CHAPTER 5
Career and Economic Impacts of College
In this
chapter we summarize the accumulated evidence on the career and economic
impacts of college. Overall, the labor
market impacts of postsecondary education have remained substantial during the
decade of the 1990s; and this fact has not been lost on students about to
graduate from high school. For example,
of the 2.7 million American high school graduates in 1996, nearly two-thirds
(65%) went on to some type of postsecondary education (College
continuation rates for recent high school graduates reached record high in
1996, 1997, August). Moreover,
the reasons for attending college appear to be strongly linked to a perception
that a college degree gives one decided economic and career advantages. According to the 1997 survey of American
college freshmen by the Higher Education Research Institute at UCLA, nearly
three-fourths said that getting a better job (74.6%) and making more money
(73.0%) were the most important reasons for attending college (see also,
Flacks & Thomas, 1997; Is college still worth the cost? The private investment
value of higher education 1967 to 1996, 1998, March). We examine these labor market or occupational
attainment impacts in considerable detail, but we also look at the evidence
pertaining to other dimensions of career such as career maturity, career
progression and success, and job satisfaction.
By definition, of course, a large part of the evidence on the career and economic impacts of college concerns long-term or extended impacts. Consequently, we do not include a separate section on long-term effects in this chapter. Rather, we synthesize the evidence on such effects, where appropriate, within our other five sections.
Change During
College
Conclusions from
A consistent body of evidence suggests that students become significantly more mature, knowledgeable, and focused during college in thinking about planning for a career. Whether this is an effect of college or simply a development that occurs coincidentally with college attendance is difficult to determine. The simple fact of having to confront one’s life work may have a substantial impact on the increased maturity found in seniors’ thinking and planning for a career.
Evidence from the 1990s
The small body of evidence from the 1990s is quite consistent with our 1991 conclusion that students become more mature, knowledgeable, and focused during college in thinking about a career. For example, Luzzo (1990; 1993) sought to determine if undergraduate class standing was related to scores on a standardized measure of career maturity. Career maturity was defined as the readiness of an individual to make informed, age-appropriate career decisions and cope with appropriate developmental tasks (Savickas, 1990). Although the statistically significant relationship was not particularly strong, Luzzo found that the more advanced one’s undergraduate class standing, the higher one’s level of career maturity. While they employ different measures than Luzzo, similar results have been reported by Bowman and Tinsley (1991) for vocational realism, by Poe (1991) for stability of vocational identity and need for occupational information, and by VanHaveren, Winterowd, and Fuqua (1999) for career decidedness. Furthermore, there is also evidence to suggest that college seniors have a more accurate perspective about labor-market realities than do students in the first two years of college. Two studies indicate that seniors have significantly lower and more realistic estimates of actual starting salaries for college graduates than either freshmen (Heckert & Wallis, 1998) or sophomores (Shepperd, Oullette, & Fernandez, 1996).
Despite the consistent evidence, interpreting such differences in career maturity, career identity, and vocational/labor-market realism as an impact of college is problematic. Simple maturation or, as we suggested in our previous synthesis, the increased pressure on seniors to reach closure on career decisions may be equally valid as competing explanations for the findings.
In addition to focusing on the
different dimensions of career maturity or career identity, other research has
examined the extent to which college students are prepared to meet workplace
requirements. This work was conducted by
the Collegiate Employment Research Institute at Michigan State University (Gardner, 1998). A simulation-based assessment of a real
workplace situation was developed that tapped individuals’ competencies in such
areas as applied problem solving, interpersonal effectiveness, and
accountability. The instrument was
normed on a group of recent college graduates evaluated as performing above
average on a common job-assessment instrument.
Consistent with the evidence on career maturity, college seniors tended
to have the highest overall workplace readiness scores, while freshmen had the
lowest.
The Gardner (1998) study not only reports the relative standing of freshmen, sophomores, juniors, and seniors in workplace readiness, it also provides an absolute estimate. As alluded to above, the workplace readiness assessment produced a normed score for employed college graduates who have been evaluated as performing above average on the job. This normed score was substantially above that of the average college seniors, suggesting that, while they are more proficient than those with less exposure to college, seniors may often lack an absolute level of job skills required for above average job performance. Corroborating evidence is suggested in an additional survey of employers who first specified the absolute skill or performance levels new graduates should be expected to meet upon entry into their jobs, and then indicated the level of preparedness of college graduates they observed. While students generally appeared to be well prepared in their academic and content areas, they fell short in areas that were related to the context of work (e.g., interpersonal skills, setting priorities) and applying their knowledge in work environments (Gardner, 1998; see also Candy & Crebert, 1991; O'Brien, 1997; Van Horn, 1995).
Net Effects of College
Conclusions from
Attaining a bachelor’s degree has important implications for the type of job one obtains and for an individual’s lifetime earnings. Our best estimates were that, net of an individual’s background and other confounding influences, a bachelor’s degree (compared to a high school diploma) conferred about a 34 percentile point advantage in occupational status or prestige, a 20 to 40% advantage in earnings, and a private rate of return of between 9.3 and 10.9%. The occupational status advantage that accrued to college graduates was not simply a function of the first job obtained. Rather, the significant occupational status differences between high school and college graduates were sustained over the occupational life span, even when the status of one’s first job is taken into account. For both occupational status and earnings, there was a credentialing effect. One received a “bonus” for completing the bachelor’s degree above and beyond the increment in job status or earnings received for every year of postsecondary education.
The fact that a bachelor’s degree significantly enhanced the likelihood of entering relatively high status managerial, technical, and professional occupations has implications not only for earnings, but also for occupational stability. The very nature of jobs entered by college graduates (versus high school graduates) tended to make them less sensitive to employment fluctuations that occur with changing economic conditions. This may at least partially explain why college graduates were substantially less likely than high school graduates to be unemployed. Related evidence also suggested that college-educated individuals may have additional hedges against prolonged periods of unemployment in the form of increased accuracy of occupational information and efficiency in job search, increased regional mobility to take advantage of employment opportunities, and an increased network of personal contacts, some of which date back to college days.
Despite
the fact that one derived substantial occupational status and earnings
advantages from a bachelor’s degree, irrespective of his or her background
characteristics, the causal mechanism(s) underlying the ability of a bachelor’s
degree to confer these advantages was (were) not readily apparent. On the one hand, we found evidence to support
a socialization or human capital explanation.
That is, college imparts cognitive skills, values, attitudes, and
behavioral patterns that make the individual more productive in complex
technical, professional, and managerial occupations, and therefore more highly
paid. On the other hand, we also found
evidence supporting a screening or certification explanation. This explanation posits that a college degree
serves a screening or certification function such that those without a
bachelor’s degree are effectively barred from entry into high status/high
income careers. If college-educated
individuals are perceived by employers as more likely than high school
graduates to possess the requisite competencies and values necessary for
successful adaptation to complex technical and managerial positions, they will
continue to secure higher-status and better paying jobs irrespective of whether
the competencies and values were acquired in college. Our reading of the total body of evidence was
that both socialization/human capital and screening/certification may be part
of any causal link between postsecondary education and both occupational status
and earnings. Neither hypothesis alone
provided a completely satisfactory explanation.
College
tended to produce conflicting influences on satisfaction with one’s work. On the one hand, college tended to have a
modest positive influence on job satisfaction by placing individuals in jobs
with relatively high intrinsic (autonomy, challenge, interest) and extrinsic
(income) rewards. On the other hand,
college tended to develop a capacity for critical judgment and evaluation that
may make college-educated individuals more sensitive to the shortcomings of
their jobs. Similarly, the college-educated
were also quite likely to have higher expectations about the intrinsic rewards
of their jobs than those with less education.
The latter factors can lead to dissatisfaction in situations of
“overeducation,” where job demands do not require a college-level education.
Evidence
from the 1990s on the net career and economic impacts of college differs
somewhat in focus from the evidence we reviewed from our 1991 synthesis. In our present synthesis we found
substantially less evidence on such topics as occupational productivity, job
satisfaction, and job success, but substantially more on the economic returns
to different levels of postsecondary education.
In reviewing this evidence, we have had the benefit of several excellent
literature reviews (e.g.,
Boesel & Fredland, 1999; Grubb, 1998, August; Paulsen, 1998), which has made the
locating of studies and the development of this chapter substantially
easier. Still, the body of evidence is
extensive. Thus, in an attempt to
provide some organizing structure we present the evidence in the following
categories: occupational status, workforce participation, job
satisfaction/performance, earnings, credentialing effects, private rate of
return, and causal mechanisms.
Occupational
status can be generally regarded as a hierarchy of occupations that reflects
their prestige or desirability. Not
surprisingly, perceived occupational prestige or desirability in the United
States has an overwhelming socioeconomic basis consisting largely of education
and income (Stevens
& Featherman, 1981). Typically, an
occupation’s status, or Socio-Economic Index (SEI) score, depends on the
percentage of individuals working in that occupation who have completed a
certain level of formal education or higher and the percentage with incomes at
a certain level or higher. Since an
occupation’s SEI score is a function of its educational requirements, it would
seem, on first consideration, that any association between formal education and
occupational status is largely tautological.
This probably overstates the case, however. The link between formal education and
occupational status reflects a real social phenomenon that has implications for
the cognitive complexity and desirability of the work, the social position of
those who engage in the work, and their children’s life chances (Jencks et
al., 1979; Pascarella & Terenzini, 1991).
We
uncovered only a small body of studies published in the 1990s that focused on
the impact of postsecondary educational attainment on occupational status. The results of this research are quite
consistent with the evidence from our previous synthesis, but the data sets
analyzed are somewhat dated. Two studies
(Knox, Lindsey, & Kolb, 1993[1]; Lin
& Vogt, 1996) analyzed the 1986 follow-up of the National Study of the High
School Class of 1972 (NLS-72), and one study (Kerckhoff
& Bell, 1998) used the
1986 follow-up of the 1980 High School and Beyond (HS&B) data. An additional study by Lavin and Hyllegard (1991) analyzed a
single-institution sample of 1970-72 graduates followed up in 1984. What the evidence from these studies suggests
is that: 1) a bachelor’s degree provides occupational status advantage over a
high school degree of about .95 of a standard deviation (33 percentile points);
2) an associate’s degree confers an estimated occupational status advantage
over a high school degree of between .24 and .44 of a standard deviation (9 to
17 percentile points); and 3) other amounts of postsecondary education or
sub-baccalaureate credentials such as a vocational degree or a license/certificate
provide an estimated occupational status advantage over a high school diploma
of between .12 and .22 of a standard deviation (5 to 9 percentile points). All of these occupational status advantages
over those conferred by a high school degree are statistically significant and
persist even in the presence of statistical controls in different studies for
such influences as family socioeconomic status, sex, race, high school
achievement, standardized test scores, educational aspirations, and
occupational aspirations.[2] Thus, while a bachelor’s degree appears to
confer the largest incremental advantage in occupational status compared to a
high school diploma, the evidence from the 1990s suggests that various forms of
sub-baccalaureate post-secondary education also provide modest but
statistically significant occupational status advantages.
Consistent
with the conclusions from our previous synthesis, evidence from the 1990s
clearly suggests that the bachelor’s degree not only increases the likelihood
of entering relatively high status technical and professional occupations, it
also increases the likelihood of holding a job that provides relative
occupational stability. Compared to high
school graduates, those with a bachelor’s degree are substantially more likely
to participate in the labor force and are substantially less likely to be
unemployed (Blau,
Ferber, & Winkler, 1998; Grubb, 1998, August; Office of Education Research
and Improvement, 1996; Paulsen, 1998; U.S. Department of Education, 1992; Veum
& Weiss, 1993). For example, data from the U.S. Bureau of the
Census indicated that in 1996 about 84.7% of all bachelor’s degree holders age
25-64 were employed, or participated in the workforce, while the corresponding
rate for those with a high school diploma was 74.6%. Conversely, the 1996 unemployment rate for
bachelor’s degree holders was 2.4%, less than half that for those with a high
school degree, 4.7% (Employment
and unemployment rates by educational attainment 1970 to 1996, 1997, August).
Although
they are less dramatic in magnitude, similar differences exist between high
school graduates and those with sub-baccalaureate degrees or credits in
postsecondary education (Blau et
al., 1998; Grubb, 1998, August; Veum & Weiss, 1993). Using the same 1996 Census data, the
workforce participation rates were: 82.3% for those age 25 to 64 with an
Academic Associate’s degree, 83.9% for those with a Vocational Associate’s
degree, 79.4% for those with some postsecondary education credits but no
degree, and 74.6% for those with a high school diploma. The unemployment rates were: Academic
Associate’s degree = 3.2%, Vocational Associate’s degree = 3.3%, some
postsecondary education credits but no degree = 4.0%, and high school diploma =
4.7% (Employment
and unemployment rates by educational attainment 1970 to 1996, 1997, August).
Of
course, such findings do not necessarily reflect the net impact of a
postsecondary degree completed or postsecondary credits taken. Rather, they may simply represent
employability-related differences in the intellectual or personal
characteristics of individuals with varying levels of formal education. We uncovered two studies that addressed this
issue with nationally representative data.
Lewis, Hearn, and Zilbert (1993) analyzed the 1986 follow up
of the High School and Beyond data base to determine if postsecondary
vocational training influenced participation in the labor force and number of
months employed. Net of controls for
such factors as race, gender, academic ability test scores, secondary school
grades, socioeconomic background, and high school program, neither
participation in vocational training nor completing a vocational
training program significantly influenced either measure of workforce
participation. Consistent findings are
reported by Surette (1997) in analyses of 12 years of
data (1979-1990) for men from the National Longitudinal Study of Youth. Net of controls for ability test scores,
labor market experience, and age, the completion of sub-baccalaureate vocational
training had only small and nonsignificant effects on both the probability of
being employed and annual hours worked.
However, both the number of community-college credits completed, and the
number of four-year college credits completed had a significant positive effect
on the probability of employment. The
number of four-year college credits completed and the completion of a
bachelor’s degree had significant positive effects on annual hours worked. Thus, there is a modicum of support for the
hypothesis that the relationship between amount of formal postsecondary
education and workforce participation is causal and not simply attributable to
the characteristics of individuals who acquire different amounts of
postsecondary credits or degrees.
Although
it is possible that we may have missed some studies, our literature search for
the present synthesis uncovered relatively little evidence on job satisfaction
and job performance. What evidence we
did uncover, however, is consistent with our previous synthesis in suggesting
that postsecondary education tended to produce conflicting, or at least complex
influences on satisfaction with one’s work.
It is clear that having a college degree increases the likelihood that
one will be engaged in work that not only provides higher levels of extrinsic
rewards (e.g., prestige and income), but which also offers greater intrinsic
rewards (e.g., complexity, autonomy, managerial authority, ideational content,
nonroutine tasks, and sense of control over one’s work) (Grubb,
1998, August; Hyllegard & Lavin, 1992; Kohn et al., 1990; Ross &
Reskin, 1992). Indeed, net of academic ability,
socioeconomic background, race, and gender, increasing one’s level of
postsecondary education appears to increase the importance of such intrinsic
work values (Knox et
al., 1993). Having a college education tends to have a
positive indirect effect on job satisfaction through its impact on such factors
as job prestige and earnings, job autonomy, and nonroutine work. However, net of those factors, the direct
effect of having a college degree on job satisfaction tends to be negative,
possibly because education functions to raise workers’ expectations (Ross &
Reskin, 1992). There is also evidence indicating that when
college graduates hold jobs that do not typically require a college degree,
such “over-education” can have a negative effect on job satisfaction (Jenkins,
1992). Part of this negative effect may be because
college graduates have higher expectations of the intrinsic characteristics or
returns of work than those of their actual job (Jenkins,
1992), while
another part may be attributable to the negative influence of over-education on
the extrinsic rewards of work, such as earnings (Verdugo
& Verdugo, 1989).
We
also uncovered little research on the influence of postsecondary education on
job performance. Hill (1989) surveyed nearly 190
employers in Pennsylvania to determine the effects of postsecondary education
on the performance of over 500 employees in six technical occupations: computer
programmers, EDP equipment operators, electrical/electronics engineering
technicians, mechanical engineering technicians, drafters, and surveying
technicians. In the employee sample, 32%
had a high school degree, 17% had a bachelor’s degree, and 51% had some
postsecondary education. With
statistical controls for the number of employees in the company and the type of
industry, workers with some postsecondary education or a bachelor's degree
tended to display statistically significant performance advantages—performing
better when starting work and requiring a shorter training period. They were also more likely to be
promoted. While such evidence suggests
that postsecondary education improves job performance, it should be cautioned
that the job classifications in the Hill study often do not typically require a
bachelor’s or even an associate’s degree.
Whether the same results would hold in higher level managerial or
professional positions is not clear. We
uncovered little consistent evidence in our 1991 synthesis to suggest job
productivity differences when college-educated and noncollege-educated
individuals hold the same job, although the former may have greater career
mobility. Furthermore, it is difficult
to attribute the findings of Hill’s study to the influence of postsecondary education. Since no controls were made for employee
background characteristics, the findings could just as easily be attributed to
differential recruitment. As compared to
their counterparts with high school degrees, those with exposure to
postsecondary education may simply possess more of the personal characteristics
that contribute to effective job performance to begin with.
Earnings
in the
If
one considers the premium to a bachelor’s degree simply as the average earnings
of individuals with a bachelor’s degree relative to the average earnings of
those individuals with a high school degree, expressed as a percentage, then it
is reasonably clear that the premium to a bachelor’s degree in the United
States has increased during the last part of the twentieth century (Boesel
& Fredland, 1999; Bound & Johnson, 1992; Freeman, 1994; Grogger &
Eide, 1995; Katz & Murphy, 1992; Levy & Murnane, 1992; Murphy &
Welch, 1992a; Pencavel, 1991). This increase is clearly illustrated in
Current Population Survey data from the Census Bureau for the average annual
earnings of men and women 25 and older (Is college
still worth the cost? The
private investment value of higher education 1967 to 1996, 1998, March). For the five-year period of 1967-71, male and
female bachelor’s degree holders had an average annual earnings advantage
(unadjusted for inflation) of 48.5% over their counterparts with a high school
diploma. (In other words, for this
five-year period the average annual earnings of those with a bachelor’s degree was 1.485 times as large as those with a high school
diploma.) In contrast, for the five-year
period 1992-96, men and women with a bachelor’s degree had an average annual
earnings advantage of 79.8% over men and women with a high school degree. The only aberration in this steady increase
over time in the college premium has been a downtrend in the 1970s, which paralleled
the arrival of the “baby boomer” cohorts into the U.S. labor market (Berger,
1989; Boesel & Fredland, 1999; Murphy & Welch, 1992a, 1993). Indeed, for the five-year period from 1974-79
college graduates as a group were only earning 43% more than those with a high
school diploma (Is college
still worth the cost? The private investment
value of higher education 1967 to 1996, 1998, March).[3],
[4]
Of
course it is doubtful that the total earnings premium associated with a
bachelor’s degree (versus a high school degree) is entirely attributable to
college attendance. Compared to high school
graduates, individuals who attend and graduate from college may simply possess
more of the cognitive skills and personal attributes that lead to success and
high earnings in complex managerial and technical jobs to begin with. A body of research in the 1990s has attempted
to estimate the net earnings premium of a bachelor’s degree (versus a high
school degree) by introducing various statistical controls for differences
among individuals that might confound the relationship between level of formal education
and earnings (Cancio,
Silva, Evans, & Maume, 1997; K. Gray, Huang, & Jie, 1993; Groot,
Oosterbeck, & Stern, 1995; Grubb, 1995b, 1996, 1997; 1998, August;
Hollenbeck, 1993; T. Kane & Rouse, 1993, 1995a, 1995b; Knox et al., 1993;
Leigh & Gill, 1997; Rivera-Batiz, 1998; Surette, 1997). The data sets employed in these analyses have
been: the National Longitudinal Study of the High School Class of 1972 (1986
follow-up); the National Longitudinal Study of Youth (1976 through 1983 high
school graduates followed up in 1989, 1990, and 1993); the 1992 National Survey
of Adult Literacy; the 1985 wave of the Panel Study of Income Dynamics; and the
1984, 1987, and 1990 cohorts from the cross-sectional Survey of Income and
Program Participation, which includes individuals between the ages of 25 and
64. In these analyses, statistical
controls were made for important confounding variables such as race,
socioeconomic background, secondary school grades, ability (as measured by
standardized test scores), age, job experience, job training, marital status,
and the like (depending on the data set analyzed). Taking the results from these published and
unpublished studies, we estimate that the average net annual earnings premium
for a bachelor’s degree (versus a high school diploma) is about 37% for men and
about 39% for women. The hourly wage
premium is about 28% for men and about 35% for women.[5],
[6] Such average estimates fall at the upper end
of our 1991 estimates of a net earnings premium for a bachelor’s degree of
between 20-40%. This finding perhaps
reflects the increase in the size of the earnings premium for a bachelor’s
degree in the 1980s and 1990s.[7]
One
of the major contributions of the literature of the 1990s has been its concern,
not only with the economic payoff of obtaining a bachelor’s degree from a
four-year institution, but also with estimating the net earnings premium for
different levels of sub-baccalaureate education. The focus of this concern has been primarily
on the payoff to an associate’s degree from a community college, but attention
has also been paid to the returns to vocational certificates and to
postsecondary credits or vocational training completed without a degree or
certificate. The research was largely
silent with respect to the economic returns to sub-baccalaureate education in
our previous synthesis. Not
surprisingly, much of the important evidence in this area was uncovered in the
same studies, cited above, that estimated the net premium to a bachelor’s
degree with nationally-representative samples (Groot et
al., 1995; Grubb, 1995a, 1996, 1997, 1998, August; Hollenbeck, 1993; T. Kane
& Rouse, 1993, 1995a, 1995b; Leigh & Gill, 1997; Rivera-Batiz, 1998;
Surette, 1997). Additional evidence on the net premium to
sub-baccalaureate education is provided in investigations by Grubb (1992a), Kerckhoff and Bell (1998), and Lin and Vogt (1996). Evidence yielded by the total body of studies
comes from analyses of: the 1986 follow-up of 22 to 24 year olds in the 1980
High School and Beyond sample; the 1992 National Survey of Adult Literacy; the
1986 follow-up of the National Longitudinal Study of the High School Class of 1972;
the National Longitudinal Study of Youth (1976 through 1983 high school
graduates followed up in 1989, 1990, and 1993); and the 1984, 1987, and 1990
cohorts of individuals 25-64 years of age from the cross-sectional Survey of
Income and Program Participation.
