Drilling down on training pathways

We present a more detailed income breakdown of degrees at university and sectors of training within ITOs

The results in this report are not official statistics. They have been created for research purposes from the Integrated Data Infrastructure (IDI), managed by Statistics New Zealand.

The opinions, findings, recommendations, and conclusions expressed in this report are those of the author(s), not Statistics NZ.

Access to the anonymised data used in this study was provided by Statistics NZ under the security and confidentiality provisions of the Statistics Act 1975. Only people authorised by the Statistics Act 1975 are allowed to see data about a particular person, household, business, or organisation, and the results in this [report, paper] have been confidentialised to protect these groups from identification and to keep their data safe.

Careful consideration has been given to the privacy, security, and confidentiality issues associated with using administrative and survey data in the IDI. Further detail can be found in the Privacy impact assessment for the Integrated Data Infrastructure available from www.stats.govt.nz.

The results are based in part on tax data supplied by Inland Revenue to Statistics NZ under the Tax Administration Act 1994. This tax data must be used only for statistical purposes, and no individual information may be published or disclosed in any other form, or provided to Inland Revenue for administrative or regulatory purposes.

Any person who has had access to the unit record data has certified that they have been shown, have read, and have understood section 81 of the Tax Administration Act 1994, which relates to secrecy. Any discussion of data limitations or weaknesses is in the context of using the IDI for statistical purposes, and is not related to the data’s ability to support Inland Revenue’s core operational requirements.

In this report we present the income outcomes of training pathways within different organisations. Because we are drilling down to a narrower resolution, we expand our cohort to an average of 19 year olds starting training from 2003 to 2007 to increase sample size. We find that university graduates surpass ITO trainees in terms of income in their late twenties.

To investigate the income outcomes of different areas of training, select the drop-down menus on the right of the chart (▶).

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Methodology

To conduct this analysis we took a cohort of 19 year olds in each year of 2003 from Ministry of Education and IRD tax records. Based on study enrolments we classified each 19 year old with a heirarchy of:

Industry Training Organisation
University
Institute of Technology or Polytechnic
College of Education
Private Training Organisation
Wananga
Within IRD tax records (No training enrolments)

Within these groups, we check if they have completed a qualification with the providers. Each subsequent year, we track total yearly income of each individual still actively enrolled in study or earning income in IRD tax records, thereby removing anyone from the analysis that moves overseas or is otherwise lost from records. Across the groups we summarise the average earnings at each age.

Only income from Student Allowance, Wages and Salaries, and Business Income of the source codes ('C00', 'C01', 'C02', 'P00', 'P01', 'P02', 'S00', 'S01', 'S02') are considered. An individual is only classified as actively in IRD records from earning one of these sources each year. Training areas are derived from the industry/occupation code the Ministry of Education holds on record for each course of study.

In terms of cumulative income, we find ITO trainees are still above their university counterparts going into their mid-thirties.

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Methodology

Cumulative income is calculated through the summation of previous years' average income. Note that this does not adjust for tax, inflation, potential for returns from savings and investment, or incorporate student loans.

To conduct this analysis we took cohorts of 19 year olds in each year of 2003, 2004, 2005, 2006, and 2007 from Ministry of Education and IRD tax records. Based on study enrolments we classified each 19 year old with a heirarchy of:

Industry Training Organisation
University
Institute of Technology or Polytechnic
College of Education
Private Training Organisation
Wananga
Within IRD tax records (No training enrolments)

Income outcomes

Understand how apprentices are $165,000 better off than university graduates at age 28

Controlling for innate ability

Drilling down on training pathways

We present a more detailed income breakdown of degrees at university and sectors of training within ITOs

Disclaimer

More Information

Methodology

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Methodology

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