– The authors found a pattern consistent with past research on majors and earnings; students who majored in STEM fields enjoy the highest earnings once in the labor market ($48,856), while humanities and education majors receive the lowest earnings ($31,236).
– Among students who majored in a STEM, social science, or professional field, African Americans trailed behind each of the other minority groups, while the reverse was true for biology, humanities, and education majors.
– Among education majors in particular, African Americans earned considerably more than their Asian/Pacific Islander and Latino counterparts.
– OLS results show significant differences in earnings by major field of study. Latinos enjoyed significantly higher earnings than their Asian/Pacific Islander and African American counterparts. Technical, scientific, and professionally-oriented majors yielded the greatest earnings. Specifically, students who concentrated their studies in the biological sciences, STEM, and professional fields reported annual earnings between 26 to nearly 40% greater than those who majored in humanities, education, and social science fields.
– The results of the PSM analysis confirm the presence of selection bias accompanying the OLS estimates. After controlling for students’ propensities to select different majors as well as controlling for major-job field congruence within fields, the coefficients of the PSM are either smaller or non-statistically significant.
– In summary, high achieving minority students who major in a STEM field in college and who obtain congruent employment in the years immediately following college experience significant earnings advantages in the labor market. STEM students without major-job congruence experienced an earnings premium of 25%, while STEM students working in congruent job fields enjoyed a 50% earnings premium.
2012 - The Earnings Benefits of Majoring in STEM Fields Among High Achieving Minority Students
This study is conceptually rooted in human capital theory.
The sample for this study consisted of scholarship applicants in the first cohort of the Gates Millennium Scholarship (GMS) program. In the spring of 2002, approximately 2 years after graduating from high school, NORC at the University of Chicago contacted the entire population of scholarship recipients and a representative sample of non-recipients, requesting their participation in the web-based survey. In the spring of 2004 and 2006, NORC again asked those scholarship recipients and non-recipients to complete follow-up surveys. The analytic sample for this study consists of roughly 57% GMS scholarship recipients, most of whom completed a bachelor’s degree by the time they completed the second follow-up survey, and about one out of every ten had attained a graduate degree within 6 years of entering college.
The dependent variable is the natural log of annual earnings, created by estimating the yearly earnings from the wages reported across the sample of non-enrolled applicants.
Explanatory variables include a) major field of study during college (categorized as (1) Biology and life Sciences (2) Mathematics (3) Computer and information sciences (4) Engineering (5) Physical science (6) Social science (7) Humanities (8) Education and (9) Professional fields) and b) major-job field congruence (a dummy variable based on the relationship between a respondent’s occupational category and major field of study).
Control variables include gender, race, age, Pell grant recipient status, father’s and mother’s educations, average SAT scores, number of AP exams taken, private school attendance (vs public school), and a high school indicator of college expectations. Non-cognitive control variables included positive self-concept, realistic self-appraisal, understanding/navigation of social system, preference for long-term goals, leadership experiences, community service, nontraditional acquisition of knowledge, strong support person, and focus. Other control variables include institutional selectivity, whether the individual had attended a private or public postsecondary institution, self-reported financial aid indicators (total grants received, total loans received, and total parental contribution), as well as degree attainment and postbaccalaureate degree within 6 years of enrollment. These variables are traditionally included in economic models that predict labor market outcomes.