Depending on the individual study, statistical controls were introduced
for such factors as: race, socioeconomic origins, secondary school grades and
program type, ability (as measured by standardized test scores), mental status,
age, job experience, job training, and the like.
With
a few exceptions, the majority of the estimates of the net economic premium
attributable to an associate’s degree were statistically significant. Aggregating the evidence across all of the
above studies, we estimate that the average net annual earnings premium for an
associate’s degree (compared to a high school diploma) is about 17.5% for men
and about 27% for women. The hourly wage
premium is about 13% for men and 22% for women.[8],
[9] These estimates are somewhat smaller than the
typical earnings premium for an associate’s degree, unadjusted for confounding
influences. For example, Grubb (1996) provides the mean annual
earnings for individuals age 25-64 in the years 1984, 1987, and 1990 of the
Survey of Income and Program Participation; and corresponding earnings figures
for the years 1995 and 1996 are provided by the Current Population Survey (Is college
still worth the cost? The
private investment value of higher education 1967 to 1996, 1998, March). Across all five years, men with an
associate’s degree had an annual earnings advantage of 27% over men with a high
school degree, while the corresponding advantage for women with an associate’s
degree was 40%. Still, the net economic
returns to an associate’s degree from a community or two-year college represent
substantial earnings advantages over a high school diploma for both men and
women (Grubb,
1998, August; Paulsen, 1998). Furthermore, as suggested by Leigh and Gill’s
(1997) analyses of the National
Longitudinal Study of Youth data through the 1993 wave respondents, the
positive returns to an associate’s degree are essentially the same size for
experienced adult workers who return to school as they are for continuing high
school graduates.
There
is also a small body of evidence that estimates the economic returns to
postsecondary certificate programs.
Certificate programs, as described by Grubb (1998,
August), are
typically one year in length and focus on occupational rather than academic
preparation or general education. The
certificate is a common credential in vocational and proprietary schools. While the weight of evidence suggests that
they can increase earning power, particularly for women, the average net
economic returns to such certificates (compared to a high school diploma)
appear to be somewhat less certain, and probably smaller, than the average net
returns to associate’s degrees. As
reviewed by Grubb (1998,
August), analyses
of the 1986 follow-up of the National Longitudinal Study of the High School
Class of 1972 (Hollenbeck,
1993) and the
1992 National Adult Literacy Survey (Rivera-Batiz,
1998) found only
small and statistically nonsignificant effects of certificates for both men and
women. On the other hand, Grubb’s (1997) analyses of the 1984, 1987,
and 1990 cohorts of the Survey of Income and Program Participation found
statistically significant, positive earnings effects of certificates for women
across all three years. The effects for
men were positive and statistically significant in 1984 and 1987, but small and
nonsignificant in 1990. Results
generally consistent with those of Grubb (1997) are also reported by
Kerckhoff and Bell (1998) and Surette (1997). Analyzing the 1986 follow-up of the 1980 High
School and Beyond data, Kerckhoff and
Finally,
the 1990s have seen a concern with estimating the net economic premium (compared
to a high school diploma) of having different amounts of postsecondary
education without completing a degree or credential (e.g.,
Grubb, 1995a, 1997; Hollenbeck, 1993; T. Kane & Rouse, 1995b; Knox et al.,
1993; Leigh & Gill, 1997; D. Lewis et al., 1993; Rivera-Batiz, 1998;
Surette, 1997). As previously described, each of these investigations
analyzes national samples, and introduces statistical controls for salient
confounding influences. This research
has been concisely reviewed by several scholars (Boesel
& Fredland, 1999; Grubb, 1998, August; Paulsen, 1998). Their syntheses of the evidence would suggest
the following generalizations. First,
individuals can potentially increase their earnings in the labor market by
obtaining modest amounts of postsecondary education or vocational training
without obtaining a degree or certificate.
However, the average economic premium appears to be less certain and
smaller in magnitude than the average economic premium yielded by completing an
associate’s degree or a vocational certificate.
Second, the size of the premium depends substantially on what subject
matter one takes. (As we shall see in
the subsequent section of this chapter on within-college effects, this second
point also holds for a bachelor’s and an associate’s degree.) Third, a year of full-time enrollment can
lead to a net increase in earnings over a high school diploma of about 5% or
more; and the payoff of completing a year of academic credits at a community
college appears to be at least equal to, if not larger than, the payoff of
completing the same number of credits at a four-year college. Fourth, and finally, while there appears to
be a statistically significant return to taking a year’s worth of credits at a
community college, it is unclear that any real benefit is derived from taking
small numbers of community college credits (e.g., one or two courses).[10]
In our 1991 synthesis, we uncovered a small body of evidence suggesting that one receives an earnings “bonus” for completing the bachelor’s degree above and beyond the economic return for having the equivalent of four years of college (e.g., 120 credits) but not completing a bachelor’s degree. The economic literature often refers to this additional earnings increment associated with completing a degree as a “sheepskin effect” or a “credentialing effect” (e.g., Arkes, 1999; Belman & Heywood, 1991; Jaeger & Page, 1996). Others (e.g., Grubb, 1997, 1998, August) use the term “program effect” to indicate that a degree represents a coherent sequence of courses in a field of study or discipline, as well as a program of general education. Regardless of the descriptive term employed, the research of the 1990s not only presents substantially more evidence concerning the credential or program effect attributable to obtaining a bachelor’s degree, it also estimates the corresponding credential/program effect linked to sub-baccalaureate degrees and certificates.
Estimating the credential/program effect of different postsecondary degrees and certificates has been largely the concern of economists (Arkes, 1999; Belman & Heywood, 1991; Frazis, 1993; Grubb, 1996, 1997, 1998, August; Heywood, 1994; Jaeger & Page, 1996; T. Kane & Rouse, 1995a; Surette, 1997). This body of studies analyzed data from a range of nationally-representative samples. These include: the 1979 and 1986 follow-ups of the National Longitudinal Study of the High School Class of 1972; the 1989, 1990, and1993 follow ups of the National Longitudinal Study of Youth; the 1984, 1987, and 1990 cohorts of the National Survey of Income and Program Participation; and various iterations of the Current Population Survey. The typical analytical approach was to regress either hourly wages or annual earnings on a prediction model that specified highest degree or certificate obtained, number of years of postsecondary education completed if no degree was obtained, and, depending upon the specific study, statistical controls for important confounding influences (e.g., tested ability, labor market experience, socioeconomic background, and the like).
Consistent
with the conclusion from our 1991 synthesis, the weight of evidence from this
research suggests that the individual who completes a bachelor’s degree obtains
a statistically significant earnings advantage over a similar individual with
the equivalent of four years of college credits, but no degree. The magnitude of this earnings advantage is
more difficult to determine. However,
across all studies our best estimate is that men with a bachelor’s degree earn,
on average, about 15% more than men with four years of college credits but no
degree. For women, the corresponding
earnings advantage is about 12%.
Although the estimates are quite variable and not as consistent as those
for the bachelor’s degree, the weight of evidence would also suggest the
presence of statistically significant credential/program effects for the
associate’s degree. Combining the
results from all studies using national samples that provide relevant evidence (Arkes,
1999; Grubb, 1997; Jaeger & Page, 1996; T. Kane & Rouse, 1995a;
Surette, 1997), we
estimate that men who finish an associate’s degree earn, on average, about 9%
more than men with the equivalent of two years of postsecondary education, but
no degree. For women, the corresponding
earnings advantage for completing an associate’s degree is about 11%.[11] We would caution, however, that these
estimates, as well as those for a bachelor’s degree, are somewhat rough and may
not be particularly robust.
Finally,
although it is not unequivocal, there is also a modicum of evidence from
nationally-representative samples to suggest a credential/program effect for
completion of vocational training. For
example, Grubb’s (1997) analyses of the 1984, 1987,
and 1990 cohorts of the National Survey of Income and Program Participation
found that, across all three years, women who obtained a vocational certificate
had an average earnings advantage of about 10% over women with one year of
postsecondary credits but no credential.
For men, the corresponding advantage was about 10% in 1984, but
decreased to near parity or a slight disadvantage in 1987 and 1990. On the other hand, Surette’s (1997) analyses of the National
Longitudinal Study of Youth through 1993 found that men who completed
vocational training had a statistically significant 5% advantage in hourly
wages over men with the required postsecondary credits but no degree. Our conclusion then is that the
credential/program effect of completing vocational training, while likely real,
is somewhat less certain and smaller in magnitude than the credential/program
effect for either the associate’s degree or the bachelor’s degree.
Evidence
establishing the net earnings premium of postsecondary degrees provides a
perspective on only one part of the economic returns picture. Premium research focuses primarily on
benefits, without considering the attendant costs. Yet, postsecondary education often requires a
financial investment on the part of the student in the form of tuition, books,
and other educational fees. Moreover,
for a substantial number of students, the time they invest in postsecondary
education is a time during which they forego income or, if they work part-time
during college, at least part of the income that they would have earned had
they entered the labor force immediately after high school. Such foregone earnings are sometimes referred
to as the opportunity costs of attending college. Attempts to take the full range of costs into
account when estimating the economic returns to postsecondary education has
spawned a line of inquiry we will refer to as private (or internal) rate of
return research.
Basically,
private rate of return is an attempt to estimate one’s percentage return on
investment. Not surprisingly, the actual
computation can get pretty complicated and esoteric due to a number of
assumptions that must be considered, such as inflation on foregone earnings (e.g.,
Alsalam & Conley, 1995; Becker, 1992; Cooper & Cohn, 1997; Geske, 1996;
Leslie, 1990; McMahon, 1991). However, a simple way to visualize at least
the fundamental concept of private rate of return to a bachelor’s degree is to
divide the difference between average posttax earnings of bachelor’s degree
holders and high school graduates by the sum of the private unsubsidized costs
of education, plus foregone earnings.
For illustrative purposes, consider the following example using
fictitious numbers for simplicity.
Suppose that the average annual posttax earnings of all male bachelor’s
degree holders in the county in 1989 was $30,000 and the corresponding average
posttax earnings of male high school graduates was $22,000. Therefore, a male with a bachelor’s degree
could expect to earn on average during his working life $8,000 more per year
($30,000 - $22,000) than he would be earning with only a high school
degree. Let’s also suppose that the
average total unsubsidized costs of a college education (combining private and
public institutions) in 1989, plus average foregone earnings if one didn’t work
during college were $60,000. If
postsecondary education were considered an investment, such an arrangement
would be the equivalent of purchasing a promise to receive an average of $8,000
annually during one’s working life at a present cost of $60,000. If we divide $8,000 by $60,000, we see that
the average annual yield of investing in a bachelor’s degree is 13.3%. This 13.3% would be considered the private
rate of return to a college degree.[12]
In
our previous synthesis, we concluded that the average private rate of return to
a bachelor’s degree, based on studies covering the time period from 1940 to
1982, was somewhere between 11.8 and 13.8%.
When this was adjusted for differences in intellectual ability between
high school and college graduates, the private rate of return for a bachelor’s
degree fell to between 9.3 and 10.9%.
The evidence we uncovered in our present synthesis suggests that this
private rate of return to a bachelor’s degree has remained stable or, parallel
to the earnings premium for a bachelor’s degree, perhaps even increased in the
late 1980s and early 1990s (Arias
& McMahon, 2001; Cohn & Hughes, 1994). As with our literature review for How
College Affects Students, we have had the benefit of a number of excellent
reviews of the private rate of return findings in shaping our present synthesis
(e.g.,
Alsalam & Conley, 1995; Becker, 1992; Boesel & Fredland, 1999; Cohn
& Hughes, 1994; Geske, 1996; Leslie, 1990; McMahon, 1991; Paulsen, 1998). Although they differ in the literature they
review, all of these syntheses provide a rather consistent estimate of the
average private rate of return to a bachelor’s degree at around 12%, with a
typical range from about 9-16%.
From
one perspective, these estimates may be biased upward because they typically
are not corrected for ability or intelligence.
However, an interesting paper by Arias and McMahon (2001) uses recent studies of
identical twins to estimate the average bias to ability and measurement error
at about 12%. Applying their adjustment,
our estimate of the average private rate of return to a bachelor’s degree,
controlling for ability, would be about 10.6%.[13]
From
another perspective, however, the unadjusted estimates of the private rate of
return to a bachelor’s degree may underestimate the true private rate of return
because they do not take into account other monetary returns such as health
care, retirement, stock options, and support for continuing professional
development. These and related fringe
benefits tend to be more substantial in the kinds of jobs held by college
graduates (Boesel
& Fredland, 1999; Geske, 1996). There is also the issue of foregone
earnings. Since so many students work
while attending college, the assumption of many private rate of return
estimates that students will forego all earnings while obtaining their bachelor’s
degree seems untenable (Cohn &
Rhine, 1989). Indeed in analysis of the 1985 wave of the
Panel Study of Income Dynamics, Cooper and Cohn (1997) found that when they took
into account, along with other factors, the average earnings of a student while
attending college, the private rate of return to a bachelor’s degree ranged
from 12.1 to 19.3%.
Even
if one assumes that the private rate of return is what we estimate the average
to be, 12%, such a rate of return compares quite favorably with other
investments (Boesel
& Fredland, 1999; Cooper & Cohn, 1997). As Boesel and Fredland point out, returns on
the stock market have typically averaged around 11%, but, unlike private rate
of return, the stock market rates are nominal returns that disregard inflation. Moreover, if one considers the option value
of a bachelor’s degree (e.g., the option of entering graduate or professional
school), as well as the nonmonetary returns (e.g., health benefits, working
conditions, lifelong learning, enhanced life chances for children (see
Leslie, 1990; Mathios, 1989; McMahon, 1998), a college degree continues
to be a reasonably informed and prudent investment.[14], [15]
Although
the evidence is quite clear that bachelor’s and associate’s degrees provide
substantial occupational prestige and earnings premia to individuals who obtain
them, it is not always as clear just why this is the case. Determining the causal mechanism(s)
underlying the positive link between postsecondary education and both
occupational prestige and earnings has become one of the favorite indoor sports
of both economists and sociologists. In
our 1991 synthesis, we concluded that no single causal mechanism provided a
completely satisfactory explanation and that a number of processes may be at
work. We uncovered little evidence in
the decade of the 1990s to suggest a fundamentally different conclusion.
As
suggested by Bills (2000), there are at least seven
distinct theories or explanations that economists and sociologists have offered
for why those with the most schooling get the most desirable and best
jobs. Since a detailed discussion of
these theories is beyond the scope of this book, we confine our synthesis to
the evidence regarding three of the major theories: human capital,
signaling/screening, and credentialing.
Human capital theory suggests that college graduates have more desirable
jobs and earn more than high school graduates because postsecondary education
provides the former with marketable skills and abilities relevant to job
performance. Signaling/screening are two
complementary mechanisms in that job seekers signal and employers screen (Bills,
2000). Postsecondary education may not so much
influence the cognitive and personal traits related to job productivity as
simply select for individuals who have such traits to begin with. Thus, a college degree can be used by job
seekers to signal desirable intellectual and personal traits, irrespective of
whether those traits are acquired as the result of postsecondary education. Employers can use a college degree as a relatively inexpensive screening device to select individuals who
they believe possess intellectual skills and personal traits predictive
of productivity for the best jobs.
Finally, credentialism posits that employers may not select or reward
individuals solely on the rational basis of potential or actual
productivity. Rather, the factors that
influence these decisions are shaped by such things as social class, snobbery
or, as suggested by Bills (2000, p.
20) “widely
shared societal assumptions about the appropriate relationship between
schooling and job assignment.” This
would mean that those with postsecondary degrees could end up being overly
positioned or rewarded in the labor market for reasons unrelated to individual
productivity (Jencks et al.,
1979).
While
we found evidence to support each of these explanations, none seems sufficient
to unambiguously account for the relationship between educational attainment
and labor market rewards. For example,
the most straightforward explanation is probably human capital; and the
underlying premise that postsecondary education provides skills that make
individuals better employees has considerable logical appeal. It seems almost axiomatic that a bachelor’s
degree in such fields as engineering, accounting, nursing, and speech
pathology, to name a few, indicates the completion of a course of study that
actually provides knowledge and skills important to effective job
performance. Not inconsistent with this
view are Grubb’s (1996;
1997) findings
for both men and women that the economic returns to bachelor’s and associate’s
degrees tend to be more pronounced when one’s academic major is closely related
to one’s job than when it is unrelated.
Similar results are reported for two national samples of bachelor’s
degree recipients by Tsapogas, Cahalan, and Stowe (1994) and for graduates of single
institutions by Callaway, Fuller, and Schoenberger (1996), Dutt (1997), and Fuller and
Schoenberger (1991). Presumably, if the skills one acquires in his
or her program of study are applicable to the job requirements, the economic
returns increase, a result generally compatible with
human capital theory. However, as Grubb
points out, this may also be explained by the fact that those academic majors
that are linked to the highest economic returns are also the ones most likely
to lead to related employment (e.g., engineering,
business, health).
Whether
evidence suggesting a strong relationship between educational attainment and
labor market success is simply the result of increasing one’s human capital is
nearly impossible to verify in the evidence we reviewed. For example, in their analyses of the 1986
follow up of the National Longitudinal Study of the High School Class of 1972,
Knox, Lindsay, and Kolb (1993) found an almost monotonic
positive relationship between amount of formal postsecondary education
completed and both occupational status and earnings, even after controls were
introduced for ability test scores, race, gender, and socioeconomic
status. Similar findings are reported
for earnings by Arkes (1999) in analyses of the 1993
wave of the National Longitudinal Study of Youth. One could reasonably view such findings
through the lense of a human capital perspective and conclude that, net of
ability, the greater one’s acquisition of high level knowledge and skills, as
indicated by amount of exposure to postsecondary education, the greater one’s
returns in the labor market. On the
other hand, such evidence may merely suggest that years of postsecondary education
or degrees signal important personal skills or attributes that employers value because they predict job productivity. For example, Arkes (1999) concluded that a bachelor’s
degree signals intellectual ability to employers. However, it was also the case that bachelor’s
and associate’s degrees provided an earnings premium above and beyond
intellectual ability and the equivalent numbers of credit hours required. This suggests that these degrees may signal
personal attributes to employers that they value as predictors of job
productivity, other than ability (e.g., ambition, motivation, persistence).
Other
evidence reported by Grubb (1993) is purported to support the
screening/signaling hypothesis, at least in part. Grubb reasoned that if degrees signaled
ability or other desirable traits to employers, then they would leave a
stronger impact on earnings in salaried occupations, which are presumably
screened, than on the earnings of those who were self-employed. Using the 1986 follow-up of the National
Longitudinal Study of the High School Class of 1972, and controlling for such
factors as ability, job experience, socioeconomic status, and high school
grades, Grubb found mixed support for his hypothesis. Vocational associate’s degrees counted more
in salaried (screened) than in self-employed (unscreened) positions, while
generally the reverse was true for the bachelor’s degree. Grubb concluded that the labor market for
sub-baccalaureate credentials works differently than it does for bachelor’s
degrees. Such a
finding further underscores the difficulty one has in uncovering a single, or
perhaps even a predominant, explanation for the education-earnings
relationship.
