less from the ages of 17 to 31 than their counterparts who did not take a gap year. Similarly, women who took a gap year prior to enrolling in a postsecondary degree program earned $49,788 (12.5 per cent) less over the same time span than their counterparts who did not take a gap year. Based on annual data, the negative association between taking a gap year and earnings grew more or less consistently in an absolute sense as individuals aged, at least until they were 31 years old (when the data end). In contrast, taking a gap year was positively associated with earnings among men who enrolled in a non-degree postsecondary program ($70,416, or 14.6 per cent, more), while there was no association for their female counterparts. The study also found a small negative relationship between taking a gap year and other cumulative job characteristics over the period (number of years of union membership and with an employer-sponsored pension plan) among women who enrolled in a postsecondary degree program.
Published abstract.
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