At RealClearPolicy Brent Orrell reveals a secret that has been known to thinking people for generations:
For the better part of the last 40 years, employers, educators at all levels, and workforce development authorities have campaigned successfully to increase the number of students graduating with degrees and credentials in STEM occupations. Between 1960 and 2013, the number of U.S. STEM workers grew by 3 percent compared to 2 percent growth in all other fields, with the STEM workforce enjoying a median pay roughly twice that of non-STEM workers. Most importantly, the STEM workforce skews young, suggesting that in this area youth and exuberance are more important than age and wisdom.
The hidden downside — as the study by David Deming, a Harvard University professor of public policy, education and economics, and Kadeem Noray, a Harvard Ph.D. student, shows — is that while STEM fields pay well for recent graduates, these premiums are short-lived. They are highest at the outset of a career and decline by more than 50 percent in the first 10 years of working life. The higher the rate of technological change in a particular specialty, the flatter the rate of wage increase. This pattern is particularly true in applied STEM fields like engineering and computer science. (Other STEM majors like biology, chemistry, physics and mathematics — the pure STEM categories — do not show similar wage effects.)
More than 50 years ago my dad explained it to me like this. Engineers have high starting salaries but they plateau quickly, too. The salaries for other professions, like the law or the practice of medicine, tend to rise throughout life.
Over that period things have been clouded a bit. Physicians now have far larger income expectations than the other professions. But otherwise the situation remains the same.
I would go a bit farther than the linked article does. Engineering will be a dead end in the United States as long as we export so much of our industrial production overseas. Production engineers necessarily follow production and design engineers inevitably will follow production engineers.
How should young people respond? I can only offer my opinion. Law is a bad choice. Non-lawyers routinely provide services now that used to require lawyers. Top tier law firms are decreasing the number of associates they hire. Wages for lawyers will inevitably decline. Certain narrow, highly specialized engineering disciplines, e.g. petroleum engineering, will continue to provide good incomes for some time to come. It will be increasingly difficult to get a job earning a decent income as a electrical, chemical, mechanical, or industrial engineer other than in those narrow specialties. Those jobs are going to China and India.
MBAs from top tier B-schools will have no difficulty finding lucrative jobs for the foreseeable future but those account for, perhaps, a few thousand graduates a year.
We’re probably at peak higher education at this point. Don’t expect job openings for college professors or their wages to increase.
Higher education is worthwhile but it’s a luxury good, not a mass market commodity. For most people the trades or skilled blue collar work is probably a better choice and those require training but not higher education.