Evidence
supporting a credentialing explanation for the fact that the more highly
educated have the most desirable and best paying jobs rests largely on the
evidence we reviewed in the previous section of this chapter on credential or
program effects. As we saw in that
section, the weight of evidence was reasonably clear that individuals receive
an earnings bonus for completing a bachelor’s or associate’s degree above and
beyond the economic return of having the equivalent years of college (four or
two, respectively), but not completing the degree. It is highly questionable that the final year
of postsecondary education leading to either the bachelor’s or the associate’s
degree actually enhances individual productivity at a higher rate than the
preceding years. Thus, through a
credentialing lense, degrees may function as socially-sanctioned gatekeepers by
which those who have them gain easier access to higher-paying jobs and career
paths than those who do not, for reasons not necessarily related to productivity. Put another way, postsecondary degrees are
less about conferring labor market skills, or signaling ability, than they are
about conferring status that can be used in American society to gain entry into
the most prestigious and rewarding occupations.
Of
course, the earnings bonus or boost associated with completion of postsecondary
degrees does not necessarily lead to credentialing explanation. Completing a degree might signal personal
traits such as perseverance or focus that are important to employers because
they predict job productivity. Moreover,
a degree may represent completion of a coherent, integrated program of study
that is more predictive of job relevant skills than simply completing an
equivalent number of postsecondary credit hours.
What
seems evident is that the causal mechanisms underlying
the relationship between educational attainment and both occupational
positioning and earnings are complex.
They may function differently, and with varying degrees of importance,
in different career paths, at different times in one’s career, in different
jobs or labor market sectors, and with changes in the economy and the nature of
work. It may be fruitless to search for
a single, dominant explanation.
Furthermore, the increased importance of computers and information
technology, and how they influence fundamental notions of work and career may
be an additional wild card that shapes broad-based societal perceptions of
competence and competitiveness in the labor market (Bassi,
1999).
In
this section, we have attempted to summarize the evidence on the net effects of
college on career and economic returns.
Our estimates are based on the average returns that accrue to an
individual, irrespective of the type of postsecondary institution attended or
one’s academic and nonacademic experiences once there (e.g., major field of
study, grades, extracurricular involvement, and the like). Consequently, they potentially mask
variations in between- and within-college effects. We turn to these in the next two sections of
the chapter, starting with between-college effects.
Between-College Effects
Conclusions from
The
most investigated of all institutional characteristics is that of institutional
“quality,” typically assessed in terms of student body selectivity (e.g.,
average ACT or SAT score of entering students) or reputational and prestige
indexes. Compared with other
institutions, elite or selective institutions tend to enroll students with high
occupational status aspirations to begin with, and their impact appears to be
one of maintaining or perhaps slightly accentuating the status level or academic
career orientation of initial choice.
This net impact on career choice is quite small compared to that
attributable to career choice at the beginning of college. It may be particularly true of students
attending selective or prestigious institutions that the undergraduate
experience is used more to implement than to choose a career.
Attendance
at a selective college modestly increases the likelihood that women will choose
sex-atypical (male-dominated) majors and careers and that they will enter
sex-atypical occupations. It also
appears that a degree from an elite institution confers a slight advantage in
various dimensions of career mobility and success (e.g., technical or
supervisor responsibility, level of managerial attainment). However, with the possible exception that
college selectivity may have more positive implications for attainment in the
professions than in managerial or business occupations, the weight of evidence
indicates that attending a selective or prestigious institution has little net
impact on overall job status, job productivity, or job satisfaction.
Net
of other factors, college quality (and particularly selectivity) has a small
positive direct effect on earnings. The
best estimate of the magnitude of this effect is that quality indexes account
for between 1 and 1 1/2 percent of the variance in individual earnings above
and beyond other factors. There is some
evidence that this effect is nonlinear; only those colleges at the very top of
the distribution of selectivity or academic reputation may significantly
enhance earnings. Estimates of direct
effects may underestimate the total positive impact of institutional quality
measures on earnings. Institutional
quality may also have a positive effect on earnings by enhancing educational
attainment and attendance at prestigious professional schools. We conclude that the evidence is more
supportive of a screening (as opposed to a human capital) explanation for the
apparent impact of college quality on earnings.
Comparison
of two-year and four-year institutions has produced the most pronounced and
consistent between-college effects on occupational status. Net of other factors, students who begin the
postsecondary education experience in two-year colleges have significantly
lower job status than those who start at four-year institutions. Most of this difference, however, appears to
be attributable to the adverse impact of two-year institutions on educational
attainment. For individuals of equal
educational attainment, whether they start at two-year or four-year
institutions makes little difference in early occupational status, employment
stability or job satisfaction.
Similarly, when individuals of equal background traits and educational
attainment are compared, any direct earnings penalties for attending a two-year
college are quite small early in the career, though they may increase slightly
with longer work experience. It is
likely, however, that initial attendance at a two-year college may have a
discernible negative indirect effect on earnings due in large measure to its
inhibiting influence on educational attainment.
There
is evidence that men’s colleges have independently enhanced male career choice
and attainment in such areas as business, law, and the professions in general. Substantially more research, however, has
focused on the impact of women’s (versus coeducational) institutions. The weight of evidence suggests that
attending a predominantly women’s institution rather than a coeducational one
has little or no independent impact on a woman’s career salience (interest in
or commitment to a career), the status or prestige level of the job she
obtains, her earnings, or the likelihood of her actually entering a
sex-atypical career (globally defined according to the percentage of men in the
field). On the other hand, women’s
institutions appear to enhance orientation toward a sex-atypical occupation
during college, entrance in certain specific
sex-atypical occupations (such as medicine and scientific research), and
prominence or achievement within a specific occupational status level.
Net
of other factors, attending a predominantly black institution rather than a
predominantly white institution appears to have only a trivial impact on the
occupational status of black men or black students generally. However, some evidence suggests that
attendance at a black college may enhance the early job status of black
women. There was little consistent
evidence to suggest that college racial composition had a statistically
significant net impact on the earnings of black men or women.
Attending
a large institution appears to have a small positive influence on occupational
status and earnings that is independent of student background characteristics
and the selectivity of the student body.
There is parallel evidence to suggest that major research universities,
most of which are large, also positively influence earnings; but it is
difficult to separate this effect from institutional quality.
Institutional
control appears to have little consistent impact on career choice, occupational
status, or women’s entry into sex-atypical careers. However, public control appears to enhance
the likelihood of successfully implementing career plans for becoming an engineer
or college teacher while reducing the likelihood of successfully implementing
plans for law, business, medicine or nursing.
The major influence of liberal arts colleges may be in their enhancing
of women’s choice of sex-atypical majors and careers, although the evidence
supporting this conclusion is not particularly strong. Net of other factors, attending a liberal
arts college would appear to have little or no impact on occupational status.
The
most consistent college environmental impact on career choice appears to be
that of “progressive conformity.”
Progressive conformity hypothesizes that student career choice will be
influenced in the direction of the dominant peer groups in an institution. A small amount of evidence indicates that
irrespective of initial career choice, seniors tend to be planning careers
consistent with the most typical academic majors in their institution. There is also evidence, though less of it, to
suggest that independent of initial career choice, a student’s likelihood of
actually working in a particular occupation increases with the percentage of
majors at his or her college corresponding to that occupation.
There
is modest support for the expectation that transfer between four-year
institutions has negative consequences for both early career occupational
status and earnings. Most of this
negative effect is indirect through the inhibiting influence of transfer on
educational attainment.
Considering
only four-year institutions, the weight of evidence suggests that any
statistically significant between-college effects are quite modest in
magnitude. This is particularly the case
when compared to the general net effects of attending rather than not attending
college.
Evidence from the 1990s
We uncovered a substantial body of studies conducted during the decade of the 1990s that focused on between-college impacts on career and economic returns. Much of this research is uneven in terms of methodological rigor; and perhaps in part because of these methodological problems it is difficult to find evidence consistent enough to permit unequivocal conclusions. Even in those areas where the evidence is relatively strong (e.g., the impact of college selectivity on earnings), there are alternative findings or explanations which tend to muddy the waters. The same fundamental methodological problem that accompanies any estimate of between-college effects is particularly relevant in determining the between-college effects on career. Specifically, there is great variability in the cognitive abilities, socioeconomic backgrounds, career aspirations, and ambitions of students attending different kinds of postsecondary institutions (e.g., Behrman, Kletzer, McPherson, & Schapiro, 1995; Behrman, Rosenzweig, & Taubman, 1994; L. Lewis & Kingston, 1989; Lillard & Gerner, 1999; Sazama, 1994). Furthermore, such individual student characteristics are likely to play a major role in different dimensions of career choice and success. For example, a number of economists have noted that the economic returns to cognitive skills (i.e., the correlation between scores on standardized cognitive tests and earnings) has increased over the past several decades (e.g., Hoxby & Long, 1999; Murnane, Willett, Duhaldeborde, & Tyler, 1998; Murnane, Willett, & Levy, 1995; Neal & Johnson, 1994). Similarly, one of the strongest predictors of eventual occupational attainment (e.g., occupational status) is occupational aspirations or ambition when entering college (e.g., Inoue & Ethington, 1997; Kingston & Smart, 1990; Stoecker & Pascarella, 1991; Whitaker & Pascarella, 1994). Consequently, the relationship between the type of college attended (e.g., selective versus nonselective) and any particular career outcome (e.g., earnings) is likely to be substantially confounded by differences in the career-salient characteristics of the students who attend different kinds of colleges.
Estimating
between-college effects on career and economic returns is also complicated by
other factors. For example,
postsecondary institutions not only differ dramatically in the kinds of
students they recruit and enroll, they may also differ dramatically in what it
costs the individual to attend them (Choy,
1999). For example, Morganthau and Nayar (1996) point out that the average
cost of attending an elite private college (e.g., an Ivy League, or similar,
school) is about $1,000/week, while the average cost of attending a public
university is about one-fourth of that, or about $250/week. Moreover, it is clearly the case that many
measures of institutional “quality” (e.g., selectivity, academic reputation,
prestige) are confounded by whether or not the institution is private. Even though the “real” costs of attending college
may be less because of widespread financial aid in the form of student aid,
grants, fellowships, tuition waivers, and the like, these differences in costs
are still substantial, and undoubtedly need to be taken into account when
estimating the earnings’ returns accruing to the graduates of different kinds
of colleges.
A
second factor is major field of study.
As we will see in the section on within-college effects in this chapter,
a student’s major field of study is, unsurprisingly, a major determinant of
one’s eventual occupation and earnings.
However, it is evident that different types of colleges offer their
students different kinds of academic majors.
For example, as pointed out by Jacobs (1999), more
selective/prestigious, private institutions tend to focus on academic fields of
study that lead to more lucrative jobs (e.g., engineering, business,
science). Conversely, because of their
state-oriented mission, less selective, public institutions may be expected, if
not required, to offer academic majors that lead to less lucrative occupational
paths (e.g., education, social work, home economics). Thus, if academic field of study is not taken
into account, it may be easy to attribute the earnings or occupational status
differences of graduates to an institutional effect when it is really the
result of one’s major field of study.
Finally,
the estimation of between-college effects on career and economic returns is
also complicated by the fact that a substantial number of students in the
American postsecondary system attend more than one college or university before
earning their bachelor’s degree (Adelman,
1998a). However, as opposed to such outcomes as
learning, cognitive development, and values and attitudes, between-college
impacts on career and economic returns do not necessarily assume a human
capital or socialization influence (i.e., that some colleges provide a higher
quality education than others). Rather,
the impact of where one attends college may, in fact, simply reflect the extent
to which completing a bachelor’s degree from that particular institution
signals personal traits that employers value as predictive of job performance
or productivity, irrespective of where they were acquired (e.g., high
intelligence, ambition, social skills, and the like).
The
above considerations clearly make the estimation of between-college effects on
career and economic returns complex and fraught with ambiguities. Nevertheless, we have attempted to synthesize
this body of evidence within the following general categories: institutional
quality, institutional control, Carnegie classification, institutional size,
institutional racial composition, institutional gender composition, two-year
versus four-year colleges, and impact of peers.
Research
estimating the net impacts of institutional quality constituted at least 50% of
the total body evidence we uncovered pertaining to between-college effects on
career and economic returns. Not
surprisingly, different studies operationally defined institutional quality in
different ways. Included were such
dimensions as: academic expenditures/student, faculty/student ratio, percentage of faculty with Ph.D.s, tuition costs,
reputational ratings, average faculty salaries, and selectivity (typically
based on the average ACT or SAT scores of entering freshmen). An obvious problem, of course, is that all
these various dimensions of institutional quality tend to be substantially and
positively intercorrelated. For example,
the most academically selective institutions tend also to have the highest
reputational ratings, the highest faculty salaries, the highest expenditures/student,
and, because they also tend to be private, the highest tuition costs. As a result, and because of the vagaries of
multiple regression procedures when the predictors are highly correlated,
determining which quality dimensions are having the strongest impact is
frequently problematic. Some researchers
have dealt with this problem by creating a composite measure of institutional
quality that combines several of the dimensions indicated above. Most, however, have employed institutional
selectivity (e.g., the average ACT or SAT score of
incoming students) as a single proxy measure for institutional quality. The research on the impact of institutional
quality has focused on career choice, occupational status, career mobility and
success, and earnings.
Career Choice
What
little evidence we uncovered suggests that institutional quality measures have
only a mixed impact on students’ career choices during college. For example, Cole, Barber, Bolyard, and
Linders (1999) focused on the career
choices of high achieving arts and sciences majors (grade point averages of 2.8
or above) at 34 institutions: 8 Ivy League schools, 13 liberal arts colleges, 9
large state universities, and 4 historically black colleges. Statistical controls were introduced for an
extensive set of potential confounding influences such as: race, specific
freshman career interest, academic ability, college grades, interaction with
faculty, influence of work experience, and the like. In the presence of such controls, attending
an Ivy League institution (versus all others) had no significant impact on
choosing law, medicine, or college teaching as a career. Attending an Ivy League school did modestly,
but significantly increase the likelihood that one would choose business as a
career. However, this increase was
essentially attributable to differences in senior-year business career choice between
students at Ivy League schools and seniors at large public universities. In all four career choices
(law, medicine, business, and college teaching), initial interest in a career
as a freshman was, by far, the strongest predictor of senior career choice.
Tusin
(1991) analyzed the 1971-80
Cooperative Institutional Research Program data to determine why women choose
elementary and secondary school teaching as a career. Net of a battery of potential confounding
influences, including freshman-year career choice, institutional selectivity
had a modest, but statistically significant negative influence on choosing
elementary or secondary school teaching as a career. Such a finding may reflect the influence of
faculty and peer cultures at selective institutions in shaping a student’s
career aspirations and choice. The
normative press of the culture at selective, elite institutions may function to
steer student aspirations toward career choices that are perceived as more
lucrative and “prestigious” than teaching in elementary or secondary schools. At the same time, the effect could just as
easily be attributable to the fact that more selective colleges and
universities, particularly if they are private, are substantially less likely
to offer education and teacher preparation as a major field of study.
Occupational
Status
Consistent
with conclusions from our 1991 synthesis, we found little evidence to suggest
that measures of institutional quality have more than a trivial and
statistically nonsignificant direct impact on overall occupational status. Analyzing the 1986 follow-up of the National
Longitudinal Study of the High School Class of 1972, Knox, Lindsay, and Kolb (1993) introduced statistical
controls for such factors as tested academic ability, race, gender,
socioeconomic background, college grades, major field of study, educational
attainment, and the like. In the
presence of these controls, the selectivity of the institution attended had a
small and nonsignificant effect on the occupational status of the job one held
in 1986. Remarkably consistent results
are reported by Avalos (1996), analyzing the 1994
follow-up of the Cooperative Institutional Research Program’s 1985 Freshman
Survey, and by Dey, Wimsatt, Rhee, and Waterson (1998), analyzing the 1974-75 and
1992-93 follow-up of 1,957 high school seniors from the Wisconsin Longitudinal
Study. Both studies employed an
analytical design similar to that of Knox et al. and introduced statistical
controls for salient confounding influences.
In the Avalos study, institutional selectivity failed to have a
significant direct impact on 1994 occupational status; and in the Dey et al.
study, neither institutional prestige (e.g., composite of selectivity, percent
of students seeking a Ph.D., median high school grades of entering students,
and ratio of high ability applicants to total number of admitted students) nor
institutional resources (e.g., average faculty salary, faculty with Ph.D.s,
number of library volumes) significantly influenced 1974-75 occupational status
or 1992-93 occupational status.[16]
All
three of the studies cited above (i.e.,
Avalos, 1996; Dey et al., 1998; Knox et al., 1993) focus on estimating the net
direct influence of measures of institutional quality on overall
occupational status. While the clear
weight of evidence suggests that this direct influence is trivial and not
statistically significant, it is likely that institutional quality may,
nonetheless, have at least a modest positive, indirect effect on occupational
status. This indirect influence is
attributable to the fact that (as we saw in Chapter ) dimensions of institutional quality such
as student body selectivity positively influence educational attainment, which,
in turn, is a strong determinant of the prestige of the job one holds. Unfortunately, the analytical models in the
investigations by Avalos (1996), Dey et al. (1998), and Knox et al. (1993) do not permit us to
estimate the magnitude or statistical significance of this indirect effect.
The
failure of college quality measures to directly influence overall job status is
consistent with our 1991 conclusions.
However, also consistent with our 1991 conclusions is evidence to
suggest that attending a selective college enhances occupational attainment in
specific professions such as medicine and law.
For example, Lentz and Laband (1989) found that even with
controls for college grades, college courses taken, Medical College Admissions
Test scores, race, and parental occupation and education, the academic
selectivity of the college one attended had a statistically significant,
positive influence on admission to medical school. Similarly, Kingston and Smart’s (1990) analyses of the 1980
follow-up of the 1971 Cooperative Institutional Research Program freshman
survey found that attending one of the 74 most selective private colleges in
the United States significantly increased one’s likelihood of completing a high
status professional degree (i.e., MD, JD, MBA).
This effect persisted even in the presence of statistical controls for
such factors as race, sex, family background, high school achievement, precollege
occupational aspirations, and self-estimates of academic ability and drive to
achieve. Interestingly, in both studies
this effect was nonlinear, and generally accrued only to those students
attending the most selective or elite institutions in the country. For
Consistent
with the conclusions of our 1991 synthesis, we found a small body of evidence
to suggest that attending a selective college confers a modest advantage in job
attainment and career mobility. The
evidence, however, is somewhat complex and suggests that college quality may
signal an individual’s ability to employers, rather than conferring unique
skills that make for better job performance.
Data from graduates of accounting programs in 82 universities was
analyzed by Colarelli, Dean, and Konstans (1991) to determine if
institutional characteristics influenced job offers and early job
productivity. Measures of institutional
quality such as student body selectivity and institutional resources were both
significantly and positively related to the number of job offers an individual
received from the eight largest and most prestigious accounting/consulting
firms in the region. However, after one
year on the job supervisors’ ratings of job performance and promotability were
unrelated to institutional resources and actually had a significant negative
association with institutional selectivity.
A
more focused set of longitudinal studies by Spilerman and colleagues (Ishida,
Spilerman, & Su, 1997; Spilerman & Lunde, 1991) investigated the educational
factors that influenced job promotion prospects in a single large insurance
company. Spilerman and Lunde (1991) introduced statistical
controls for years of education, race, gender, age, seniority, and salary grade
level and found that a measure of college selectivity had modest, but
statistically significant positive effects on promotion in the middle
organizational ranks where college training would provide relevant job
skills. The selectivity of the
institution one attended had only a chance impact on the likelihood of being
promoted at either the lowest or highest organizational ranks in the
company. Generally consistent results
were also reported by Ishida, Spilerman, and Su (1997) in what appears to be a
further study of promotion in the same company.
With controls for level of formal education, college major, age, race,
sex, and seniority, institutional selectivity once again had a modest, but
statistically significant positive impact on promotion to the middle
organizational ranks of the company (i.e., senior management), but essentially
only a chance effect on promotion at either lower or higher ranks (i.e.,
administrative or vice-presidential grades).
Although
it is more prominent in the Spilerman and Lunde (1991) study than in the Ishida,
Spilerman, and Su (1997) study, both investigations
provide evidence to suggest that at the lower and middle ranks of the firm they
studied, the impact of college selectivity on promotion varied with experience
or seniority in the firm. The positive
effect of college selectivity was greatest for employees who were recent or
initial hires in the firm and at the early stages in their careers. As seniority in the firm increased, and
direct measures of job performance became available, the selectivity of the
college one attended decreased in importance.
