June 11, 2008

Major in Business, Make a Bundle? It's Not Quite So Simple

Students’ choice of college major does not affect their future salaries quite as strongly as many people believe, according to a recent paper flagged today at The New York Times’s Freakonomics blog.

The paper, by the economists Daniel S. Hamermesh and Stephen G. Donald of the University of Texas at Austin, is based on a survey of several thousand Texas alumni. (Only 25.3 percent of the targeted alumni replied to the survey, and most of the paper is devoted to the methodological problem of dealing with “non-ignorable non-response bias.”)

In raw terms, the two scholars found the usual salary disparities: Nursing and social-work majors earn $48,900 per year, on average, while engineering majors bring home an average of $102,290. But Mr. Hamermesh and Mr. Donald found that “a remarkably large fraction” of those gaps appears to be explained by factors such as the students’ SAT scores, family backgrounds, and number of hours worked each week, not their choice of major per se.

They also found that — regardless of their choice of major and regardless of their mathematics SAT scores — students earn significantly more money if they take more upper-level math and science courses. “The importance of access to this information should not be underestimated,” they write. “At this and most other institutions, students have substantial latitude in most majors to supplement required courses with others; and our results suggest that supplementation with more difficult courses pays off economically.” —David Glenn

Comments

1. As is oft said, the cream rises to the top. Level of attainment in mathematics has long been a good barometer of initiative, energy, and inventiveness.

   — CW    Jun 11, 04:48 PM    #

2. Or…people who serve human health care needs (sans MDs) are naturally valued less economically in this society than the quantitative jock disciplines. Fair enough Britchky.

   Then let those engineering types getting double the yearly salary quantify and deal with the nation’s roaming mentally disturbed, physically handicapped, nursing home patients, psychotics housed now in county jails, and the troops coming back wounded from wars with traumas seen and unseen. Little wonder there is a grave shortage of people caring for the needs of others today given the financial disparities than the science of making things like gas guzzling SUVs.

   Nonetheless, today’s university students, particularly women, are finally making the tough economic choices. They are refraining more from the healing arts like traditional nursing and social work disciplines. Every dog has their day mon ami – and it’s getting costlier to convince both men and women from those blue and soiled white collar backgrounds to care professionally. They are wising up?

   — Alice    Jun 11, 05:17 PM    #

3. It’s hard to believe that taking upper-level math and science classes is important but SAT scores are not. After all, SAT math score autocorrelaties with success in math and science.

   Too bad they didn’t analyze those who took accounting classes. An accountant is a mathemetician with a job.

   — FS    Jun 12, 07:16 AM    #

4. FS, you might want to take a statistics course and learn about regression. Unless the correlation between SAT scores and upper-level math classes is perfect, which it is not, it is possible that regression will suggest that one is causally correlated and not the other. Homely example: There is a good correlation between having a name beginning with O and attendance at Irish pubs, but those two facts are not equally good explanations of traffic accidents.

   — SO    Jun 12, 08:38 AM    #

5. Amen, Alice – as a masters level counselor/social worker providing student disability services in post secondary education, I can attest to the “value” placed on my position as opposed to those imasters level folks n the business services division…I make approximately 33% LESS than they…as a baby boomer I suppose I’ll depend on a planned bullet to the head in my “dotery” since there will be no one to provide nursing home care….with all the kiddos becoming business and engineering types, I wonder who will be teaching literature, public speaking, composition/rhetoric, philosophy and history and providing childcare? The engineers I know can’t string 5 words together into a coherent sentence – Lord help us………

   — Pat Moran    Jun 12, 08:55 AM    #

6. These salary surveys are clearly not inclusive of scientific postdoctoral scholars. I know I personally earned more bartending while a student than doing high level scientific research after taking high level math and science classes. As an assistant professor I still earn less now than the kids from my high school who went to work at the local factory did right after our HS graduation.

   — AH    Jun 12, 09:56 AM    #

7. Engineers and scientists do care for the needs of others. If they didn’t, they would be out of a job.

   — john    Jun 12, 11:55 AM    #

8. I was an art major who took no math or science courses. I make 6 figures. Thinking that math is what makes someone “the cream of the crop” in mental abilities is narrow minded and dull.

   — JM    Jun 12, 12:29 PM    #

9. Alice and Pat,

   The amount of money you make has nothing to do with how much society values you. It has to do with how much someone is willing or able to pay for the product you produce. That’s the way it is, and that’s the way it should be.

   — FB    Jun 12, 01:22 PM    #

10. Get a life and a job – follow your passion!

    — J. Barton    Jun 12, 07:10 PM    #

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