Twenty-five-year old Nicole Stockdale graduated from university four years ago and is still struggling to find her dream job working as a probation officer for young offenders. To add to the pressure, she says she doesn’t earn “nearly enough” money to pay off her student debt and live comfortably – and as a result, plans to go back to school.

She’s not alone.

Almost half of undergraduates in Canada go on to pursue further studies, and those who do end up reporting higher earnings, according to Statistics Canada’s 2013 National Graduate Survey, which examined graduates from public and private post-secondary institutions in Canada.

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As students prepare to head back to school, the question of whether it’s worth investing hundreds of thousands of dollars into post-secondary education is weighing on many young Canadians, as mounting debt and diminishing job prospects will be a reality for many of them.

“I would have taken a different post-secondary route,” Stockdale said, looking back at her decision to attend the University of Guelph for criminology and public policy. “I most likely would have gone to college instead, as I don't think having my degree has landed me any amazing opportunities, especially in my field.”

Stockdale works in sales as a fitness advisor in Toronto but plans to enroll in a college program to earn a diploma for social work – her new dream field – soon.

“I think we are actually overselling the idea that everybody who wants a university degree should be able to go,” Ken Coates, professor and Canada research chair in regional innovation at the Johnson Shoyama Graduate School of Public Policy, told BNN in an interview. “I think we are just not being careful enough about who we are sending to university and what they’re studying when they are there.”

He explained that pushing more and more young people into university is “a really bad idea” because there are “not enough jobs out there.”

Ontario’s new grant

The Ontario government doesn’t want to limit the number of people who attend university and is actually trying to make it more affordable for students in low-income families.

The provincial government introduced free tuition for students in low-income families when it delivered the latest budget in February. The grant applies to students in families who earn a combined $50,000 per year or less and won’t come into effect until the 2017-18 school year.

Is sending your child to university really worth the investment?

30 per cent of kids who are going to university now shouldn't be there according to Ken Coates, Canada Research Chair at the University of Saskatchewan - and that's partially why he thinks Ontario's new tuition grants are a "seriously bad idea."

Other provinces said they would look at Ontario’s policy down the road to see if it’s effective before implementing something similar.

Ross Finnie, director of the University of Ottawa’s Education Policy Research Initiative, told BNN Ontario’s policy is the “boldest” and “most innovative” move the government has initiated related to student finances in “at least a couple of decades.”

But Coates doesn’t necessarily see the initiative as a good idea because it risks flooding the job market even more. 

“What Ontario is trying to do is target the money more to people of low income. And one of the things we’ve seen over the last 10 years is a decline in the number of people in low income family going to university,” Coates said.

Even though students like Stockdale aren’t finding the jobs they want after investing thousands of dollars into their education, young Canadians are still attending university in droves.

Over two million people enrolled in a Canadian post-secondary institution in the 2013-14 school year, according to StatsCan. Of those, 1,300,400 were enrolled in university.

Weighing the cost of higher education

The stagnant job market is not only making it difficult for young people to find jobs that relate to their field of study, but it's keeping graduates under a pile of debt that they are struggling to pay off.

Canadian full-time students in undergraduate programs paid 3.2 per cent more on average in tuition fees in 2015-16 compared to the previous school year, according to StatsCan; but Finnie points out that the rise is mostly due to inflation and that “student debt also increased as students were allowed to borrow more.”

Getting your student's financial house in order for back-to-school

RBC Wealth Management's Abby Kassar gives BNN her financial planning tips on the tax benefits and tuition grants post-secondary students and parents can take advantage of before heading back to class.

At least half of university students are forced to rely on either private, family or government loans to attend university and, as StatsCan’s National Graduate Survey revealed, only a third of those loans were paid off within the first three years of graduating.

The study also found that undergraduate and master’s students in the class off of 2009-10 were left with an average $26,000 in debt. That number was substantially smaller among college graduates, who owed at least $14,900.

But it’s not all doom and gloom for young graduates.

A study conducted by Finnie’s Education Policy Research Initiative found that over a 13-year period, graduates across all fields earned between $41,000 and $47,000 in their first year after graduation, but those earnings generally increased substantially over time.

“What my analysis shows is that [graduates] are in general making quite a bit more than the barista myth they have been fed would suggest,” Finnie said.

The study also found that earnings potential varied, depending on the faculties students graduated from. It found the most volatile earning patterns were among those who graduated from business, computer science, engineering and natural sciences programs.

Assessing alternate options

The pressure of attending university can weigh on students who may be better-suited for other post-secondary options, like college, apprenticeships or polytechnics.

While these choices are often overlooked, they are usually less expensive and less time consuming.

Finnie pointed out that, overall, university graduates still earn “considerably more” than college graduates, but acknowledged university is not for everyone.

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Britney Elliot

Some students, like 21-year-old Britney Elliott, prefer the more hands-on approach of college programs. 

Elliott decided to study advertising and marketing communications as part of a three-year program at Durham College and said she doesn’t regret her decision.

“I strongly believe my program prepared me for the industry,” she told BNN. “I feel I learned so much more doing things hands on rather than just sitting in a lecture. It also gave me enough experience to start my own freelance business doing social media and marketing.”

Apart from freelancing, Elliott is currently working as a claims assistant at a boutique injury claims firm until she finds a full-time job in advertising.

While university is still a more popular choice, college enrollment levels are on the rise. In 2013-14, enrollment increased to 747,576 from 429,243 a decade ago, according to StatsCan.

One of the reasons young people choose university over college is pressure from their parents, who, according to Coates, are “overwhelmingly enthusiastic” about sending their children to university.

“We’ve got this idea in our heads that if you’re a good parent, you get your kids to university almost at all costs, even if you know they’re not likely to succeed,” he said.

Tuition and other expenses for a four-year university degree could cost more than $60,000, according to a 2013 report from BMO’s Wealth Institute. The report also found that 83 per cent of parents expect to pay for their child’s college or university costs, with 44 per cent expecting their child will contribute too.

While many students rely on their parents for financial support during their post-secondary education, Finnie said that it’s up to the student to determine the path that’s most suitable for them and cautions against getting too fixated on deciding what their final occupation will be.

“The world does not owe you a job,” he said. “That’s for you to get ready for, find, and do your best to make to into what will wind up being your career.”