Spilerman and his colleagues conclude from such evidence that given lack
of direct information on job performance of new hires at the beginning of their
careers, the firm’s employers use college selectivity as a proxy or “signal”
for the possession of intellectual and related skills that are important for
job performance. However, if college
selectivity signals higher intellectual or other skills related to effective
job performance, it is not clear from either the Spilerman and Lunde or Ishida,
Spilerman, and Su studies if the individual acquires them from his or her
experience in college or essentially entered college with them.[17]
Finally,
there is also evidence of an indirect nature that speaks to the effect of
college quality on career mobility.
Robst (1995) analyzed data from 560 male
heads of household between 18 and 64 years of age in the 1976, 1978, and 1985
waves of the Panel Study of Income Dynamics.
His purpose was to estimate the net impact of college selectivity on the
probability that an individual was employed in a job for which he was
overeducated (i.e., held a job in which his education was substantially higher
than that typically required). With
controls for years of education, work experience, number of years in one’s
current job, and scores on a 13-question sentence completion test, three
institutional quality measures (i.e., average ACT/SAT scores of the entering
freshmen, educational and general expenditures per student, and a prestige
rating) had modest, but statistically significant negative effects on the
probability of being overeducated.
Moreover, college selectivity was also positively associated with the
likelihood of moving from being overeducated for one’s job in 1976 to being in
a job in 1985 for which one was not overeducated. The findings of the Robst study, however, are
likely confounded by the inability to control for men’s precollege levels of
career or occupational aspirations—strong predictors of both a man’s eventual
occupational level and the type of college he attends (Pascarella
& Terenzini, 1991). Robst also
candidly points out that it is questionable that a 13-item sentence completion
test is an adequate measure of individual cognitive ability. In short, the presumed negative effects of
college quality on overeducation may in fact be attributable more to the
characteristics of the men who attend high quality colleges.[18]
Earnings
Perhaps
the largest single body of research on between-college effects on career and
economic benefits concerns the impact of undergraduate institutional quality
measures on individual earnings. Once
again, institutional quality is operationally defined in different ways in
different investigations, but student body selectivity appears to be the most
common proxy for college quality. The
typical study in this body of research analyzes data from a
nationally-representative sample, uses the natural logarithm of earnings as the
dependent variable in order to adjust for positive skewness in the distribution
of earnings, and introduces statistical controls for factors that potentially
confound the relationship between the quality of the institution attended and
an individual’s earnings. These
confounding factors include such variables as ability test scores, family socioeconomic
background, race, sex, major field of study, educational attainment, and the
like. On average, the studies we
reviewed explained considerably less than half of the variance (R2)
in individual earnings, typically in the neighborhood of 25-35%. Unless one is willing to accept the view that
two-thirds or more of the earnings differences among college graduates are
attributable to luck, it seems reasonable to conclude that a number of
important influences on earnings are not taken into account in the literature
we reviewed.
This
large percentage of unexplained variance does not necessarily mean that it is
impossible to get a reasonably accurate estimate of the net effects of
institutional quality on earnings.
However, in analyzing the evidence we would argue that, in addition to
such factors as race, sex, family socioeconomic factors, educational
attainment, measures of labor market experience, and the like, obtaining an
unbiased estimate of the net, direct impact of institutional quality on individual
earnings means that four additional influences need to be taken into
account. These are: 1) cognitive or
intellectual ability, 2) ambition, 3) major field of study during college, and
4) the differential costs of attending different kinds of institutions. As previously pointed out in this chapter,
cognitive ability and ambition are important considerations because they are
not only highly correlated with attending a selective or elite institution (e.g., A.
Astin, 1993b; Dale & Krueger, 1999; Lillard & Gerner, 1999; Pascarella
& Terenzini, 1991), but are also salient predictors of earning potential
(Monks,
2000; Murnane et al., 1995; Sweetman, 1994a, 1994b; Whitaker & Pascarella,
1994). Similarly, it is important to take into
account major field of study because selective/prestigious institutions tend to
offer academic fields of study that lead to the most lucrative jobs (Jacobs,
1999). Finally, failure to account for the
substantially higher costs typically associated with attending a selective/prestigious
(and often private) college can lead to inflated estimates of the actual net
earnings benefits associated with attendance and graduation from such
institutions (Behrman, Rosenzweig, & Taubman, 1996; Brewer, Eide, & Ehrenberg,
1999; S Thomas, 1998; S. Thomas, 2000). Nearly all of the effects of
college quality on earnings is derived from secondary
analyses of preexisting data sets. The
variables represented in most of these data sets simply do not permit one to
introduce controls for all, or even most, of the important confounding
influences. Consequently, as suggested
by Kane (T. Kane,
1998, p. 432) in a
summary caution about research on college quality and earnings, “what looks
like an effect of attending an elite college may really be an effect of
unmeasured preexisting differences in academic or earning potential.”
Our
present synthesis is based on evidence from 26 individual published and
unpublished studies which appeared between 1989 and 2000. These investigations analyze data from
numerous independent data sets. The
specific data sets and the studies that employ them were as follows:
1. The National
Longitudinal Study of the High School Class of 1972-1979, and 1986 follow-ups (Arcidiacono,
1998; Brewer et al., 1999; Dale & Krueger, 1999; Hoxby & Long, 1999;
James & Alsalam, 1993; James, Alsalam, Conaty, & To, 1989; Knox et al.,
1993; Loury, 1997; Sweetman, 1994a, 1994b).
2. The
High School and Beyond 1980 and 1982 cohorts followed up in 1986 and 1991,
respectively (Brewer & Ehrenberg, 1996; Brewer, Eide, &
Ehrenberg, 1996; Fitzgerald, 2000; Fox, 1993; Hilmer, 2000; T. Kane, 1998;
Loury, 1997).
3. The National Longitudinal Survey of Youth, 1987-89, 1993, and 1995 follow-ups (Daniel et al., 1996a; Daniel, Black, & Smith, 1996b; Hoxby & Long, 1999; Monks, 2000).
4. The College and Beyond 1976 cohort followed up in 1995 (Bowen & Bok, 1998; Dale & Krueger, 1999).
5. The Baccalaureate and Beyond Study of 1992-1993 graduates followed up one year later (S Thomas, 1998) and four years later (S. Thomas, 2000).
6. The National Center for Education Statistics Surveys of Recent College Graduates: 1985-86 graduates followed up in 1987 (Rumberger & Thomas, 1993); 1989-90 graduates followed up in 1991 (Tsapogas et al., 1994).
7. The National Science Foundation New Entrants Survey of 1992 graduates followed up in 1993 (Tsapogas et al., 1994).
8. The Occupational Changes in a Generation, 1972 data (Hoxby & Long, 1999).
9. The Cooperative Institutional Research Program data: 1972 freshmen followed up in 1980 (Kingston & Smart, 1990); 1985 freshmen followed up in 1994 (Avalos, 1996).
10. The Panel Study
of Income Dynamics from 1975 to 1992 (Turner,
1999, April).
11. A survey of
identical and nonidentical female twins born in Minnesota and followed-up in
1993 at about age 45-46 (Behrman,
Rosenzweig et al., 1996).
The
body of evidence yielded by these investigations would suggest the following
general conclusions. First, although
there are some clear exceptions (Arcidiacono,
1998; Avalos, 1996; James & Alsalam, 1993; Knox et al., 1993; S Thomas,
1998; Tsapogas et al., 1994), the weight of evidence
suggests that measures of institutional quality, and particularly student body
selectivity, have statistically significant, positive net impacts on subsequent
earnings. Our best estimate is that, net
of other influences (including both individual student characteristics and
other institutional characteristics such as private control and size),
attending a college with a 100 point higher average SAT score (or ACT
equivalent) is associated with about 2 to 4% higher earnings in later life. [We
note that this estimate is somewhat more conservative than other summaries (e.g., Dale
& Krueger, 1999; Hilmer, 2000), but this difference is
likely attributable to the fact that we derive our estimates from a somewhat
broader range of studies.] Moreover,
when differential tuition costs are taken into account to adjust for the fact that
the most selective institutions are typically private, the positive effect of
attending a selective or elite institution on subsequent earnings is reduced
but does not disappear (e.g., Behrman et al., 1994; Brewer & Ehrenberg, 1996; Brewer et al.,
1999; Sweetman, 1994a). Second, consistent with the
conclusions from our 1991 synthesis, there is also evidence to suggest that the
impact of institutional selectivity on earnings is nonlinear. Only those elite institutions at the very top
of the selectivity distribution may have a substantial impact on earnings (e.g., Fox,
1993; Hilmer, 2000; Kingston & Smart, 1990). Third, there is empirical support for the
contention that the net impact of institutional selectivity or similar quality
measures on earnings has increased over time.
Investigations that consider the effects of college selectivity for
different national cohorts in different time periods tend to find that its
estimated impact on earnings is of a somewhat larger magnitude in more recent
than in older cohorts (Brewer et
al., 1996; Hoxby & Long, 1999; Loury, 1997; Turner, 1999, April). Finally, there is also evidence suggesting
that, in addition to its statistically significant direct effect on earnings,
college selectivity may also have a positive indirect effect due to its
enhancement of educational attainment and graduate or professional school
attendance (Arcidiacono,
1998; Eide, Brewer, & Ehrenberg, 1998). Since these studies do not control for either
precollege educational or occupational aspirations, however, it is likely that
this indirect effect is biased upward by some unknown amount.
Although
most of the evidence on institutional quality and earnings employs various
measures of selectivity as the primary quality indicator, there is also
evidence to suggest that other quality indicators may be linked with
earnings. Unfortunately, there is little
in the way of evidence that is consistent across studies analyzing different
samples. For example, with controls for
other college characteristics as well as individual-level confounding
variables, Daniel, Black, and Smith (1996a;
1996b) found that
expenditures per student had a significant, positive effect on wages for men,
though not for women. However, there is
only mixed support for this finding in the work of Behrman, Rosenzweig, and
Taubman (1996), Dale and Krueger (1999), and Fitzgerald (2000), and none at all in
findings reported by James and Alsalam (1993) and Tsapogas, Cahalan, and
Stowe (1994). Similarly, Tsapogas, Cahalan, and Stowe found
that percent of faculty with a Ph.D. positively influenced earnings in one
national sample they analyzed, but not in the other. Moreover, there was little support for the
unique, positive impact of percent of faculty with a Ph.D. in the earnings
functions of Daniel, Black, and Smith (1996a;
1996b). Behrman,
Rosenzweig, and Taubman did find that average faculty salaries at the
institution attended positively influenced the subsequent earnings of women,
but we uncovered no independent replication of their evidence.
Aside
from various measures of institutional selectivity, we uncovered only one
institutional quality indicator, faculty/student ratio, that
was found to have a significant, positive net effect on earnings across
independent samples. Both Behrman,
Rosenzweig, and Taubman (1996) and Daniel, Black, and
Smith (1996b) found that attending an
institution with a high faculty/student ratio had a significant, positive
effect on earnings, net of other factors.
However, even here the overall findings are inconsistent. In their analyses of two independent national
samples, Tsapogas, Cahalan, and Stowe (1994) found that an institution’s
faculty/student ratio had a significant, net positive effect on earnings in one
sample, and a significant, net negative effect on earnings in the other
sample. Similarly, Fitzgerald's (2000) analyses of the 1991
follow-up of the 1980 High School and Beyond cohort reported that an
institution's ratio of faculty to students had no net impact on women's
earnings and a small negative effect on the earnings of men.
Thus,
the bottom line would appear to be that, when institutional quality is defined
largely in terms of academic or student-body selectivity, it has a generally
consistent positive effect on subsequent earnings. Our estimate is that each hundred point
increase in the average SAT score (or ACT equivalent) of the entering students
at a college increases earnings by about 2 to 4%, though earnings may be most
clearly enhanced by attending an institution at the very highest or elite
levels of the selectivity distribution.
We would argue, however, that the body of research evidence on which we
base this conclusion probably provides an inflated estimate of the impact on
subsequent earnings of having a bachelor’s degree from a selective
institution. Due in large measure to the
fact that they are generally conducting secondary analyses of existing data
sets, nearly every investigation we reviewed in this body of research was
unable to control for one or more salient confounding variables. This was the case for even the most
meticulously conducted and methodologically rigorous studies. For example, Brewer and Ehrenberg (1996) considered cognitive
ability and differential tuition costs, but did not control for either
undergraduate major or an individual’s precollege ambition. Both Bowen and Bok (1998) and Fitzgerald (2000) introduced statistical
controls for cognitive ability and major field of study, but not for
differential tuition costs or ambition.
Most recently, Thomas (2000) controlled for cognitive
ability and academic major and considered differential costs in the form of a
debt/earnings ratio. However, he
included no ambition measures in his prediction of earnings.
It
is measures of individual ambition that are almost universally absent in
investigations of the impact of college quality on earnings.[19] This absence should probably come as no great
surprise as measuring ambition in a way that predicts one’s future economic
success is a nontrivial challenge.
Unfortunately, the inability to adequately specify an individual’s
ambition in regression models does not prevent unmeasured or unobserved
ambition from confounding the relationship between the selectivity of the
college one attends and his or her subsequent earnings. In short, elite, highly selective colleges
may simply recruit and enroll students who would have a high earnings capacity,
irrespective of where they went to college.
This
issue has been creatively addressed in an important study by Dale and Krueger (1999). They hypothesized that, given broad public
awareness of the link between attending an elite college and career success,
the selectivity of the colleges to which a student applies may signal
unaccounted for ambition and earnings capacity.
They tested this hypothesis for a combined sample of men and women by
reanalyzing data from the 1995 follow-up of the 1976 cohort from the College
and Beyond data set. (Previous analyses of this data
by Bowen and Bok (1998) had yielded significant net
positive effects of college selectivity on 1995 earnings.) A basic equation was
developed which regressed the natural logarithm of 1995 earnings on predicted
parental income, individual SAT score, sex, race, high school academic achievement,
collegiate athletic participation, and college selectivity (average SAT
score). In this equation college
selectivity had a significant, positive effect on earnings. However, when measures of the average
selectivity of the colleges to which one applied and the number of applications
one made were added to this equation, the effect of college selectivity on
earnings was reduced to a magnitude that was trivial and nonsignificant. Furthermore, this finding appeared to be
robust. Almost exactly the same results
were obtained when the same control for ambition was applied to a combined
sample of men and women from the 1986 follow-up of the National Longitudinal
Study of the High School Class of 1972—a more nationally-representative sample
than College and Beyond. When a measure
of precollege ambition was taken into account in either sample, students who
attended more selective institutions did not earn more than their counterparts
who were accepted and rejected by comparable schools but attended less selective
institutions.
Despite
the volume of evidence concerning college selectivity and earnings reviewed
above, we tend to agree with Dale and Krueger (1999, p.
29) that their
“findings cast doubt on the view that school selectivity, as measured by the
average SAT score of the freshmen who attend a college, is an important
determinant of students’ subsequent incomes.”
Put another way, extremely bright and ambitious students (i.e., those
with a high earnings capability) are more likely than other students to attend
and graduate from highly selective colleges.
Whether such elite institutions contribute significantly more to those
students’ earnings capabilities[20]
than would less selective schools, however, is problematic.[21]
In
addition to the problem of unmeasured ambition, there is also the question of
which students are really receiving significant economic returns from attending
a selective institution. There is at
least some evidence to suggest that studies that fail to take into account a
student’s educational path, practically a universal characteristic of the
existing body of research, overestimate the effects of institutional
selectivity for what may be the majority of students. In an analysis of the 1986 follow-up of the
nationally-representative High School and Beyond sample, Hilmer (2000) estimated the net returns
to undergraduate college selectivity for three groups of male graduates: direct
attendees (those who initially enrolled at the institution and remained there
through graduation); university transfers (those who transferred to the
institution from another four-year college); and community college transfers
(those who transferred to the institution from a two-year community
college). With controls for such factors
as race, high school and college grades, tested math and reading ability,
college major, labor market experience, and having a postgraduate degree, but
not ambition, the overall effects of college selectivity (average student SAT
score) on earnings were trivial and nonsignificant for direct attendees. Four-year and community college transfers
derived significant economic returns from selectivity, but only if they
transferred to, and graduated from, a four-year institution that had an average
student SAT score of 1200-1400. Since
four-year and two-year college transfer students comprised only about a third
of Hilmer’s nationally-representative High School and Beyond sample, his
findings suggest that for the majority of male four-year college graduates
(direct attendees) the selectivity of the college attended has little impact on
their subsequent economic success.
Institutional
Control (Private Versus Public)
Career
Choice
There
is some limited evidence that institutional control may have an impact on the
prestige of one's career choice. In
Astin's (1993b) analyses of the 1985-89
Cooperative Institutional Research Program data, he attempted to estimate the
effects of different institutional characteristics on college seniors' choice
of various careers. With controls for
initial career choice, other individual-level background traits, institutional
characteristics, and measures of student academic and social involvement in
college, attending a private university had a positive influence on seniors'
choice of physician as a career.
Conversely, attending a private institution had a negative effect on
choice of school teacher as a career.
Occupational
Status
We found little to suggest
that attending a private (as compared to a public) postsecondary institution
had anything more than a trivial and statistically nonsignificant influence on
overall occupational status. Analyzing
the 1986 follow-up of the National Longitudinal Study of the High School Class
of 1972, Knox, Lindsay, and Kolb (1993) introduced statistical
controls for race, sex, family background, tested academic ability, college
grades, college major, educational attainment, institutional selectivity, and
institutional size. In
the presence of such controls, attending a private (versus public)
institutional as an undergraduate had only a small, chance influence on 1986
occupational status. Consistent
results are reported by Dey, Wimsatt, Rhee, and Waterson (1998) analyzing the 1974-75 and
1992-93 follow-ups of the Wisconsin Longitudinal Study of 1957 High School
Seniors.
Earnings
We
uncovered a substantial body of studies that attempted to estimate the unique
impact of attending a private (versus public) institution on earnings. The specific data sets and studies that
employ them are as follows:
1. The
National Longitudinal Study of the High School Class of 1972, 1986 follow-up (Arcidiacono, 1998; James & Alsalam, 1993;
James et al., 1989; Knox et al., 1993; Sweetman, 1994a, 1994b).
2. The National Center for Education Statistics Surveys of Recent College Graduates: 1985-86 graduates followed up in 1987 (Rumberger & Thomas, 1993); 1989-90 graduates followed up in 1991 (Tsapogas et al., 1994).
3. The National Science Foundation New Entrants Survey of 1992 graduates followed up in 1993 (Tsapogas et al., 1994).
4. The Baccalaureate and Beyond Study of 1992-1993 graduates followed up one year later (S Thomas, 1998).
5. The National
Longitudinal Survey of Youth, 1987-1989, and 1993 follow-ups (Daniel et
al., 1996b; Monks, 2000).
6. The High School
and Beyond 1980 cohort followed up in 1986 (Fox, 1993).
7. The Cooperative
Institutional Research Program data, 1985 freshmen followed up in 1994 (Avalos,
1996).[22]
8. A survey of
identical and nonidentical female twins born in Minnesota and followed-up in
1993 at about age 45-46 (Behrman,
Rosenzweig et al., 1996).
With
two exceptions (Avalos,
1996; Behrman, Rosenzweig et al., 1996), all of the studies cited
above attempt to control, not only for individual student characteristics
(e.g., race, sex, socioeconomic background, tested ability, and the like), but
also for a measure of the academic selectivity of the institution
attended. Thus, the estimates they
report are for attending and graduating from a private institution,
irrespective of its level of selectivity.
About half of these studies find a small, but statistically significant,
positive effect on earnings accruing to students who receive their bachelor's
degree from a private college. The other
half find nonsignificant, but generally small positive
effects. Across all studies that provide
requisite information, we estimate the average net earnings advantage
associated with graduating from a private institution (irrespective of its
level of selectivity) to be about 3%.
Due to the designs of the studies, however, this estimate doesn't
discount the differential tuition costs between attending private versus public
institutions.[23] Were these differential tuition costs taken
into account, the net earnings premium associated with attending a private
institution would in all likelihood be considerably reduced, at least early in
one's career. Thomas (1998), for example, shows how
attendance at a private (versus public) institution leads to a statistically
significant and substantially higher debt to earnings ratio for recent college
graduates. The estimates also do not
take into account individual precollege ambition or earnings capability, which
might be differentially distributed across private and public institutions in
much the same way it was differentially distributed across institutions
differing in selectivity (Dale &
Krueger, 1999).
There
is also limited evidence to suggest that different types of private colleges
may differentially influence earnings, even when their level of selectivity is
held constant. For example, Sweetman (1994a;
1994b) found that
only those private colleges that were not affiliated with a church had a
significant positive influence on earnings.
