Labor market outcomes for doctoral graduates in Japan: Evidence from a large statistical survey

Abstract

Amid growing concerns about Japan’s declining research capability, policies to support doctoral human resources are actively discussed and implemented. This study uses micro data from the 2022 Employment Status Survey to document the labor market outcomes of postgraduates, distinguishing doctoral and master’s graduates. According to the analysis, first, the employment rate of doctoral graduates is higher than that of master’s graduates, with the difference particularly pronounced among females. Second, on average, doctoral graduates are paid 40% more than master’s graduates, and the proportion of low-wage workers is smaller among doctoral graduates compared to those with a master’s or four-year university education. Third, when controlling for detailed industries and occupations, the wage difference between doctoral and master’s graduates reduces to about 10%, suggesting that doctoral graduates tend to self-select into higher-paying jobs. Fourth, the discounted present value of lifetime earnings is estimated to be 17% higher for male and 36% higher for female doctoral graduates compared to master’s graduates. Based on some assumptions, the internal rate of return on investment in doctoral education is estimated at around 10% for both males and females.