Outcomes of tertiary education

The New Zealand population is becoming more skilled as more adults become tertiary qualified, with increasing numbers holding a bachelors degree or higher-level qualification. In 2007, about one in every two New Zealanders held a tertiary qualification: the proportion with a bachelors degree or higher rose from 15 percent in 2006 to 18 percent in 2007. Ten years earlier, people with a bachelors degree or higher-level qualification comprised 9.2 percent of New Zealand’s adult population.

The proportions of Māori and Pasifika peoples holding a bachelors or higher-level qualification are steadily increasing, although they remain considerably lower than the national average. The difference in the proportion of males and females holding a bachelors or higher-level qualification has narrowed in all ethnic groups, and females with tertiary qualifications increased at a greater rate than males. In the younger age groups – those under 40 years of age – proportionately more women than men held a bachelors or higher degree. On the other hand, more young men than women held a non-degree tertiary qualification in 2007.

Strong economic growth coupled with tight labour markets continued in 2007 and this narrowed the gap in the unemployment rate between those with bachelors or higher-level qualifications and those holding a non-degree tertiary qualification. Also, the labour force participation rate increased in 2007 for those with only a school qualification or without any qualification. Consequently, the proportion of the labour force with a tertiary qualification fell slightly in 2007.

People with higher-level tertiary qualifications continued to show a significant earnings advantage over those with a lower-level qualification or no qualification. The median hourly earnings premium increased in 2007 for those with non-degree tertiary qualifications and school qualifications, compared with those with no qualification. This increase suggests a weakening of the labour market for people with no qualifications.

In 2007, the proportion of people aged 15 to 19 years not in employment or formal and informal study decreased slightly, while it increased for people aged 20 to 24 years.

The educational inheritance of New Zealanders is discussed in the chapter on tertiary education outcomes (chapter 4). The study analyses data from the Adult Literacy and Life Skills Survey held in 2006 and shows that adults whose parents had undertaken tertiary education were more likely to have a tertiary education. However, in 2006, people whose parents had only lower secondary education were more likely to have a tertiary education than they were 10 years earlier. In fact, an index of educational opportunity shows that educational opportunity has increased, not narrowed, since 1996.

A second article, also based on data from the Adult Literacy and Life Skills Survey, discusses how higher-level education is associated with greater skills. Also presented in the outcomes chapter is an article that looks at recent literature on the link between tertiary education and productivity and possible reasons why labour productivity has not grown as fast as may be expected given the growth in tertiary qualifications. Finally, the results of a study of the relationship between education and wellbeing are presented; these suggest that education can provide improvements in wellbeing but that skills and income are more important predictors of wellbeing.