James and Alsalam (1993) found that, at least for
men, earnings were significantly enhanced by attending a private college only
if the college was located in the northeastern United States. These findings, however, are based on single
samples and await replication. Moreover,
it is not clear if the private nonsectarian or private northeastern categories
are really proxies for other institutional characteristics.
We
uncovered one study (Wolf-Wendel,
1998) that
estimated the effect of attending a private (versus public) institution on the
career eminence or success of women.
Career eminence was operationally defined as inclusion in one of several
national Who's Who compilations: Who's Who in
Carnegie Classification
Earnings
A
modest body of research in the 1990s has attempted to estimate the effect of
the Carnegie Classification of institutions on earnings. The Carnegie Classification (Carnegie
Foundation for the Advancement of Teaching, 1994) places four-year
institutions in the following general categories: Research Universities (I and
II, depending on annual number of doctorates awarded and external research
funding); Doctoral Universities (I and II, depending on range of doctoral
programs and number of doctorates awarded); Comprehensive Institutions (I and
II, depending on range of master's programs and master's degrees awarded—these
institutions have no doctoral programs); Liberal Arts Colleges (I and II,
depending on selectivity); and Specialized Institutions (e.g., medical,
engineering, business, and the like).
Unfortunately, these classifications are confounded by such factors as
student body selectivity, private (versus public) control, institutional resources,
and size. Consequently, findings based
on the Carnegie Classification might well represent proxies for other
institutional characteristics. For
example, in analyses of the 1986 follow-up of the National Longitudinal Study
of the High School Class of 1972, Grubb (1992b;
1995b) sought to
determine if the net economic returns to a bachelor's degree differed in
magnitude for students graduating from different Carnegie Classification
institutions. Net of such factors as
race, family income, high school grades, tested ability, and job experience,
the returns (versus a high school degree) were relatively stable across the
different institutional classifications, except for the categories having the
most and least selective institutions.
Across
all the studies we uncovered that considered the economic returns to earning a
bachelor's degree from different Carnegie-type institutions, only Specialized
Institutions (e.g., those focusing on medical specialties, business,
engineering, and the like) had a consistently positive net effect on earnings (Bellas,
1998; Monks, 2000; Tsapogas et al., 1994). Moreover, this positive effect remained
statistically significant, even when measures of institutional selectivity were
taken into account (Monks,
2000; Tsapogas et al., 1994). In all these studies, the comparison group
was either Liberal Arts Colleges I and II grouped together (Bellas,
1998; Monks, 2000) or Liberal
Arts Colleges II (Tsapogas
et al., 1994). The average earnings advantage accruing to
graduates of Specialized Institutions (versus graduates of Liberal Arts
Colleges) was about 19%.
Evidence
with respect to the relative economic returns linked to a bachelor's degree
from other Carnegie-type institutions is markedly less consistent. Monks' (2000) analyses of the 1993
follow-up of the 1979 cohort of the National Longitudinal Survey of Youth found
that, even in the presence of controls for student background characteristics,
work experience, and a measure of institutional selectivity, graduating from a
Carnegie Research University, Doctoral University, or Comprehensive (Master's)
University (versus a Liberal Arts College I or II) provided a positive and
statistically significant advantage in earnings. There was little support for this, however,
in analyses of: the NCES Recent College Graduates Survey and the NSF New
Entrants Survey (Tsapogas
et al., 1994); and the
1991 follow-up of the High School and Beyond (HSB) 1980 cohort (Fitzgerald,
2000). With similar controls in place, including
measures of institutional selectivity, there were no significant earnings
differences in the NSF New Entrants Survey between Liberal Arts II graduates,
on the one hand, and graduates of Research, Doctoral, or
Bellas' (1998) analyses of the 1993
Baccalaureate and Beyond study suggest that graduation from a Research or
Doctoral University (versus a Liberal Arts College) has a modest, positive
indirect effect through labor market experience and occupational
classification. Because she could not
control for institutional selectivity, however, it is unclear how much this
indirect effect might be confounded.[24]
Although
they do not place major focus on the Carnegie typology, three additional
studies have estimated the economic premium associated with earning a
bachelor's degree from an institution with a doctoral program. In these studies, doctoral program
institutions were compared with all others, but, like the studies reviewed
above that employed the Carnegie classifications, the results were
inconsistent. Behrman, Rosenzweig, and
Taubman (1996) found that receiving a
bachelor's degree from a doctoral granting institution had a positive net
influence on subsequent earnings, but both James, Alsalam, Conaty, and To (1989), and Hilmer (2000) report findings indicating
that it did not. Furthermore, Hilmer
also reports an additional finding suggesting that graduating from a Research I
University may have actually had a small negative impact on subsequent
earnings. In all three investigations,
controls were introduced for institutional quality measures as well as
individual-level student characteristics.
Only the James et al. and Hilmer studies also included a direct measure
of institutional selectivity, however.
Generally,
then, when institutional selectivity is taken into account, it is questionable
that either an institution's Carnegie classification or its doctoral/research
orientation has a consistent, statistically significant link to an individual's
subsequent earnings. The one exception
to this finding appears to be graduation from a Carnegie-Type Specialized
institution; and this exception is likely because such institutions frequently
focus on preparing individuals for occupational fields characterized by high
economic returns (e.g., medical specialization, engineering, business).
Institutional Size
Occupational
Status
We
uncovered little evidence in the research of the 1990s to suggest that institutional
size has anything more than a small and statistically nonsignificant impact on
occupational status. Analyzing data from
the 1986 follow-up of the National Longitudinal Study of the High School Class
of 1972, Knox, Lindsay, and Kolb (1993) introduced controls for
such individual- and institutional-level variables as race, sex, socioeconomic
status, college grades and major, institutional selectivity, and private
(versus public) control. In the presence
of these controls, the size of the institution attended (operationally defined
as student enrollment) had a small, positive, but statistically nonsignificant
impact on 1986 occupational status.
Generally similar results are reported by Dey, Wimsatt, Rhee, and
Waterson (1998) in their analyses of the
1974-75 and 1992-93 follow-ups of the Wisconsin Longitudinal Study of 1957 high
school seniors.
Earnings
A
modest body of research has estimated the net effect of attending institutions
of varying size (typically defined as student enrollment) on subsequent
earnings. With the exception of two
studies, which report weak evidence for a statistically significant, negative
effect (Behrman,
Rosenzweig et al., 1996) or a very small nonsignificant, negative effect (Hilmer,
2000), the
evidence consists of studies reporting that institutional size either has a
significant, positive net influence on subsequent earnings (Avalos,
1996; Dowd, 1999; James & Alsalam, 1993; S Thomas, 1998), or a small and positive,
but statistically nonsignificant net influence on earnings (James et
al., 1989; Knox et al., 1993; Tsapogas et al., 1994). Importantly, we believe, the studies that
find a significant, positive impact of institutional size also introduce, in
addition to controls for individual-level characteristics, controls for either
institutional selectivity (Dowd,
1999), private
control (Avalos,
1996), or both
institutional selectivity and private control (James
& Alsalam, 1993; S Thomas, 1998). Indeed, Dowd found that graduates of large
institutions (universities) that were substantially less selective actually had
an earnings advantage of about 14-15% over graduates of the most elite liberal
arts colleges, those with an average student body SAT score greater than
1300. We conclude that the weight of
evidence suggests that, other things being equal, institutional size confers a
small, but statistically significant advantage in earnings. (The nature of the results reported by
different studies makes determination of the magnitude of the effect
problematic.) As suggested by Dowd, this
positive effect of graduating from a large institution probably stems from
economies of scale in providing diverse programs and major fields of study, as
well as more extensive job networks due to larger alumni groups. Furthermore, by means of the greater number
of majors and preprofessional programs they offer, larger institutions typically
have a wider range of links with occupational and economic groups in
society. Other factors being equal, this
fact may afford larger institutions superior status-allocating capacity than
smaller institutions (Pascarella
& Terenzini, 1991).
In
previous chapters in this book we have seen that African-American students
attending historically Black colleges (HBCs) not only make content knowledge
and intellectual gains that are equal to, if not greater than, their
counterparts attending predominantly white institutions (PWIs), they also are
more likely to complete a bachelor's degree.
Does graduation from HBCs confer any distinct advantages on
African-Americans in their career?
Career
Preparation and Occupational Aspirations
A
small body of evidence suggests that African-American students attending HBCs
tend to believe they have made greater gains in preparation for a career and
report a higher level of occupational aspirations than their counterparts
attending PWIs. For example, DeSousa and
Kuh (1996) asked African-American
students attending an HBC and a PWI to indicate the gains they felt they had
made during college in vocational and career skills (e.g., acquiring knowledge
and skills applicable to a job, gaining a range of information that might be
relevant to a career). HBC students
reported making gains on the scale that were about .58 of a standard deviation
larger than African-American students at PWIs.
Such a finding is consistent with that of Cole, Barber, Bolyard, and
Linders (1999) who found that
African-American students at HBCs scored significantly higher than their
counterparts at PWIs on an index measuring the extent to which they focused on
school as a means to an occupation versus getting a broad liberal arts
education. The designs of these studies,
however, make it difficult to determine if these differences in self-reported
gains in vocational and career skills, and focus on college's instrumental value
in preparing one for a career, are attributable to the influence of attendance
at an HBC or PWI. They may merely
reflect differences in the precollege career orientations of African-American
students who choose to attend HBCs versus PWIs.
The
unique influence of attending an HBC on African-American students' occupational
aspirations has been addressed by Allen (1992) and Wenglinsky (1996). In Allen's study of African-American students
at eight HBCs and eight PWIs, statistical controls were introduced for such
factors as educational aspirations, class level, college and high school
grades, sex, socioeconomic status, self concept, and the like. In the presence of these controls, attending
an HBC (versus a PWI) had a modest, but statistically significant positive,
direct effect on a measure of the prestige and power dimensions of one's
occupational plans. HBC attendance also
had a modest, positive indirect effect on occupational plans, transmitted
through the positive effects of HBC institutions on students' social
involvement during college. Although no
controls could be introduced for prior educational or occupational aspirations,
consistent findings are reported by Wenglinsky (1996) in analyses of the more
nationally-representative National Postsecondary Aid Study of 1990. Similarly, Astin (1993b) reported that attending an
HBC had a significant positive, net influence on seniors' choice of physician
as a career.
Occupational
Status, Earnings, and Career Eminence
Evidence
concerning the impact of graduating from an HBC (versus PWI) on
African-Americans' actual occupational and economic attainments is mixed. For example, Ehrenberg and Rothstein (1994) analyzed data from the 1979
follow-up of the National Longitudinal Study of the High School Class of 1972
to determine if an HBC conferred an early occupational status or earnings
advantage on African-Americans.
Controlling for gender, SAT scores, high school rank, educational
attainment, parents' education and income, father's occupational status, and
the unemployment level in one's state of residence, attending an HBC (versus
PWI) had only statistically nonsignificant effects on 1979 occupational status
and 1979 earnings. Similar findings are
reported by London (1998) for occupational status,
though with a much smaller and focused sample.[25] However, analyzing data from the same sample,
but with a later follow-up (1986), Constantine (1994;
1995) reported
findings suggesting that attendance at an HBC may indeed have a positive impact
on African-Americans' subsequent wages.
She used two different samples to derive her estimates. In the first, she attempted to reproduce the
analytical model of Ehrenberg and Rothstein by restricting the sample to
African-Americans in four-year institutions.
Controlling for such influences as high school achievement, tested
ability, sex, family background, athletic participation, and region of the country,
she found that attendance at an HBC (versus PWI) conferred a statistically
significant advantage of about 11% in 1986 wages. When attainment of a bachelor's degree was
added to the equation the advantage dropped to about 8% and became
nonsignificant, suggesting that part of the positive total impact of attending
an HBC was indirect, transmitted through the positive effect of HBC attendance
on African-American students' completion of a bachelor's degree.
In
Constantine's (1995) second sample, she included
all African-American students, irrespective of whether they enrolled in a
four-year institution. She initially
used background and other characteristics to predict, or model, three choices:
no four-year college (i.e., high school or two-year college),
attendance at a four-year HBC, or attendance at a four-year non-HBC (PWI). Incorporating a term representing a
correction for this choice or selection in her basic regression model yielded
two important findings. First, the
negative selection term suggested that the unobservable characteristics that
led a student to select an HBC (over a PWI) were probably the ones that would
have caused lower wages. Second, with
this correction for selection taken into account, the estimated value-added in
1986 wages from attending an HBC (versus PWI) was actually about 38%.
Other
research presents a less optimistic picture of the net impact of attending an
HBC on African-Americans' career and economic success. For example, Solnick (1990) examined the impact of
attending an HBC on the job success of a sample of African-American college
graduates employed by a large U.S. manufacturing firm. Three job success outcomes were predicted:
starting salaries, salary growth, and promotion. With controls introduced for extensive
personal and job characteristics, the resources of the colleges attended, and
for possible attrition bias, African-American employees who were graduates of
HBCs had a modest, but statistically significant 4% advantage in starting
salary over their counterparts who graduated from PWIs. Conversely, HBC graduates were significantly
disadvantaged in both percentage of salary growth and the probability of being
promoted within two years of being hired.
In
his analyses of the 1997 follow-up of 1993 bachelor's degree recipients in the
Baccalaureate and Beyond study, Thomas (2000) estimated the net impact of
attending an HBC on both annual earnings and the debt to earnings ratio. Controlling for such factors as sex, race,
family background, SAT scores, college grades and major, variables capturing
labor-market experience, and both the selectivity and private/public control of
the institution attended, earning a bachelor's degree from an HBC (versus all
other institutions) had no significant impact on the 1997 debt to earnings
ratio. Graduates of HBCs did, however,
have a statistically significant, 23% disadvantage in 1997 earnings. Unfortunately, the sample used by Thomas
includes individuals of all races, not just African-Americans. Consequently, he is comparing graduates of
HBCs, who presumably are nearly all African-Americans, with graduates of all
other institutions, irrespective of race.
Thomas did, however, include dummy variables to represent
African-American as well as Asian, Hispanic, and Caucasian (coded o) racial
categories. Thus, a reasonable
interpretation of his findings is that for individuals in the same racial
category (including African-Americans), the average net effect of graduating
from an HBC is a 23% disadvantage in 1997 earnings. Employing a similar sample and analytic
design with the 1991 follow-up of the High School and Beyond 1980 cohort,
Fitzgerald (2000) reported that graduation
from an HBC had a statistically non-significant net effect on early career
earnings of both men and women.
Obviously, the effect of HBC graduation on African-Americans' earnings
would have been estimated more precisely with a sample limited to
African-Americans. Nevertheless, the
findings of both Thomas and Fitzgerald are not irrelevant to the body of
evidence.
In
addition to the body of evidence concerning earnings, Wolf-Wendel (1998) sought to estimate the net
impact of graduating from an HBC on the career eminence of African-American
women. In the same study, she also
estimated the impact on career eminence of Latino women attributable to earning
a bachelor's degree from a primarily Hispanic serving institution (i.e., an
institutional member of the Hispanic Association of Colleges and
Universities--HACV). Institutions were
the unit of analysis and career eminence was defined as inclusion in one of two
respective Who's Who compilations: Who's Who Among
Black Americans and Who's Who Among Hispanic Americans. Net of statistical controls for institutional
control and gender composition, African-American women graduates of
historically Black colleges were significantly over-represented in terms of
career eminence. Similarly, net of controls
for institutional control, selectivity, and gender composition, graduating from
a primarily Hispanic serving institution (i.e., a member of the HACV) had a
significant, positive influence on the career eminence of Latino women. As with Wolf-Wendel's (1998) findings concerning
graduation from a private college, however, there is the very real possibility
that these findings are also confounded by the inability to control for such
factors as the average career aspirations, ambition, and family backgrounds of
students entering HBCs and Hispanic serving institutions.
Overall,
it is difficult to form a firm conclusion about the impact of attending an historically Black institution on African-American's
career and economic success.
Historically, Black colleges appear to enhance the career aspirations of
African-American students; and there is some evidence that a bachelor's degree
from an HBC is at least associated with one dimension of career eminence among
African-American women. However, the
weight of evidence with respect to the influence of graduating from an HBC on
African-American's occupational status, career mobility, and earnings is not
totally convincing. The study of
economic returns that follows African-American students furthest in their
careers (Constantine,
1995) also
yields the most positive estimates of HBC attendance on earnings or wages. Her findings are based on a single sample,
however, and await replication.
Although
the vast majority of evidence on the effects of college racial composition on
career and economic attainment focuses on historically Black colleges and
African-Americans, we uncovered four additional studies that estimated the
impact of an institution's student-body racial composition on the earnings of
non-African-Americans as well as African-Americans. Analyzing the four-year follow up of the 1993
Baccalaureate and Beyond study, Thomas (2000) introduced statistical
controls for an extensive set of individual-level and institutional-level
characteristics. These included: race,
sex, family income, college grades, college major, tested ability, section of
the country, and labor market experience at the individual level, and
selectivity, private (versus public) control, and attendance at an historically
Black college at the institutional level.
In the presence of such controls, graduates of colleges with more
diverse student bodies enjoyed a statistically significant earnings advantage
relative to those from more racially homogeneous campuses. On average, a 10% increase in non-white
students on campus led to a 3% increase in 1997 earnings, net of other factors. (Such results are quite similar to those found earlier for students
majoring in business, education, and health-related fields by Rumberger &
Thomas, 1993). Thomas concludes
that this finding may suggest that employers are recognizing and rewarding
recent graduates' experiences with diverse populations, and these experiences
are more likely to happen at institutions with diverse undergraduate student
bodies (Gurin,
1999).
Consistent,
if not totally comparable findings are reported by Daniel, Black, and Smith (1996a;
1996b) in their
analyses of the 1987-89 follow-up of the 1979 cohort of the National
Longitudinal Survey of Youth. In their
investigations, they created four categories representing the percent of
African-American students at each institution: less than 5%; 5-7%; 8-17%; and
more than 17%. Statistical controls were
introduced for such individual-level influences as tested ability, home and
family background, age, race, high school quality, college major, labor market
experience, and industry of employment, and for a composite measure of college
quality (e.g., selectivity, spending per student, faculty with Ph.D.s, and the
like) at the institutional level. Net of
such controls, they found that men attending colleges with between 5 and 7%
African-American students earned significantly more than those attending
colleges with fewer than 5% African-American students. Furthermore, men attending colleges with
between 8 and 17% African-American students had significantly higher earnings
than men at schools with fewer than 8% or more than 17% African-American
students. There was no significant
difference in the magnitude of the effect of college racial diversity for
African-American versus non-African-American men (Daniel et
al., 1996b). Thus, even with controls for college quality
and background characteristics, attending a college with a moderate level of
racial diversity (percent African-American) among its students significantly
raised earnings for both African-American and non-African-American men, and did
so about equally.
The
corresponding results for women were less clear (Daniel et
al., 1996a). Net of background characteristics and
institutional quality, African-American women who attended colleges with
between 5 and 7% African-American students earned significantly more than their
counterparts who attended colleges with less than 5% African-American
students. The trends in the evidence
also suggest they earned more than otherwise similar African-American women who
attend colleges with more than 8% African-American students. Percent African-American students at the
institution attended had only small and statistically nonsignificant effects on
the earnings of non-African-American women.
Since
it is unclear how many HBCs fell into the category of "more than 17%
African-American students," it is difficult to draw a direct comparison
between the findings of the Daniel, Black, and Smith (1996a;
1996b) studies
and those that compare African-American students who attend HBCs with those who
attend predominantly white institutions.
Nevertheless, the results reported by Daniel, Black, and Smith suggest
that, even if an African-American student does not attend an HBC, a modest
percentage of other African-Americans on campus may positively influence his or
her subsequent earnings. Furthermore,
taken together, the findings of Thomas (2000) and Daniel, Black, and
Smith (1996b) suggest the intriguing
possibility that non-African-American students, and particularly men, may
derive potential benefits from experiences on a racially diverse campus that
translate into subsequent economic advantages.
Institutional Gender Composition
As
of the middle of the 1990s, there were fewer than 70 baccalaureate-granting
women's colleges in the United States, and they granted slightly more than 2%
of all bachelor's degrees awarded to women (College
Entrance Examination Board, 1994; Ricci, 1994; Wolf-Wendel, 1998). Thus, in terms of both numbers of
institutions and numbers of graduates, single-sex women's colleges could be
considered only minor players in the overall national postsecondary
system. In terms of the accomplishments
and influence of their graduates, however, women's colleges are anything but
minor players. Graduates of women's
institutions hold positions of leadership and eminence in such fields as
government, business, the professions, and postsecondary education that are
dramatically out of proportion to their small numbers (H. Astin
& Leland, 1991; Forbes, 1998; Harwarth, Maline, & DeBra, 1997; Ledman,
Miller, & Brown, 1995; Tidball, Smith, Tidball, & Wolf-Wendel, 1999;
Touchton, Shavlik, & Davis, 1993). The major question for social scientists
interested in the impact of college is whether the marked accomplishments of
women's college graduates are the result of some unique socialization process
that goes on in women's colleges or merely reflect the recruitment of
particularly talented and ambitious young women to those institutions. A substantial body of research has addressed
this issue.
