Take a look at a very interesting article by Phil Izzo, “Which College Majors Pay Best,” in the Wall Street Journal. Izzo spotlights research by Joseph G. Altonji, Erica Blom and Costas Meghir of Yale University, showing which college majors generate higher earnings after graduation.
Not surprisingly, certain majors – notably those requiring math skills – lead to higher earnings once on the job. What is rather astonishing is the size of the disparity. According to the research, “the gap in wage rates between electrical-engineering and general-education majors is nearly as large as the difference between college graduates and high school graduates.”
The highest wages go to economics majors, with engineering and finance grads close behind. At the bottom are education, music and drama, and fitness and nutrition majors. (This won’t be a surprise to anyone, but it does give you pause when you couple the results with the supposedly growing “math and science illiteracy” of American students).
The takeaway: The article has a great sortable chart showing earnings by major. Of course, your choice or your child’s choice of college major depends on many factors, and the lifetime income potential is only one of many elements to consider. We don’t mean to suggest it should be the primary, or even one of the top, criteria. However, we do believe it should be a factor when determining how much you should spend or borrow for college. If you know you are going into a lower-paid career, think twice about racking up hefty debt. Even if you absolutely love your career choice, that debt burden may be too heavy to bear and compromise your post-grad quality of life.