HICKS: Most majors pay off, but some a lot more than others

A while back, a spiteful little argument erupted on campus between a columnist at the student newspaper and a professor.

The student, it seems, referred to the professor’s field as a “hobby major.” The professor responded by
calling the student a “neo-fascist-capitalist.” It is the temper of debate only a college or middle school locker
room can sustain.

Godwin’s law was clearly at work there. However, the question: “Which majors will perform best in this economy?”
is a good one. It got me thinking about how college preparation translates into employment, and what students and taxpayers
need to know.

There’s a public-policy dimension to degree choice because taxpayers subsidize college education through direct payments
to students and universities, and through subsidized loans. The reasons for doing so are both because education generally
benefits society above the benefits an individual receives, and because there are direct regional spillovers from a university
to the economy.

These spillovers come from the effects of science, technology, business education, social sciences and the creative endeavors
of those in the humanities. Universities need all of these, but the demand for trained graduates in each field differs. For
example, we need more early-childhood educators than economists.

The only real way to allocate people to the right job is through free choice in markets. Wages are the clearest market signals
of demand for particular skills, but student loans make it easier for students to ignore markets until after graduation.

Fortunately, there are studies about income for college graduates by degree. A Department of Labor study reported that, of
all college graduates, only starting salaries in humanities and “specialty” majors were below the national average
for all workers. But, within a decade, these workers saw more than a doubling of earnings, and more than a quarter finished
graduate school.

So, even college graduates with degrees in the lowest-paying major at graduation were earning, on average, more than $50,000
within a decade. Not a bad hobby.

A second indicator to students isn’t earnings, but in which fields graduates of each major work. The best students
will always find work within their fields and many will change jobs because their occupation is less fun than they thought—but
students in majors where a high proportion of graduates are working outside their field need to know the risks of this decision.

Science, engineering, business and health care graduates have high rates of related jobs. Humanities, history, psychology
and the social sciences all have almost two-thirds of graduates working outside their field in three years.

So it is clear that markets favor any college degree more than none. There is clearly something important about the totality
of what is learned in college, but, if you want to apply all those upper-level classes in your major, you’d better study
hard or pick the right field.

And, by the way, that impertinent youngster was named the top student columnist in the country, but writing was only his
hobby. He decided to become a well-paid capitalist instead.•

__________

Hicks is director of the Center for Business and Economic Research at Ball State University. His column appears weekly.
He can be reached at [email protected]

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