Acquiring
Career-Related Skills and Attitudes
A
number of scholars have been concerned with the extent to which attendance at a
women's college influences career-related skills and attitudes. Since women's institutions provide more
opportunities for women to exercise leadership skills as well as interact with
successful faculty role-models in a wide range of academic fields who are
themselves women, it seems reasonable to hypothesize that attendance at a
women's college would foster such outcomes as leadership skills, orientations
toward success or accomplishment, and drive to achieve (e.g.,
Miller-Bernal, 1993; Romano, 1996). With one exception (A. Astin,
1993b), however,
the weight of evidence from the 1990s has failed to support this
hypothesis. For example, in a
comprehensive and methodologically sophisticated investigation Smith, Wolf, and
Morrison (1995) used the 1986-90
Cooperative Institutional Research Program data to compare women at 30 women's
colleges with those who attended 173 private four-year coeducational
institutions. With statistical controls
for individual-level precollege variables and SAT scores, institutional
selectivity, and measures of academic and social involvement during college,
attending a women's college had only a small and statistically nonsignificant
direct effect on seniors' self-ratings of leadership ability and a scale
measuring success goals and outcomes (e.g., have administrative responsibility,
to become an authority in one's field, self-rating of drive to achieve, and the
like). Furthermore, the indirect effects
of attending a women's college on the same two variables were trivial in
magnitude. Quite similar findings, using
other iterations of the Cooperative Institutional Research Program data and
essentially the same general analytical procedures as Smith, Wolf, and Morrison
(1995) have been reported by Kim
and Alvarez (1995) for the acquisition of
job-related skills and preparation for graduate or professional school, by
McKinney (1997) for self-assessed
leadership ability, by Langdon (1997) for leadership ability and
drive to achieve, and by Tullier (1990) for career salience and
range of perceived career options.
Since
women's colleges (as compared to coeducational institutions) tend to provide a
larger percentage of female faculty role models who function effectively in
fields that are traditionally male-dominated and linked to high economic
returns (e.g., economics, mathematics, natural sciences), it also seems
reasonable to hypothesize that the environments of women's institutions may be
particularly effective in counteracting sex-stereotypic perceptions in women's
career aspirations and development (e.g.,
Riordan, 1994; Sebrechts, 1992; S. Solnick, 1995). Here, too, the evidence is mixed. On the one hand, we have the supportive
findings of Sebrechts (1992) and Solnick (1995). Summarizing a report from the Women's College
Coalition, Sebrechts points out that women at women's
colleges were three times as likely to earn a bachelor's degree in economics
and one and one-half times as likely to earn bachelor's degrees in the life
sciences, physical sciences, and mathematics than women at coeducational
colleges. Of course, such evidence could
merely reflect precollege differences in the intended majors of women who
enroll in women's and coeducational colleges.
More pertinent to the actual impact of women's colleges is Solnick's
study of changes in women's majors from entrance to graduation at eight women's
and seven coeducational colleges.
Depending on how broadly female-dominated majors (e.g., education,
social work, social sciences, and the like) are defined, about 40% to 75% of
women at the eight women's colleges who began in such majors shifted to neutral
or male-dominated fields (e.g., mathematics, natural sciences, economics, and
the like) during their college careers.
This shift compared to only about 25% of women at the seven
coeducational schools. Approximately 22%
of women at both types of schools left male-dominated majors.
Other
evidence, however, is less supportive of the notion that women's colleges
actually enhance the likelihood that women will choose nontraditional majors
and careers (Dickson,
1990; Touchton, Davis, & Makosky, 1991; Tullier, 1990). In contrast to Sebrechts (1992), Touchton, Davis, and
Makosky (1991) summarized a report from
the National Center for Education Statistics indicating that about the same
percentage of women in women's colleges and coeducational colleges received
bachelor's degrees in engineering, mathematics, and the physical sciences. Similarly, both Dickson (1990) and Tullier (1990) found that when women's and
coeducational colleges of about equal selectivity were compared, senior women
at both types of institutions were largely indistinguishable in terms of their
overall career choices and choice of a nontraditional (e.g., male-dominated)
career. The seeming contrast between
these findings and those of Solnick (1995) may in part be explained by
the fact that Solnick focused on major field of study, while Dickson and
Tullier focused on actual career choice.
The
evidence is also mixed with respect to the net impact of women's colleges on
women's actual entrance into nontraditional careers. For example, in their analyses of the 1971-80
Cooperative Institutional Research Program data, Stoecker and Pascarella (1991) attempted to estimate the
net effect of attendance at a women's versus a coeducational college on women's
entrance into a nontraditional/male-dominated occupation. Male-dominated occupations were operationally
defined by the percentage of males within each occupational group, using data
from the U.S. Bureau of Labor Statistics.
With statistical controls for such confounding influences as
individual-level background traits and aspirations, institutional selectivity
and size, college major, college grades, marital status, and educational
attainment, attending a women's college had only small and nonsignificant
direct and indirect effects on women's entry into male-dominated careers.
Generally, if not totally, consistent results are reported in a 1994 reanalysis of data indicating that graduates of women's colleges are substantially overrepresented in a specific male-dominated occupation—that of physician (Crosby et al., 1994). When different procedures and variables were employed to introduce previously absent controls for institutional selectivity, the effect of graduating from a women's college and becoming a physician either became nonsignificant or was substantially reduced in magnitude relative to other predictors. Furthermore, even with controls for institutional selectivity, it is quite possible that the relationship between attending a women's (versus coeducational) college and becoming a physician is still confounded by differences between the two institutional types in the percentages of women who aspire to a career as a physician when they begin college.
Other
evidence is somewhat more supportive of the belief that women's institutions
enhance the likelihood of women selecting a nontraditional career path. Sharpe and Fuller (1995) used the Doctoral Records
File maintained by the National Research Council to examine the physical
science and engineering doctorate productivity of the baccalaureate
institutions of the cohort of women who completed a bachelor’s degree between
1976 and 1986 and who earned a doctorate prior to 1992. Taking institutional size and Carnegie
Classification into account, the overall median physical science and engineering
doctorate productivity was significantly higher for historically women’s
colleges than for coeducational institutions.
Most of this effect was attributable to the over-representation of
women’s college graduates in earning a doctorate in chemistry. In both mathematics/computer science and
physics/earth science, graduates of women’s colleges demonstrated no
significant advantage over their counterparts with a bachelor’s degree from
coeducational institutions. As Sharpe
and Fuller point out, however, it is risky to attribute any of their findings
to the impact of institutional socialization.
It may simply be that women’s colleges tend to enroll a higher
proportion of women who aspire to careers in the physical sciences when they
begin postsecondary education than do coeducational institutions. Without taking these precollege career
dispositions into account, it is difficult to determine if the Sharpe and
Fuller findings represent a socialization or a
recruitment effect.
Workforce
Participation
Analyses
of two national data sets, the 1971-80 Cooperative Institutional Research
Program data (Stoecker
& Pascarella, 1991) and the 1986 follow-up of the National Longitudinal
study of the High School Class of 1972 (Riordan,
1992; Rothstein, 1995), suggest that attendance at a women's college has
little impact on the likelihood of women participating in the workforce. With controls for extensive individual-level
background characteristics, institutional selectivity and size, marital status,
college major, and educational attainment, both Stoecker and Pascarella (1991) and Rothstein (1995) found that the percent of
undergraduate women at an institution had only small and statistically
nonsignificant effects on the likelihood of a woman being employed. Riordan (1992) actually found that women's
college graduates were less likely to be employed after obtaining a bachelor's
degree than were women graduates of mixed gender colleges. Moreover, in the Rothstein investigation
women's workforce participation was also uninfluenced by the percent of female
faculty at an institution.
Occupational
Status and Earnings
The
weight of evidence with respect to the net impact of attending a women's
college on occupational status and earnings is inconsistent and
unconvincing. For example, in analyzing
data from the 1986 follow-up of the National Longitudinal Study of the High
School Class of 1972, Riordan (1992;
1994) found
that, net of such influences as family socioeconomic status, tested ability,
mental status, region of the country, and hours worked, attending a women's
(versus coeducational) college had a small, but statistically significant
positive effect on the status or prestige of a woman's occupation in 1986. This, however, was not replicated in
Riordan's (1993;
1995) analyses
of the 1986 follow-up of the 1980 High School and Beyond cohort. With statistical controls similar to those
employed in his analyses of the NLS-72 data, attendance at a women's college
reduced the likelihood of being married and increased one's occupational
aspirations, but had only a small and statistically nonsignificant effect on
the actual status of the job held by a woman in 1986. Similarly, in their analyses of the 1971-80
Cooperative Institution Research Program data, Stoecker and Pascarella (1991) found that attendance at a
women's college had only small and nonsignificant direct and indirect effects
on a woman's 1980 job status when the influence of salient individual- and
institutional-level variables was taken into account.
The
evidence pertaining to the impact of attendance at a women's college on
subsequent earnings differs little from that pertaining to its effect on
occupational prestige. Riordan's (1994) analyses of the 1986
follow-up of the NLS-72 data present the strongest evidence of a positive
impact. Net of other influences,
attending a women's college had a statistically significant, positive total
effect on 1986 earnings. Most of this
positive effect of attendance at a women's college was indirect, being
transmitted through a direct positive impact on 1986 occupational status which,
in turn, positively influenced earnings.
There is a good chance, however, that this effect is biased upward, or
inflated, because precollege (1972) occupational aspirations were not specified
and, therefore, not controlled statistically, in Riordan's regression
models. Such precollege aspirations are
important determinants of both subsequent occupational status and
earnings. For example, using essentially
the same database as Riordan (1994), both Inoue and Ethington (1997) and Whitaker and Pascarella
(1994) found that precollege
(1972) occupational status aspirations had a significant positive effect on
1986 occupational status, even when precollege educational aspirations and
subsequent educational attainment (among other variables) were taken into
account. Occupational status aspirations
also had a significant positive effect on 1986 earnings, even in the presence
of controls for educational aspirations, educational attainment, and
occupational status (Whitaker
& Pascarella, 1994). The importance of controlling for occupational
aspirations is also underscored in
Additional
evidence suggesting that attendance at a women's college may enhance subsequent
earnings is provided in Dowd's (1999) ten-year follow-up study of
graduates of 20 "highly prestigious" institutions. With controls for undergraduate major,
ethnicity, financial aid, geographic region, marital status, and dependent
children, women graduates of three highly selective liberal arts colleges
actually had significantly lower earnings than their counterparts at five less
selective universities. However, women
graduates of four less selective liberal arts colleges, three of which were
women's colleges, were not disadvantaged relative to the five comparison
universities. In terms of impact on
subsequent earnings, Dowd reasoned that the distinctive culture of women's
colleges may have compensated for the institutional size disadvantage of
liberal arts colleges relative to universities.
(Recall our earlier review indicating a positive influence of
institutional size on earnings.) While
such findings are intriguing, they are also based on an extremely small sample
of institutions with quite limited generalizability. Moreover, the results may be confounded by
the inability to control for precollege levels of career aspirations and
ambition.
With
the possible exception of Riordan (1994) and Dowd (1999), however, the weight of
evidence is reasonably clear in suggesting that no statistically significant
earnings benefit accrues to women who attend and/or graduate from a women's
college versus a coeducational institution (Behrman,
Rosenzweig et al., 1996; Daniel et al., 1996a; Riordan, 1993; Rothstein, 1995;
Stoecker & Pascarella, 1991; Sweetman, 1994a, 1994b). These studies tend to analyze data from
nationally-representative samples such as the 8- and 9-year follow-ups of the
1979 cohort of the National Longitudinal Survey of Youth; the 1986 follow-up of
the NLS-72 data; the 1986 follow-up of the 1980 cohort of the High School and
Beyond data; and the 1971-80 Cooperative Institutional Research Program
data. An additional data set analyzed
was a survey of identical and nonidentical female twins born in
While
they are each based on findings from a single study, and await replication, two
other findings are worthy of mention.
First, although Daniel, Black, and Smith (1996a) report that attending a
women's college had a net negative effect on a woman's earnings, this was not
the case for the economic productivity of a woman's spouse. Net of other influences, the percent of women
at the institution attended had a significant, positive effect on the earnings
of a woman's spouse. [Similar findings are reported by Riordan (1992) for husband's occupational
status, suggesting that the results of Daniel, Black, and Smith are not merely
fortuitous or artifactual.] Second,
Sweetman's (1994a;
1994b) analysis
of the 1986 follow-up of the NLS-72 data found that, net of other factors,
attending an all-male college (versus coeducational institution) conferred a
23% earnings advantage on white men.
Career
Eminence
We
uncovered only one study (Wolf-Wendel,
1998) that
estimated the net impact of attending a women's college on a woman's career
eminence. Institutions (versus
individuals) were the unit of analysis, and career eminence or success for
women was defined as earning a bachelor's degree after 1965 and being listed in
one of three Who's Who compilations—Who's Who in America, Who's
Who Among Black Americans, and Who's Who Among Hispanic Americans. Separate analyses were conducted for three
groups of women—White/European Americans, African-Americans, and Latinos. Wolf-Wendel essentially was trying to predict
the proportion of women baccalaureate graduates from four-year institutions
included in these Who's Who compilations. Net of such institutional characteristics as
selectivity, size, and private control, graduates of women's colleges were
dramatically overrepresented in the three Who's Who compilations. Clearly, Wolf-Wendel's study is limited by
the fact that she could not control for differences in the average levels of
precollege aspiration and ambition among women attending women's and
coeducational colleges. To some extent,
her findings could simply reflect differential recruitment of ambitious women
to women's and coeducational colleges, rather than any unique career
socialization that might occur at the former.
On the other hand, it is extremely difficult to argue with the magnitude
of Wolf-Wendel's estimates of the impact of women's colleges. The standardized regression coefficients for
institutional gender in her analyses vary between .27 and .59. Part of these large effects, of course, could
be attributable to the use of institutions rather than individuals as the unit
of analysis. Nevertheless, even if
institutional-level controls could have been introduced for entering student
ambition and aspirations, it is still questionable if Wolf-Wendel's estimates
of the effects of women's colleges on women's career eminence would be reduced
to statistical nonsignificance.
In
the Net-Effects of College section of this chapter, we reviewed the rather
unsurprising evidence that, on average, completion of a bachelor's degree
returned significantly higher levels of occupational status and earnings than
did an associate's degree. In this
section, we review studies that focus on whether starting postsecondary
education at a two- versus four-year college has
important implications for one's career.
Persistence in Mathematics, Science, and Engineering
We
uncovered two longitudinal studies (Grandy,
1998; Hilton, Hsia, Cheng, & Miller, 1995), analyzing the same data,
that estimated the net impact of starting postsecondary education at a two-
versus four-year institution. The
sample, developed from data collected by the Educational Testing Service,
consisted of 3,840 high-ability minority students (American Indian, African-American,
Mexican-American, and Puerto Rican) who in 1985 scored at least 550 on the
SAT-mathematics test and who indicated that they planned to major in
mathematics, science, or engineering (MSE) in college. (MSE majors were operationally defined as:
agriculture, architecture, bio-sciences, computer sciences, engineering,
medical and dental professions, mathematics, and physical sciences). The sample was followed up in 1990 to
determine whether or not they persisted in mathematics, science, or
engineering. MSE persistence in 1990 in
the Hilton et al. study was defined as: 1) receiving a bachelor's degree in MSE
and being engaged in full-time MSE work, 2) being enrolled full time in an MSE
graduate school (regardless of what their undergraduate major may have been),
or 3) having a bachelor's degree in an MSE field and being enrolled part time
in an MSE graduate program. In the
Grandy study, MSE persistence in 1990 was defined as working or studying, full-
or part-time (graduate or undergraduate), in an MSE field. With statistical controls for such factors as
tested verbal and mathematics ability, educational aspirations, family
socioeconomic status, high school math and science experiences, gender, college
grades, commitment to science during college, and the like, starting
postsecondary education at a two-year (versus four-year) college had a
statistically significant, negative direct effect on 1990 MSE persistence in
both studies and a statistically significant, negative (though reduced) total
effect on MSE persistence in the Grandy study.
Job Performance
We
uncovered only one study (Banta
& Associates, 1993) that compared the job performance of two- and
four-year college graduates. A
consortium of institutions in
Occupational
Status and Earnings
A
small body of research has estimated the net impact on subsequent occupational
status and earnings of starting postsecondary education at a two-year community
college versus a four-year institution.
In terms of statistical significance, the findings with respect to
occupational status are mixed, but they are quite similar in terms of the
magnitude of the effect. Monk-Turner
(1990) analyzed data from the National Longitudinal Survey of Labor Market
Experiences on men and women who were full-time workers in 1978 and were
between 24 and 34 years old. The
dependent measure was occupational status or prestige as measured by the
Socio-Economic Index or SEI. In the
presence of controls for age, a measure of mental ability, socioeconomic
background, work experience, educational attainment, race, sex, marital status,
and region of the country, starting postsecondary education at a two-year
college (versus four-year college) resulted in a statistically significant
disadvantage in 1978 occupational status of 2.83 points. On the other hand, using the same dependent
variable as Monk-Turner, analyses of the 1986 follow up of the National
Longitudinal Study of the High School Class of 1972 (NLS-72) data by Whitaker
and Pascarella (1994) led to a slightly different
conclusion. Controlling for sex, race,
family socioeconomic status, age, secondary school grades, and extracurricular
involvement, 1972 self-esteem, 1972 educational aspirations, 1972 occupational
aspirations, college grades, and educational attainment, starting at a two-year
college was associated with a statistically nonsignificant disadvantage in
occupational status of 1.13 points.
Thus, across both studies the direct disadvantage in occupational status
attributable to community college attendance was quite modest, about 2 SEI
points or .10 of a standard deviation (4 percentile points).[27]
In
addition to estimating the impact of entering postsecondary education at a two-
versus four-year college on subsequent occupational status, Whitaker and
Pascarella (1994) also estimated the corresponding
impact on 1986 earnings. To the controls
used in their prediction of 1986 occupational status (e.g., race, gender,
socioeconomic status, 1972 aspirations, 1986 educational attainment, and the
like), they added 1986 occupational status and hours worked per week. Net of these influences, starting
postsecondary education at a community college, versus a four-year institution,
had only small and statistically nonsignificant effect on 1986 earnings. Moreover, even without controls for 1986
educational attainment, occupational status, and hours worked per week, the
effect of attending a community college on 1986 earnings was still small and
nonsignificant. Analyzing the same data,
Adelman (1992,
February; 1994) reports
similar findings with respect to the impact of attendance at a community
college on both earnings and home ownership.
Although it does not speak directly to the impact of initially attending a community college versus a four-year institution on career success or earnings, it is worth briefly reviewing the findings of an additional study that speaks to the academic selectivity of the four-year institutions which community college transfers attend. As we observed in reviewing the evidence, there are certainly legitimate questions about the magnitude of the impact of four-year college selectivity on an individual's economic success. Yet, of all the institutional characteristics considered, the selectivity of the undergraduate student body at a college probably had the most consistent positive influence on a graduate's economic attainment. From this perspective, Hilmer's (1997) creative study is of some relevance. Analyzing combined data from the sophomores and seniors in the 1980 High School and Beyond study, Hilmer sought to determine if students who transferred from community colleges to four-year institutions end up at four-year institutions that are higher or lower in selectivity (operationally defined as the average combined SAT Verbal and Mathematics score for the institution's 1984 freshman class). Educational path equations were developed that estimated the selectivity of the four-year institution attended based on a student's sex, ethnicity, high school program (college preparation or other), high school geographic region, family income, high school extracurricular activities, tested ability, and number of institutions per thousand students and fees charged by institutions in the student's home state. Taking these influences into account, he predicted that a student who initially attended a community college transferred to a four-year institution that had an average student-body selectivity 32 SAT points higher that the four-year institution he or she would have attended right out of high school. In short, the results suggested that students are able to attend more selective four-year institutions if they first attend community colleges. Additional findings suggested that the predicted institutional selectivity benefit is largest for community college students who came from poor families, were of low tested ability, or performed poorly in high school. Students whose family wealth, test scores, or high school grades were more than one standard deviation below the mean transferred to four-year institutions that were up to 75 SAT points higher than they would have attended right out of high school. Conversely, high ability, high income, and high performing students lost little or nothing in terms of institutional selectivity if they decided to transfer.
