I've written before about the negative academic consequences for students who work while studying (see here or here). However, it's not certain theoretically whether working is always bad. In fact, there are a number of reasons to believe that working might be good for students in the long term. First, working might allow students to develop skills and knowledge that are valuable in the labour market later. Those skills may or may not be complementary to what they are learning in their studies (and any positive labour market effects are likely to be higher for complementary skills). Second, working might develop social skills, networks, and contacts that make it easier for students to find work after they graduate. Third, working might act as a positive signal of ability, conscientiousness, or effort, for future employers. On the other hand, working while studying comes with an opportunity cost of time spent studying, which may have negative impacts on grades, persistence, and learning (as shown in the study I discuss in this post).
With both positive and negative impacts of working while studying, what is the overall effect? I was hoping that this 2012 article by Regula Geel and Uschi Backes-Gellner (both University of Zurich), published in the journal Labour (ungated version here), would provide some answer to that question. They use longitudinal data on 1930 Swiss graduates from the year 2000, followed up one and five years after graduation. Importantly, their dataset distinguished between students who did or did not work while studying and for those who did work, it distinguishes between those who did or did not work in jobs that were related to their field of study. Now, the problem with this sample is that it is a sample of graduates, so naturally it excludes those who dropped out of university. So, it doesn't answer the overall question of the impact of working while studying on subsequent labour market outcomes, although it does provide some answer for those students who do graduate.
Geel and Backes-Gellner control for ability (using secondary school grades), motivation (based on a question that asked students how important a new challenge is), and 'liquidity' (using parental education, on the basis that students with more educated parents have more financial resources available to them and are less likely to need to work). Looking at a range of labour market outcomes one year after graduation, they find that:
...student employment per se reduces the probability of being unemployed 1 year after graduation, compared with having been a non-working student... field-related student employment reduces unemployment risk compared with having been a non-working student. Furthermore, field-unrelated student employment also reduces the unemployment risk. Consequently, students working part time in jobs related to their studies have a significantly lower short-term risk of being unemployed than both non-working students and students working part time in jobs unrelated to their studies.
...student employment significantly reduces job-search duration compared with full-time studies. Moreover, after including information about the type of student employment, we still find that field-related student employment significantly reduces job-search duration but we do not find a significantly different effect for field-unrelated student employment compared with full-time studies.
...students working part time can expect higher wages than non-working students. Again, when we differentiate the type of student employment we find that only field-related student employment, compared with full-time studies, generates such positive effects, but not field-unrelated student employment.
That all seems positive. They don't discuss the size of the effects in the text, but part-time employment while studying appears to be associated with by 1.4 percentage points lower probability of being unemployed (2.4 percentage points for those employed in work related to their study field, and 0.9 percentage points for others). It is also associated with 0.13 months shorter job search duration (and 0.29 months for those employed in work related to their study field), and wages that are 1.5 percent higher (and 2.5 percent higher for those employed in work related to their study field).
Moving on to outcomes five years after graduation, Geel and Backes-Gellner find similar effects. At that point, part-time employment while studying is associated with by 1.3 percentage points lower probability of being unemployed (1.8 percentage points for those employed in work related to their study field, and 1.0 percentage points for others). It is also associated with 0.7 percent higher wages (and 1.2 percent higher for those employed in work related to their study field). Interestingly, there is no overall impact on self-reported job responsibility (being 'great' or 'very great'), but there are statistically significant effects in opposite directions for those who were employed in work related to their study field and those who were not. Those who were employed in work related to their study field were 1.6 percentage points more likely to report great job responsibility, while those who were not employed in work related to their study field were 1.3 percentage points less likely to report great job responsibility.
Now, despite Geel and Backes-Gellner taking great care to control for a range of other variables, these are not causal estimates, they are correlations. There is likely to be selection bias in which students choose to undertake work while studying. Geel and Backes-Gellner point out that only 4 percent of working students are receiving a scholarship, but they don't tell us how many of the non-working students receive scholarships. However, since better students receive scholarships, and scholarships make work less necessary, any selection bias from scholarships would actually tend to decrease the observed positive labour market effects of working. On the other hand, if better students are more likely to work because they feel like they can better cope with the competing demands on their time, then the observed positive labour market effects of working would be overstated. For me though, the bigger issue is that these results are conditional on graduating. We don't know to what extent working while studying was associated with dropping out, rather than graduating.
Overall, this paper provides some food for thought. Working while studying might provide some benefits for some students.
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