The Council of Canadian Academies (CCA) released a report titled “Degrees of Success” in 2021, which revealed the main challenges that PhD students in Canada face when moving into the labour market. PhD candidates bring important skills and highly specialized knowledge to many sectors, but struggle to enter the workforce.
“Many PhDs face significant challenges entering the labour market after graduation. A lack of demand from employers, among other factors, is contributing to the underutilization of PhDs in the workforce,” the CCA report found.
Lack of demand and earnings disparities for PhD graduates
The lack of demand for employees with PhDs is particularly true for sectors outside of academia, which have not increased their rate of employing PhDs. The private sector is most likely to employ graduates in engineering, and is least likely to employ those in the humanities.
Traditionally, individuals with PhDs aim to attain a tenure-track position at a university. However, this ideal is fast becoming outdated as fewer tenure-track positions become available. Simultaneously, more people graduate with PhDs every year. According to the CCA’s report, the number of tenure-stream professors in the past decade has stayed consistent, but the number of assistant professors has been declining. This means that there are fewer new positions for new faculty.
Business PhDs outearn all other disciplines; science and humanities PhDs earn the least. The CCA report asserts that lower paying roles such as sessional instructors and postdoctoral fellows are most common in the humanities and sciences disciplines during the first five years after graduation, which could contribute to the lower earnings potential for PhD graduates in those areas.
Adjusting from academia to the workplace
Academic culture can be a hurdle too. Rates of depression and anxiety in PhDs are higher than the rates found in the general population, and “may be exacerbated or caused by the high demands and expectations of academic culture.” This is, in part, due to burnout for students in the sciences, although those in the social sciences and humanities are isolated due to independent research and writing.
An additional challenge is the ‘skills awareness gap,’ defined as the lack of recognition of an individual’s own newly gained skills and abilities. PhDs tend to be less aware of the skills they gained during their time in graduate school, and may also be unaware of career options that are not in the academic sector.
U of T’s School of Graduate Studies (SGS) created The 10,000 PhDs Project, an initiative which tracks the employment status of 9,583 PhDs who graduated from U of T between 2000 and 2015. Their research seems to support the skills awareness gap and found that the single largest employer of surveyed graduates is academia at 59.4 per cent, followed by the private sector at 21.8 per cent, the public sector at 11.6 per cent, the charitable sector at 3.5 per cent, and the “individual sector” at 3.6 per cent.
Other factors influencing employability
The CCA report, which bases its statistics on the 2016 census, finds that PhD unemployment in Canada is lower than the total unemployment rate by 2.6 per cent. Unemployment tends to be gendered, with women having higher unemployment rates than men in seven out of 10 disciplines. Underemployed people — which the CCA report uses the definition from Statistics Canada to describe as “those who are ‘part-time workers who would prefer to be working full time’ or those in roles where [their] skills are not fully used or when the job is considered substandard because of wages or other employment characteristics” — are more likely to be women.
A person’s native language appears to have an effect on unemployment rates as well; native English and French speakers have similar unemployment numbers, but unemployment rates are doubled for native speakers of any other language.
Unemployment rates for younger PhDs are higher when compared to older cohorts. For example, those between the ages of 25 to 34 have an unemployment rate of 7.1 per cent. The unemployment rate for people in the 35 to 44 years age group is 5.9 per cent. The data seems to suggest that recent PhD graduates do not have the employment opportunities available to them that earlier PhD graduates enjoyed at the same stage of their careers, but the reasons for this are unclear.
Regarding salary and earnings, PhD holders generally see higher earnings when compared to bachelor’s or master’s degree holders. While women’s earnings are going up, they continue to lag behind men’s. Similarly, compared to international students, domestic students consistently earn more.