Impact of Peers
Major and
Career Choice
In
our 1991 synthesis, we concluded that the most consistent college environmental
impact on career choice was that of "progressive conformity." Progressive conformity posits that, other
things being equal, a student's major field of study and career choice will be
influenced in the direction of the dominant peer groups at an institution. Our present synthesis found considerable
evidence in support of the progressive conformity hypothesis. Probably the most extensive and
methodologically rigorous research done in this area has been carried out by
scholars affiliated with the Higher Education Research Institute at UCLA (A. Astin,
1993b; A. Astin & Astin, 1993; Sax, 1994, 1996). These scholars have analyzed various
longitudinal iterations of the Cooperative Institutional Research Program data
and have typically introduced statistical controls for an extensive set of
individual-level characteristics, such as tested ability, race, sex, expected
major, high school experiences, family background, precollege career plans, and
measures of the academic and social experience of college. In the presence of such controls, there is
clear evidence that both major choice and career choice are influenced by the
distribution of student majors at the institution attended.
For
example, in their national study of the factors that influence students'
interest in studying science, mathematics, and engineering (SME) and pursuing
careers in those areas, Astin and Astin (1993) found that, even after
entering student characteristics (including initial choice of major) and other
environmental variables had been controlled, a student's final major in four
areas—biological science, physical science, engineering, and social science—was
significantly and positively influenced by the percent of undergraduate peers
at his or her institution majoring in those respective areas. Similar findings have been reported by Astin (1993b) for senior-year career
choice and by Sax (1996) for enrollment in science,
mathematics, and engineering graduate programs.
Net of other factors, including precollege career choice, Astin (1993b) found that 1) a senior's
career choice in business was positively influenced by the percentage of
business majors at the institution, 2) a senior's career choice in engineering
was positively influenced by the percent of engineering majors, 3) a senior’s
career choice as a lawyer was positively influenced by the percent of social
science majors, 4) a senior career choice to become a research scientist was
positively influenced by the percent of natural science majors, and 5) a career
choice as a school teacher was positively influenced by the percent of
education majors. Using a similar
analytic design in her study of post-college commitment to science careers, Sax
(1996) reported that enrollment in
science, mathematics, and engineering graduate programs was significantly
enhanced by attendance at an undergraduate institution where one's peers had a
strong science orientation. Peer science
orientation was operationally defined as the percent of students at an
institution initially choosing a career as a scientific researcher or college
teacher plus the average importance to peers of making a theoretical
contribution to science as a life goal.[28], [29]
Within-College Effects
Conclusions from
The
evidence is clear that certain major fields of study (e.g., business,
engineering, technical or professional) tend to have a closer fit with the skills
required in one's first job than do others (arts, humanities, and social
sciences). It is not clear, however,
that the job fit of one's major is a key determinant of job satisfaction.
We
found little evidence across studies that academic major, as typically
categorized (humanities, social sciences, natural sciences, and so on), has
more than a small and inconsistent pattern of effects on job status. This may be due to the fact that traditional
categorizations of major have only a marginal theoretical and functional fit
with the structure of occupational status.
There is some modest evidence to suggest that when academic majors are
placed on a continuum in terms of how they are "targeted" toward
occupations that stress prestige, supervisory authority, or income, they
demonstrate a stronger impact on job status.
Although
sparse, the evidence that college major independently influences the likelihood
that women will enter sex-atypical careers is convincing. Net of other factors, a sex-atypical major (one
that attracts a high percentage of men, such as business or mathematics)
enhances the likelihood of a woman entering a sex-atypical career. Thus, academic major in college may be an
important determinant of gender equality in the work force. A student's major field of study, however,
may have little to do with his or her job performance or long-term career
mobility, although in the private sector this may depend upon the employing
company. Not a great deal of evidence
pertains to these issues, but the evidence that does exist suggests that over
the long run, in business at least, liberal arts majors do as well as (though
not better than) those with a business or engineering degree.
According
to clear and consistent evidence, major field of study has a significant impact
on early career earnings that cannot be accounted for by differences in the
characteristics of students selecting different majors. The majors that enhance earnings tend to be
characterized by a relatively well-defined body of knowledge and skills, an
emphasis on scientific or quantitative methods of inquiry, and often an applied
orientation. Examples include such
majors as engineering, business, several of the physical sciences, and
preprofessional majors oriented toward medicine and dentistry. These majors tend to have close links to
occupations with relatively high average earnings. Differences in the academic field of study
chosen during college tend to explain part but not all of the lower earnings of
women and racial minorities.
Nearly
all of the studies on the influence of academic major on earnings focus on
earnings during the early career. The
evidence is less convincing that the same majors are linked with higher
earnings in the later stages of one's career.
The
evidence is consistent in suggesting that academic achievement during college
has a small but statistically significant positive impact on early occupational
status. Part of this effect may be
indirect, occurring because grades enhance educational attainment, a key
determinant of job status. Though less
extensive, there is similar evidence to suggest that college grades also
enhance the likelihood of women entering sex-atypical careers. A substantial part of this influence may also
be indirect, mediated through educational attainment.
It
was estimated that without other factors being controlled, college grades
account for no more than 2 or 3 percent of the variance in various noneconomic
indexes of job performance and career mobility.
Evidence from the most vigorously conducted study suggests that at least
part of the link with career mobility may be causal. This does not appear to be the case for the
link between college grades and job satisfaction, however, which we interpret at spurious.
The
weight of evidence from a large body of research indicates that academic
achievement during college has a positive direct impact on early career
earnings that is independent of student background characteristics, the
selectivity of the institution attended, and major field of study. Evidence with respect to a longer-term effect
is less extensive and inconsistent. Any
direct causal impact of grades on early career earnings appears small, probably
explaining no more than 1 percent of the differences in individual earnings. This might be increased by as much as
one-third if the indirect effect of grades on earnings, through educational
attainment, were also taken into account.
We
found no consistent evidence to suggest that extracurricular involvement during
college has more than a trivial, net influence on the status of one's
occupational choice, the actual occupational status of one's job, and one's
earnings. There is some limited support,
however, for the contention that social leadership involvement during college
enhances the likelihood of women entering sex-atypical careers. With the exception of individuals in
technical fields such as engineering, college graduates are consistent in
indicating that extracurricular involvement, particularly in leadership roles,
has a substantial impact on the development of interpersonal and leadership
skills important to job success. It also
appears to be positively linked with managerial potential. Objective assessments, however, indicate only
a trivial link between career mobility and both the extent of extracurricular
involvement and involvement in leadership positions during college.
There
is also little consistent evidence to suggest that intercollegiate athletic
participation has anything but a trivial and statistically nonsignificant
impact on occupational status or earnings, though it may enhance the social
mobility of individuals from low socioeconomic backgrounds.
The
existing evidence suggests that, net of other influences, working during
college, particularly in a job related to one's major or initial career
aspirations, enhances the level of professional responsibility attained early
in one's career, the likelihood of women choosing a sex-atypical career during
college, and women's plans for entering the work force subsequent to
college. However, the evidence with
respect to the influence of work during college on subsequent earnings is
inconsistent. This may be at least
partially due to the fact that the studies reviewed do not typically consider
the degree to which work during college is related to an individual's
postcollege employment.
The
magnitude of faculty impact on student career choice appears to vary with
amount of informal contact or interaction.
Net of other factors, including initial career choice, frequency of
informal contact with faculty appears to enhance women's interest in a career
as well as their choice of a sex-atypical career. Similarly, it also has a net positive
influence on orientation toward a scientific or scholarly career and, for some
students, the status of one's career choice.
Although there are some problems in the designs of the extant studies,
the weight of evidence also suggests that female faculty may be somewhat more
influential career role models for women students than are male faculty.
Evidence from the 1990s
A
substantial body of literature in the decade of the 1990s has addressed
within-college effects on dimensions of career and economic attainment. We have organized our synthesis of that
literature within the following general categories: interventions to enhance
career development, academic major, academic achievement,
extracurricular/social involvement, work during
college, and academic involvement.
Interventions to Enhance Career Development
There
is voluminous literature on the career development of college students, most of
which is either tangential to or beyond the scope of this synthesis. However, there is a modest body of literature
that estimates the impact of interventions designed to enhance students' career
development during college. This
literature is largely experimental or quasi-experimental in design, but the
nature of the interventions is not always clearly or comprehensively described. Similarly, the dependent measures employed
appear to assess a considerable range of career development dimensions. Consequently, it is somewhat difficult to
synthesize the findings.
Fortunately,
we were able to uncover at least one meta-analysis of career development
courses. Hardesty (1991) conducted a meta-analysis
of 12 studies that attempted to evaluate the effectiveness of undergraduate
career development courses that were offered for academic credit. Thus, these courses were typically at least a
semester in length and combined a range of didactic, experiential, and
counseling activities. In each of the
studies, the outcome measure assessed either career
maturity, career decidedness, or both.
Essentially, level of career maturity represents an individual's ability
to make a realistic career decision while career decidedness appears to
represent a person's level of certainty in their career choices. Across all relevant studies, students
enrolled in the career development courses demonstrated improvement in career
maturity that was between .43 and .44 of a standard deviation (17 percentile
points) greater than similar studies not exposed to the courses. For career decidedness, the improvement
advantage for students in the career development courses averaged between .34
and .36 of a standard deviation (13 to 14 percentile points).
More
recent literature would not appear to contradict Hardesty's (1991) major conclusion that
career development courses or related interventions can significantly enhance
dimensions of students' career development and maturity (e.g.,
Eveland, Conyne, & Blakney, 1998; Mau, Calvert, & Gregory, 1997; Niles
& Garis, 1990; Sullivan & Mahalik, 2000; Wei-Cheng, 1999; Zagora &
Cramer, 1994). In some of these investigations, the
intervention conditions consist of different computer-assisted or standardized
career development programs such as: Career Decision-Making, a
computer-assisted instructional program that teaches theory-based strategies
for choosing a career; the Self-Directed Search, a vocational assessment
and intervention designed to increase self-knowledge and the number of
vocational options considered; DISCOVER, a computer-assisted program
providing information about the fit between personality and potential careers;
and the System of Interactive Guidance and Information Plus, an
interactive system designed to help students clarify educational and career
plans (Mau et
al., 1997; Wei-Cheng, 1999). In other studies, the intervention is a
combination of computer-assisted interventions and career counseling or
instruction (e.g.,
Eveland et al., 1998; Niles & Garis, 1990). Still other studies employ different group
instructional/counseling workshop formats as the experimental treatment (e.g.,
Sullivan & Mahalik, 2000; Zagora & Cramer, 1994). Generally, the results of these
investigations suggest that students in the various career development
interventions (or combinations of interventions) show significantly greater
growth than students not exposed to the interventions on a range of important
career development dimensions. These
dimensions include: career decision-making efficacy, level of vocational exploration
and commitment, vocational identity, vocational construct integration, and
number of occupations considered. Not
all of the studies report requisite statistical information for computing
effect sizes. Moreover, given the
differences across studies in the interventions employed and career-development
outcomes assessed, it is not clear what an average effect size would have
represented. Consequently, we did not
estimate an effect size for this more recent body of evidence.
It is also worth briefly discussing a creative study by Luzzo and colleagues (Luzzo, 1995; Luzzo, Funk, & Strang, 1996) which suggests that attributional retraining as developed by Perry and his colleagues (Perry, Menec, & Struthers, 1996; Perry & Penner, 1990; Perry & Struthers, 1994) can increase career decision-making self-efficacy among certain kinds of students. Recall from Chapter 3 that attributional retraining is an intervention strategy designed to enhance motivation and achievement striving by changing how students think about the causes underlying their success or failure. There is evidence that attributional retraining is most effective in improving the learning of students who tend toward an external locus of attribution for success (e.g., attribute it to luck). In the experiment by Luzzo et al., students were assigned either to a control condition or to an attributional retraining intervention. In the latter, students watched a brief attributional retraining videotape in which two college graduates persuaded students to attribute career-related difficulties to a lack of effort and to attribute successful career development to adequate effort and persistence. The dependent variable was career decision-making self-efficacy, or the extent to which a person feels confident in accomplishing tasks necessary to make good career decisions. Consistent with the effects of attributional retraining on learning, the career decision-making self-efficacy of students with an external locus of control increased significantly after receiving the intervention while the career decision-making self-efficacy of students with an internal locus of control did not.
With
the possible exception of a student's academic achievement during college,
one's academic major or major field of study is the most studied of all
within-college effects on career and economic attainments. As will become clear in our synthesis,
undergraduate academic major can play a major, if not always totally
consistent, role in one's career.
Moreover, academic major has important implications for gender
equality/inequality in earnings.
Job-Related
Skills
A
small body of research has addressed the issue of whether different academic
majors have a differential impact on the development of job-related skills (Smart,
1997; Smart, Feldman, & Ethington, 1999). Smart and his colleagues analyzed
multi-institutional data from the 1986-1990 Cooperative Institutional Research
Program sample and sought to determine if
Workforce Participation
There
is little in the evidence from the 1990s to suggest that academic major has a
statistically significant net impact on women's workforce participation (Bowen
& Bok, 1998; Stoecker & Pascarella, 1991). Bowen and Bok analyzed the College and Beyond
data which followed up students about 19-20 years after entering college in
1976. Their operational definition of
major consisted of the categories of social science, natural science,
engineering, humanities, and other. With
controls for such factors as race, SAT score, high school achievement,
socioeconomic status, the selectivity of the institution attended, college
academic achievement, educational attainment, marital status, and having
children, undergraduate major had only a trivial impact on a woman's decision
to work. Similar, if not totally comparable,
results are reported by Stoecker and Pascarella in their analyses of the 1980
Cooperative Institutional Research Program follow-up of students who began
college in 1971. Their operational
definition of academic major was the percent of men in each respective field of
study nationally in 1976. Net of such
influences as socioeconomic status, secondary school academic and social
accomplishment, precollege educational and occupational aspirations; measures
of institutional selectivity, size, and gender distribution; college academic
achievement, marital status, and educational attainment, being in a
sex-atypical or male-dominated major had a statistically nonsignificant impact
on full-time labor force participation.
One
possible reason why academic major had no significant impact on workforce
participation in the Bowen and Bok (1998) and the Stoecker and
Pascarella (1991) studies is that there was
simply too great a period of time between the undergraduate experience and the
follow up—about 15 years for Bowen and Bok and about 5 years for Stoecker and
Pascarella. It may simply be that the
impact of academic major on workforce participation is manifest early in an
individual's career (e.g.,
Steinberg, 1994). Some indirect evidence for this possibility
is suggested in studies by Bellas (1998) and Sagen, Dallam, and
Laverty (1997). Bellas analyzed data from the first year
follow-up of the 1993 Baccalaureate and Beyond Longitudinal Study and sought to
predict the number of job interviews and job offers received. Statistical controls were introduced for such
factors as age, sex, race, marital status, institutional type, college grades,
educational attainment, and work experience.
In the presence of these controls, business/management and engineering
majors received, on average, the most job interviews while
mathematics/computer/physical science majors and social science majors received
the second most. Net of the same
controls, plus number of job interviews received, majors in business/management
and health professions received the most job offers while engineers actually
received the least. The rather
counterintuitive nature of the latter finding, given the demand for engineers,
may be explained by the fact that engineering majors received lucrative offers
early in their job search. Thus, they
may conclude their job search before some job interviews culminate in job
offers (Bellas,
1998).
Sagen,
Dallam, and Laverty (1997) take a somewhat different
approach and attempt to predict success in securing employment appropriate to
the bachelor's degree within two months following graduation from a large,
Midwestern, research university.
Employment appropriate to a bachelor's degree was determined by
educational level in the Dictionary of Occupational Titles. Major was operationally defined in terms of
four categories: specialized-hard (e.g., engineering, computer science),
specialized-soft (e.g., nursing, social work, education),
broad professional (e.g., journalism and business), and general liberal arts
(e.g., English, humanities). Statistical
controls were introduced for such potentially confounding influences as: ACT
composite score, college grades, gender, work experience, coursework, volunteer
activities, having a mentor as an undergraduate, and participation in student
organizations. In the presence of such
controls, one's academic major significantly influenced the likelihood of
appropriate employment. Compared to
general liberal arts majors, students in either the specialized-hard or
specialized-soft majors were significantly more likely to have secured
employment appropriate to a bachelor's degree.
Students in broad professional majors were also advantaged in securing
appropriate employment over general liberal arts majors, but the advantage was
not statistically significant.
The findings of the Bellas (1998) and Sagen, Dallam, and Laverty (1997) studies are not totally consistent, in part perhaps because they address somewhat different outcomes. The evidence they provide, however, does suggest that one's major can have a significant net impact on getting a job and securing employment at a level appropriate to a bachelor's degree early in one's career. The clearest advantage in these areas would appear to accrue to students majoring in fields that have the most direct functional linkages with specific jobs or occupational sectors (e.g., computer science, engineering, social work, nursing, and perhaps some specific business fields such as accounting).
Occupational
Status
Unlike
the conclusion from our 1991 synthesis, we found evidence in the research of
the 1990s to suggest that academic field of study did have a significant, net
impact on an individual's subsequent occupational status (Dey et
al., 1998; Knox et al., 1993; Stoecker & Pascarella, 1991). In all of these studies, occupational status
was operationally defined with the Socio-Economic Index (SEI). Dey et al. analyzed data from the 1974-75 and
the 1992-93 follow-ups of the 1957 Wisconsin Longitudinal Study. With statistical controls for such influences
as gender, socioeconomic status, academic ability, high school rank, the
characteristics of the undergraduate institution attended, and educational
degree attainment, students with undergraduate majors in engineering, the
health-related fields (e.g., pre-medical, pre-dental, pharmacy, nursing), and
mathematics/science tended to be in jobs in the 1974-75 follow-up that had the
highest occupational status. Even when
1974-75 occupational status was added to the prediction equation, undergraduate
majors in engineering and health-related fields continued to hold jobs with the
highest occupational status in 1992-93.
With
the exception of such fields as nursing, the findings of Dey et al. (1998) suggest that students
majoring in fields of study that have been traditionally dominated by men
[e.g., engineering, mathematics, physical science, and technical
pre-professional fields such as pharmacy, pre-medicine, and pre-dentistry; see,
for example, Jacobs, (1995;
1996a); Nelson
& Dixon, (1997); Turner & Bowen, (1999)] tend to be overrepresented
in high status occupations. Some
generally corroborating evidence for this finding is reported by Stoecker and
Pascarella (1991) in their analyses of the
1971-80 Cooperative Institutional Research Program data and by Knox, Lindsay,
and Kolb (1993) who analyzed the 1986
follow-up of the National Longitudinal Study of the High School Class of
1972. Recall that Stoecker and
Pascarella operationally defined major as a continuous variable reflecting the
percent of men in each respective field of study nationally in 1976. Net of controls for such factors as
precollege demographic characteristics, educational and occupational
aspirations, characteristics of the undergraduate institution attended, college
grades, and educational attainment, the percent of men in a woman's major field
of study had a modest, but statistically significant positive effect on the
occupational status of the job she held in 1980. Similarly, Knox, Lindsay, and Kolb (1993) found that majoring in
education or the liberal arts and sciences had a significant negative effect on
the occupational status of one's job relative to majoring in engineering,
technical, and professional fields. This
negative effect persisted even in the presence of statistical controls for
academic ability, race, gender, socioeconomic status, the characteristics of
the institution attended, college grades, place of residence, and educational
attainment.
Career
Mobility and Success
In
our 1991 synthesis, we concluded, albeit cautiously, that a student's major
field of study as an undergraduate may have little to do with his or her
long-term career mobility in business.
We also pointed out, however, that in the private sector this may well
depend on the employing company.
Although not particularly consistent across studies, the results of a
very small body of research in the 1990s at least challenge our previous
conclusion (Ishida et
al., 1997; L. Solnick, 1990; Spilerman & Lunde, 1991). Spilerman and his colleagues conducted two
studies of the factors that influenced job promotion prospects in a single
large insurance company. In the first of
these, Spilerman and Lunde (1991) sought to account for
promotion within six salary grade intervals and introduced statistical controls
for years of education, gender, age, race, and seniority. In the presence of these controls, employees
who were mathematics/science/engineering majors as undergraduates had
significantly higher rates of promotion in the middle organizational ranks of
the organization than did employees who majored in the humanities or social
services. At the highest organizational
ranks of the company below vice president, both business/insurance majors and
mathematics/science/engineering majors were significantly more likely to be
promoted than were humanities or social sciences majors.
Somewhat
different findings are presented by Ishida, Spilerman, and Su (1997) in a further analysis of
the same data. This difference is probably
due to the fact that they operationally defined promotion, not within salary
grade intervals, but rather in terms of three major transitions: from clerical
to administrative, from administrative to senior management, and from senior
management to vice presidential grade.
