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I think I answered my own question, and thought I'd share. When I saw that Ontario's per capita GDP grew by less than 1% per year on average for the past twenty, my jaw dropped. I don't have much data handy, but I do have the labour productivity numbers. Since 1997, Ontario's real value-added per hour of work grew at an average annual rate of 1.3%. If the participation rate, and average hours worked, are also falling, then the GDP/capita numbers are believable. Anyway, am I the only one shocked at this poor performance? Education spending is growing faster but is it not translating into productivity growth? Should we spend more on education in response? Or, taxes to pay for education are inhibiting growth?

Lots of good stuff in the post, sorry if this comment is out of left field.

One of the tricks over this period is that participation rates have grown, so you could have spending on PSE exceeding the growth of GDP and still have per student spending fall - which I think is interesting if you're looking at productivity growth - are we really spending more on teaching students or are we merely short-changing increasing numbers?

Keep in mind a large chunk of students educated in Ontario do not find jobs or do not find them in Ontario.

Please excuse this question: did admin go from 17 to 21% or from 22 to 27%? I can't see the colour on the legend.

17 to 21

Trevor hit a key point.

From my experience at various employers the problem is not people, nor their education, the problem is money and management. Management is unwilling to invest in productivity increases because they feel the rate of return from such improvements is insufficient and the risk with such projects is to great.

They do not want to invest additional capital. We have a management and capital problem, not an education one.

You cannot increase productivity without capital investment and training. Both are shortchanged at present, in my opinion.

"When I saw that Ontario's per capita GDP grew by less than 1% per year on average for the past twenty, my jaw dropped."

I guess the obvious question is why anyone would think that increasing spending on post-secondary education would affect productivity? Sure, if post-secondary education developed valuable skills in students, that might increase productivity. And while I'm quite happy to concede that a post-secondary education CAN impart valuable skills in students (and not just technical skills, but general skills such as critical thinking, and the ability to think and write coherently), I have my doubts about whether that is the actual experience of many Ontario graduates (and, indeed, whether many Ontario university students actually have any interest in acquiring those skills, or whether they're just in university for the piece of paper that says they went to university).

Moreover, over-education might well hamper productivity (or, at least, per capital GDP growth). Take my grandmother, as an example. She was an elementary school teacher back in the day. She had a high school education and attended 1 year of normal school (what is now the equivalent of teacher's college). If my grandmother were a teacher today, she'd have a 4 year university education, 1-2 years of teachers college (depending on the province) and, in all likelihood, a masters degree of some sort. And I'll wager that her students would be no better educated than they were 70 years ago (indeed, given the recent fads among the educrats, the odds are good they be less well educated than they would have been 70 years ago). The adverse productivity effects of over-education in this context should be obvious, today's teachers devote 5-8 years of their lives (and considerable public and private resources) in otherwise unproductive activity (i.e., being educated) without any long-term benefit for society as a whole (i.e., they aren't materially better teachers).

And while I pick on teachers, I suspect that is probably true of many sectors in our economy where employers insist that people obtain the credentials of a university education, when the skills acquired at university (if any) aren't really required to do the work being asked of them (or are skills, like the ability to write a coherent letter to your boss, that 70 years ago would have been acquired in high school). No wonder per capita GDP stagnates, when an ever increasing chunk of young workers devote an every increasing chunk of their lives and their resources to (economically) unproductive activities ( no doubt, a university education can be life-enriching and entertaining without being economically productive - but few people try to justify a post-secondary education, much less public funding for it, on the basis that its a consumption good).

What the hell is "Other Post-Secondary Education Expenses"? Given the amount it costs, this would be good to know.

Hey Livio,
Did you get all your data from StatsCan? I want to try and replicate what you've done, just for practice.
Is excel a good way to work with the numbers?? What program would you suggest?

"What the hell is "Other Post-Secondary Education Expenses"? Given the amount it costs, this would be good to know. "

I was thinking it might include research spending.

Simon:
All of the variables came from Statscan. I used Excel. Please send me an e-mail and I can send you the Excel file. Cheers. Livio.
Jim:
I would like to know what is in this category also. I also thought it might be some aspect of spending related to infrastructure and support perhaps for the research and teaching side but I really do not know.

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