Which college majors pay off? A study reveals some answers

Which college majors pay off? A study reveals some answers

Students benefit from some college degrees, but not others. Many master’s degrees don’t pay for themselves. Economist Preston Cooper explains which ones pay off (although his methodology may be a bit optimistic):

The new report presents estimates of return on investment (ROI) for over 53,000 degree and certificate programs, ranging from trade schools to medical schools and everything in between. I define ROI as the increase in lifetime earnings that a student can expect from a particular college degree, after subtracting the cost of college and (critically) adjusting for the risk that she will not finish on time. If ROI is positive, then students who enroll in that degree program can expect to gain financially. If ROI is negative, then the program is unlikely to fully compensate students for the cost and risk of pursuing higher education.

Overall, 69 percent of degree and certificate programs with available data have positive ROI, meaning they usually leave students better off. Bachelor’s degrees are usually a good bet, with 77 percent having positive ROI, though there are exceptions. Two-year degrees and master’s degrees are the riskiest sorts of programs—almost half of these degrees leave students worse off.

Perhaps the most important factor associated with ROI is field of study. Among bachelor’s degree programs, typical ROI is above $500,000 for engineering, computer science, nursing, and economics programs. Other majors including political science, business, and mathematics have a decent return as well. But ROI is typically below $100,000 for majors such as psychology, English, education, and fine arts—and a significant share of these degrees have no return at all.

What if you don’t want to get a bachelor’s degree? Fortunately, there are still some good options. A vocational certificate in the technical trades—including HVAC technology, auto repair, welding, and other fields—has a higher ROI than the median bachelor’s degree. Another good option is a two-year degree in registered nursing. But field of study matters a lot below the bachelor’s degree level: a two-year degree in liberal arts or a certificate in cosmetology usually leaves students worse off…..

Nothing predicts college completion like high school GPA. … One of the most important reasons students frequently fail to see a return from college is non-completion. Starting college but not finishing often leaves students with debt they can’t repay. So what causes non-completion? Academic preparation is arguably the most important factor. Among students with an “A” average in high school, nearly 90 percent of those who start college finish within eight years. But among students with a “C” average, the completion rate is just 33 percent.

The study, issued by the Foundation for Research on Equal Opportunity (FREOPP), can be found at this link: https://substack.freopp.org/p/does-college-pay-off-freopps-latest

The study is useful in identifying majors that don’t pay for themselves, and those that are more lucrative. But it may overstate the value of a typical major a bit, because people who go to college are somewhat more intelligent on average than those that don’t. So even if a college degree holder earns a bit more money than someone who never attended college, it may be because of their higher native intelligence, not anything they learned in college or any prestige they got from their degree.

The average college student has an IQ of 102, compared to the average American IQ of about 98. The average IQ of young adults who don’t go to college is about 94. So college students would be more intelligent than the average person, even if they had never gone to college.

The average college student used to have a much higher IQ (around 117), back when only the brightest people went to college. As science writer Rolf Degen notes, a recent study in Frontiers of Psychology shows “the average IQ of undergraduate students… declined by approximately 0.2 IQ points per year” since the mid-20th Century as more people enrolled in college.

The benefits of college are a combination of some students actually learning something useful, and others signaling to an employer that they at least were smart enough to get in to a selective college, or smart enough to graduate, even if they didn’t actually learn much of use in college. Many students learn little in college and can’t write coherently when they graduate. Nearly half of the nation’s undergraduates learned almost nothing in their first two years in college over a decade ago, according to a 2011 study by New York University’s Richard Arum and others. Thirty-six percent learned little even by graduation.

LU Staff

LU Staff

Promoting and defending liberty, as defined by the nation’s founders, requires both facts and philosophical thought, transcending all elements of our culture, from partisan politics to social issues, the workings of government, and entertainment and off-duty interests. Liberty Unyielding is committed to bringing together voices that will fuel the flame of liberty, with a dialogue that is lively and informative.


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