The General Educational Development (GED) credential is an international testing program for adults without a high-school diploma. It is administered by the American Council on Education. The test is accepted by most employers and some post-secondary institutions as the equivalent of a high-school diploma. GED tests are available in all Canadian provinces and territories, in all of the United States, and in several other countries. In 2002, more than 1 million adults worldwide completed the GED Tests (GED Testing Service, 2005). Test content is similar in all locations, but the test used in Canada has been modified slightly to fit Canadian standards. The French version of the GED, recognized by the American Council on Education (ACE) and used across North America, was developed by the Québec Ministry of Education.
To write the test, an individual must either be 18- or 19-years-of-age or over (depending on the province) – 16 or over in Québec – and out of secondary school for at least one full year.18 Test costs vary by province but are typically between $80 to $100. Many private companies and continuing education institutes offer courses to help students prepare for the test. The cost of these courses varies depending on the course length and the service provider. Individuals who are eligible for Employment Insurance may be eligible for funding to cover the costs of course preparation through the Skills Development Employment Benefit (SDEB). Depending on the province, individuals on social assistance may also be eligible for funding. Some employers also have an educational reimbursement policy that covers all or part of the GED preparation courses.
The test takes about 7 hours to complete (usually spread over two days). The test is composed of five tests in the areas of reading, social studies, science, writing and mathematics. Individuals who fail one or more of the tests may apply to rewrite these tests. Depending on their test score, there may be a mandatory three-month waiting period before they can write the test again.
Introduced in 1996, the GED is also relatively new to Canada. We did not find any Canadian evidence on the labour market outcomes of GED recipients. In contrast, in the United States, economic benefits of the GED have been studied extensively. While it is unclear how well the US results would generalize to the Canadian labour market, in the absence of Canadian data, the US results are worth reviewing.
In the early 1990s Cameron and Heckman (1993) published a much cited paper showing that GED holders are not the equivalents of regular high-school graduates in terms of standard labour market outcomes such as annual earnings, wages, and employment. With this fact firmly established, subsequent research set out to compare GED holders to un-credentialed dropouts. The key finding of this literature is that benefits of obtaining a GED depend on the recipient’s initial skill level (usually measured by the highest grade of high-school the individual has obtained). Individuals, who left school with low skill levels and obtained a GED later in life, have earnings increases after five years that are 10-19 percent higher than similarly skilled dropouts without a GED.19 In contrast, there are no statistical differences in the labour market outcomes of higher skilled GED holders (e.g, those with some grade 12 credits) and highly skilled uncredentialed dropouts (Murnane, Willett, and Tyler, 2000; Tyler, Murnane, and Willett, 2000).
18 In Québec, prior to implementing the
GED, there was another equivalence test, the “Test d’équivalence
de niveau de scolarité” (TENS) leading to the “Attestation
d’équivalence de niveau de scolarité” (AENS). The
coverage and degree of difficulty of the GED are greater than in the TENS. For
that reason, the Ministry is still carrying both at the same time so as not
to discourage adults from upgrading their academic skills. But it is thought
that the GED will make the TENS obsolete with time.
19 These estimates are for white males. The same study found no statistically
significant effect for GED holders who are not white (Tyler, Murnane, and Willett
2000). The researchers speculate that this finding may be explained by the relatively
large number of black males who obtain a GED while in prison. If these individuals
are still in prison when earnings are measured, their observed earnings will
underestimate their true potential earnings.