They also operationally defined major with a different set of
categories. With controls for level of
formal education, age, race, sex, seniority, and institutional selectivity,
undergraduate social science and economics majors were significantly more
likely than humanities majors to be promoted from administrative to senior
management ranks. The probability of
promotion from administrative to senior management ranks for both business and
science/mathematics majors was not significantly higher than that of humanities
majors. College major had no significant
net impact either on the probability of promotion from clerical to
administrative ranks or from senior management to vice presidential rank.
The
waters are muddied still further by Solnick's (1990) study of the job success of
370 African-American college graduates employed by a large manufacturing
firm. With controls for such factors as
sex, marital status, college grades, timing of bachelor's degree, prior
experience, salary grade, and the characteristics of the institution attended,
undergraduate major (engineering, science, business or other) had no
significant impact on the probability of being promoted within two years after
being hired. However, business majors
were advantaged in terms of percentage increases in wages over time.
It
is difficult to form a conclusion about this body of evidence, except to say
that, net of other factors, undergraduate college major can play a significant
role in some aspects or levels of career mobility and success. It would appear, however, that the nature and
magnitude of this impact depends upon the type of company or firm being
considered and its unique cultural norms and values, the particular period of
time in one's career, the sector of the company in which individuals with
certain undergraduate majors tend to be placed, and the level of promotion or
advancement being considered. As in our
previous synthesis, we found little evidence to suggest that undergraduate
field of study plays a significant role in promotion to the very highest levels
of corporate management or leadership (i.e., vice president or above).
Job
Satisfaction
We
uncovered two studies in the literature of the 1990s which estimated the impact
of academic major on job satisfaction (Bowen
& Bok, 1998; Fricko & Beehr, 1992). These studies take a very different approach
to defining the relationship between academic major and job satisfaction. Analyzing the 1995 follow-up of the 1976
entering cohort from the College and Beyond data, Bowen and Bok (1998) sought to determine the
factors that predicted the likelihood of being "very satisfied" with
their job. Statistical controls were
introduced for an extensive array of potentially confounding influences such as
race, gender, SAT score, high school rank in class, socioeconomic status, the
selectivity of the institution attended, college academic achievement,
educational attainment, income, the labor market sector of employment (e.g.,
profit, nonprofit, self-employed), and marital status. In the presence of these controls, one's
undergraduate academic major (categorized as social science, natural science,
engineering, humanities, and other) had only a trivial and statistically
nonsignificant impact on being "very satisfied" with one's job.
Given
the extended time period over which the Bowen and Bok (1998) study followed the 1976
entering cohort and the potential for extensive intervening influences, it is
not particularly surprising that one's undergraduate academic major exhibited
little impact on job satisfaction. In
contrast, Fricko and Beehr (1992) followed up a sample of
alumni from a single university who had been out of college for less than five
years and had been in their present jobs for between one and two years. Moreover, instead of assessing the simple net
relationship between academic major and job satisfaction, they were interested
in how job satisfaction is influenced by the congruence between one's
academic major and one's job. Major-job
congruence was measured in two ways. The
first was perceived congruence which was based on responses to the item:
"My job is in the same field as my college major," answered on a
7-point scale ranging from "strongly agree" to "strongly
disagree." The second was objective
congruence which was based on the degree of match between the person's official
major defined in
In
our 1991 synthesis, we concluded that it was not clear that job fit with one's
major was an important determinant of job satisfaction. Although it is based on a single institution
sample and, as far as we know, awaits replication, Fricko and Beehr's (1992) findings suggest that we
need to modify our earlier conclusion.
Earnings
By
far, the greatest volume of research on academic major and career attainment
focuses on the impact of one’s major field of study on subsequent
earnings. In our present synthesis, we
review evidence from 23 individual published and unpublished studies that
appeared between 1989 and 2000. These
investigations analyzed data from numerous data sets. The specific data sets and the studies that
employ them were as follows:
1. The National Longitudinal Study of the High
School Class of 1972-1979 and 1986 follow-ups (Arcidiacono,
1998; Grubb, 1995a, b, 1998, August; James & Alsalam, 1993; James et al.,
1989; Knox et al., 1993; Loury, 1997; Loury & Garman, 1995; Rothstein,
1995; Sweetman, 1994a, 1994b).
2. The High School and Beyond 1980 cohort
followed up in 1986 (Fox, 1993;
Hilmer, 2000), and in
1991 (Fitzgerald,
2000).
3. The Baccalaureate and Beyond Study of
1992-1993 graduates followed up one year later (S Thomas,
1998) and four
years later (S. Thomas,
2000).
4. The College and Beyond 1976 cohort followed
up in 1995 (Bowen
& Bok, 1998).
5. The National Center for Education Statistics
Surveys of Recent College Graduates: 1985-86 graduates followed up in 1987 (Rumberger
& Thomas, 1993); 1989-90
graduates followed up in 1993 (Tsapogas
et al., 1994).
6. The National Science Foundation New Entrants
Survey of 1992 graduates followed up in 1993 (Tsapogas
et al., 1994).
7. The Cooperative Institutional Research
Program data: 1971 freshmen followed up in 1980 (Stoecker
& Pascarella, 1991).
8. The 1987 and 1990 cohorts of individuals
25-64 years of age from the cross-sectional Survey of Income and Program
Participation (Grubb,
1995b, 1997, 1998, August).
9. The 1993 follow-up of graduates of the class
of 1982 at 20 prestigious colleges and universities (Dowd,
1999).
10. A sample of African-American employees of a
large manufacturing firm who were hired between 1976 and 1982 (L.
Solnick, 1990).
11. Two single-institution samples of graduates
which estimate starting salary and subsequent salary (Dutt,
1997).
Drawing
conclusions from this body of evidence is complicated by several factors. First, as might be anticipated, the studies
use very idiosyncratic methods for operationally defining undergraduate field
of study. Most use categorical (dummy)
variables to indicate different majors (e.g., physical sciences, social
sciences, mathematics, humanities, education, and the like). However, there is only partial consistency in
how major is categorized across studies.
Some studies, such as Stoecker and Pascarella (1991), do not even use categories
or clusters to define academic field of study, but rather consider it a
continuous variable defined by the percent of men in each specific major. Second, the studies vary substantially in
terms of the period of time over which individuals are followed in their
careers. Some studies are concerned with
the impact of academic major on starting salary or earnings early in one’s
career, while others follow up with individuals ten, or even fifteen, years
after college graduation.
Cross-sectional data, such as that from the Survey of Income and Program
Participation actually includes information on full-time employees in nearly
all age groups. Finally, the
investigations vary to a substantial degree in terms of the statistical
controls they are able to introduce for potentially confounding influences. The typical study, however, introduces
controls for such confounding influences as sex, race, socioeconomic
background, tested academic ability, precollege aspirations, the selectivity
and other characteristics of the undergraduate institution attended, college
grades, educational attainment, and measures of work or labor market
experience.
Despite
these complications, it is still possible to offer the following
generalizations from this body of evidence.
First, consistent with our 1991 conclusions it would appear that
undergraduate major field of study has a substantial and statistically
significant net impact on earnings that cannot be accounted for by other
influences, including the background characteristics of students selecting
different majors. With other factors
controlled, there is typically between a 25 to 35% difference in the earnings
of individuals who were in different fields of study as undergraduates. Also consistent with our previous synthesis,
the largest earnings premia accrue to majors characterized by a number of
traits. These include a relatively
specific and well-defined body of content knowledge and skills, an emphasis on
methods of inquiry that require a high level of quantitative and/or scientific
skills, a generally close and direct functional link to occupations with
relatively high average earnings, in many cases an applied orientation, and a
history of being dominated by male students.
Examples of such majors are engineering, business/accounting, several of
the physical sciences, mathematics and computer science, and preprofessional
majors in health sciences areas such as medicine and dentistry.[30],[31] This general conclusion does not appear to be
seriously affected by differences in the methodological rigor of the studies we
reviewed. Moreover, while the net effect
of academic major on earnings appears to be most definitive or pronounced in
terms of starting salary or early in one’s career, the general pattern of
economic returns to different majors appears to hold later in one’s career.
Second,
there may be an exception to this general pattern for students attending
particularly selective, prestigious institutions. For example, Dowd (1999) analyzed data from the 1993
follow up of 1982 graduates of 20 of the nation’s most selective colleges and
universities. Statistical controls were
introduced for ethnicity, region of the country where one held a job, marital
status, number of children, and the selectivity of the institution attended. In the presence of these controls, female
graduates from history and political science departments earned about as much
as did female graduates of mathematics and physical science departments. Male history and political science majors
actually earned somewhat more than their counterparts with mathematics or physical
sciences majors. Dowd concludes, along
with Eide and Waehrer (1998), that in elite institutions
liberal arts disciplines may provide the “option value” of potential graduate
or professional study. This functions to
enhance longer-term earnings and alter the more typical or representative
pattern of major field effects on the economic returns to college. Bowen and Bok’s (1998) analyses of the College and
Beyond sample yielded results for both women and men, but particularly the
latter, that are generally consistent with those of Dowd. The College and Beyond sample they analyzed
consisted of a 1995 follow up of individuals who in 1976 enrolled in 28 of the
country’s most selective private and public institutions.
Third,
while the vast majority of studies focus on the economic returns to different
college majors at the baccalaureate level, there is also a small body of
research that estimates the returns to different fields of study at the
sub-baccalaureate level. Most of the
evidence is provided by the work of Grubb (1995b;
1997; 1998, August). Analyzing data from two national data sets
(the 1986 follow up of the National Longitudinal Study of the High School Class
of 1972 and the 1987 and 1990 cohorts of the Survey of Income and Program
Participation), Grubb found that, net of other factors, there were substantial
differences in the earnings of individuals with certificates or associate’s
degrees in different areas of study.
Generally, for men the economic returns were highest for majors in
technical fields (e.g., engineering/computers) and business, while the highest
returns accrued to women with majors in business and health. Unlike the general trend for a bachelor’s
degree, however, obtaining an associate’s degree or certificate in some fields
of study, such as education, the humanities, and the social sciences for men,
often provided little consistent advantage in earnings over a high school
diploma. Conversely, it is clear from
Grubb’s extensive analyses that returns to associate’s degrees and to
bachelor’s degrees overlap—largely due to an individual’s field of study. For example, men can generally realize a
larger economic premium by obtaining an associate’s degree in engineering,
public service, or vocational/technical areas than they can from a bachelor’s
degree in the humanities or education.
Similarly, women can generally get a greater earnings return from an
associate’s degree in business or health than from a bachelor’s degree in the
humanities or education.
Fourth,
a small, but consistent, body of evidence suggests that earnings are enhanced
by the extent to which one’s undergraduate major is related to, or congruent
with, his or her job. This finding
generally holds at both the baccalaureate and sub-baccalaureate level. For example, analyzing data from the 1990
cohort of the Survey of Income and Program Participation, Grubb (1997) developed a categorical
matching algorithm that links fields of study with Census occupational
codes. He then regressed
1990 earnings on years of formal education completed, plus the matching
algorithm indicating if an individual’s major was or was not related to his or
her employment. At the bachelor’s degree
level, men in related employment had about a 17% advantage in earnings over men
in unrelated employment. (Here, and in
all subsequent estimates, we took the natural antilog, minus one, of the
coefficients reported by Grubb and divided the larger by the smaller.) The corresponding advantage for women in related
employment was about 43%. At the
associate’s degree level, men in jobs related to their major had about a 15%
advantage over men in unrelated employment, while the advantage for women was
about 50%. At the sub-baccalaureate
certificate level, men in related employment demonstrated no earnings advantage
over men in unrelated employment; but women in related employment had about a
29% advantage. Consistent findings are
reported in analyses of three national samples by Kolb (1989) and Tsapogas, Cahalan, and
Stowe (1994) and in analyses of single
institution samples by Callaway, Fuller, and Schoenberger (1996), Dutt (1997), and Fuller and
Schoenberger (1991). The findings hold,
irrespective of whether the study employs an objective or self-reported
(perceptual) measure of major-job congruence or whether the study is predicting
starting salary or earnings about five or more years into one’s career. As we
pointed out earlier in this chapter, however, part of this finding may be due
to the fact that the majors most likely to lead to related employment (e.g.,
engineering, business, health) are also linked to the highest earnings. Thus,
the causal mechanism underlying this finding may be somewhat difficult to
ascertain.
Gender
Differences in Earnings
It
is clear that one’s undergraduate academic field of study plays a substantial
role in determining one’s earnings, particularly in the early stages of one’s
career. It is also clear, from a
substantial body of evidence, that there have traditionally been pronounced
differences in the pattern of majors populated by men and women (Adelman,
1990, 1991, June, 1998a; Alsalam & Rogers, 1991; Davies & Guppy, 1997;
Dowd, 1999; Dutt, 1997; Jacobs, 1996b; Loury, 1997; National Center for Education
Statistics, 1997; Nelson & Dixon, 1997; O'Shea, 1989; Sumner & Brown,
1996). Generally, men tend to be overly represented
in fields of study that are closely linked to the highest paying
occupations. These lucrative fields of
study include engineering, business, economics, mathematics/statistics, the
physical sciences, and the like. Women,
on the other hand, tend to be overrepresented in fields of study that are
linked to lower-paying occupations.
These nonlucrative fields of study include the social sciences,
humanities, nursing, education, English, journalism, and the like. Moreover, women are more likely than men to
enter nonlucrative fields of study even after such influences as family
structure, home environment, age, ethnicity, socioeconomic background, tested
ability, and high school curricular track are taken into account (Davies
& Guppy, 1997).[32]
Although it is not unanimous (e.g., Turner & Bowen, 1999), the general view is that this gender segregation in major fields of study has been slowly diminishing in the last three decades (Adelman, 1998; Blau, Ferber, & Winkler, 1998; Eide, 1994; Jacobs, 1995, 1996b). In turn, there is evidence suggesting that gradual convergence in the gender distribution across major fields of study may explain at least part of the decline in the earnings differential between college-educated men and women during the same period of time (e.g., Blau et al., 1998; Eide, 1994; Light & Ureta, 1990; Loury, 1997). It is problematic, however, that parity in the distribution of men and women in academic fields of study would totally eliminate gender differences in earnings. Despite some exceptions (e.g., Paglin & Rufolo, 1990), the weight of evidence is clear in indicating that differences in academic field of study chosen by men and women during college account for part, but not all, of the gender gap in earnings. When undergraduate academic major is taken into account, the difference in earnings attributable to gender typically becomes smaller (e.g., Sweetman, 1994a, 1994b; S Thomas, 1998; S. Thomas, 2000), but it continues to be statistically significant and often substantial (Arcidiacono, 1998; Callaway et al., 1996; Fox, 1993; Fuller & Schoenberger, 1991; Knox et al., 1993; Rumberger & Thomas, 1993; L. Solnick, 1990; Sweetman, 1994a, 1994b; S Thomas, 1998; S. Thomas, 2000; Tsapogas et al., 1994). This evidence is consistent with the conclusions from our 1991 synthesis.
Academic Achievement
In
their discussion of the validity and fairness of alternatives to standardized
cognitive tests in employment settings, Reilly and Warech (1993) argue that for employers
academic achievement (hereafter grades) is a convenient, quantitative summary
of a prospective employee’s college performance. Employers, they assert, believe that grades
measure motivation or conscientiousness, as well as cognitive ability. As such, grades provide a reasonably useful
predictor of training success, in most types of jobs, and of actual job
performance—particularly in technical fields such as accounting or engineering (Reilly
& Warech, 1993). Indeed, the evidence from research on
individual differences suggests that the personal characteristics of cognitive
ability and conscientiousness play a major role in career success (Roth &
Clarke, 1998; Schmidt, Ones, & Hunter, 1992). As suggested by Roth and Clarke (1998), substantial correlational
evidence links college grades with cognitive ability while other evidence links
grades with measures of conscientiousness (e.g., Roth
& Clarke, 1998; Schmitt, Ryan, Stierwalt, & Powell, 1995; Wolfe &
Johnson, 1995). Consequently, it is not particularly
surprising that the impact of grades on various dimensions of career and
economic success has continued to be a major focus of scholars in the decade of
the 1990s. We synthesize this evidence
within the following categories:
workforce participation, the link between grades and adult success,
occupational status, and earnings.
Workforce
Participation
The
evidence on college grades and workforce participation is mixed. There appears to be little support for the
hypothesis that, net of other factors, grades directly influence the long-term
likelihood that women will be in the workforce.
For example, when statistical controls were introduced for such factors
as precollege educational and occupational aspirations, high school grades,
socioeconomic status, institutional selectivity and size, marital status,
college major, and educational attainment, Stoecker and Pascarella (1991) found that college grades
had no significant effect on women’s likelihood of being full-time in the workforce
about nine years after entering college.
Using the same general analytic design, Bowen and Bok (1998) reported similar
results. College grades did not
significantly influence a woman’s decision to work when measured about 19 years
after entering college.
Of
course, the fact that the Stoecker and Pascarella (1991) and Bowen and Bok (1998) studies considered
workforce participation substantially after students entered, and presumably
graduated, from college may in part explain the fact that college grades had
only a trivial and statistically nonsignificant impact. Studies that consider
workforce participation within one or two years after obtaining a bachelor’s
degree report different results.
For example, in analyses of two respective single institution samples
that followed up alumni during the first year after graduation, Grayson (1997) and Sagen, Dallam, and
Laverty (1997) introduced statistical
controls for important student background characteristics and abilities. In the presence of these controls, college
grades significantly and positively influenced the odds of being employed
full-time (Grayson,
1997) and being
employed in a job appropriate to a bachelor’s degree (Sagen et
al., 1997). Another single-institution study of recent
graduates conducted by Williams and Ball (1993) reports findings consistent
with those of Grayson (1997), although it is not clear
that controls were in effect for potential confounding influences.
The Link Between College Grades and Occupational Success
One
approach to studying the impact of college grades on career and economic
success has simply been to estimate the strength of the association between
cumulative undergraduate grades and various measures of success in the
workplace. There is no shortage of
studies on this topic. Fortunately, since 1989 there have been a number of quantitative
syntheses (or meta-analyses) of this evidence. Bretz (1989), synthesizing 39 studies,
Dye and Reck (1989), synthesizing 72 studies,
and Roth, BeVier, Switzer, and Schippman (1996), synthesizing 49 studies,
have all estimated the link between undergraduate grades and various measures
of job success. The measures of job
success included supervisor’s ratings of job performance, measures of
output/productivity, salary, training success, and the like. Weighting the overall findings of each
meta-analysis by the number of studies reviewed, we estimate that the average
correlation between cumulative undergraduate grades and job success/performance
was about .16. In other words, across
all studies undergraduate grades accounted for about 2.6% of the variance in
job success (i.e., .162).
Overall, this is not a particularly strong association. However, grades are a better predictor of
performance as the links between education and jobs get closer. Examples would include such fields as
business and engineering. Moreover,
Roth, BeVier, Switzer, and Schippman (1996) also found that when the
simple correlation between grades and job success was corrected for such
factors as the reliability and range restriction of grades and job performance
measures, the size of the correlation increased to between .23 and .36.
More
recently, Roth and Clarke (1998) conducted a meta-analysis
of 75 studies focusing on the relationship between undergraduate grades and
earnings or salary. They found a simple
correlation of .14 between grades and starting salary, which rose to .22 when
the correlation was corrected for range restriction and the unreliability of
grades. College grades had a simple
correlation of .17 with currently salary, which rose to .26 when the
correlation was corrected for range restriction and the unreliability of
grades. The correlation between grades
and salary growth was negligible. Using
the correlations derived by Roth and Clarke from their meta-analysis, one would
conclude that undergraduate college grades are associated with between 2 and
4.8% of the variance in starting salary (i.e., .142 and .222)
and 2.9 and 6.8% of the variance in current salary. The lower estimates are quite consistent with
the conclusions from our previous synthesis.
The higher estimates are somewhat larger than our 1991 estimates, but
that is probably due to the corrections for restricted range and unreliability
of grades included in Roth and Clarke’s work.
It
is also worth noting that, consistent with the meta-analysis results concerning
grades and job success, Roth and Clarke (1998) also found that in fields
where there was a stronger connection between education and job skills the
correlation between grades and salary was larger. For example, in engineering the correlations
were in the .35 to .45 range.
Of
course, there is a significant problem with this body of evidence. Namely, the simple correlation between
college grades and various measures of job performance and success is likely
confounded by other factors. Thus, only
part of the association may be causal.
Another body of research has attempted to estimate the actual net or
causal impact of college grades, career, and economic success. We turn now to a summary of that evidence.
Job
Satisfaction and Job Mobility
As with our previous synthesis, we found little evidence to suggest that undergraduate grades are causally linked with job satisfaction. Both Bretz (1989), analyzing a single institution sample, and Bowen and Bok