Although campus life has been dramatically altered in the US, many young Americans are looking to higher education to secure a stable living in the midst of projected economic downturn. That entire process starts with the selection of a college major.
Even with the welcomed updates to the Free Application for Federal Student Aid—this week, news broke that FAFSA will be simplified and more inclusive for families of various incomes and household sizes—financial experts still warn against deciding upon a major impulsively.
“According to numerous accounts, the Great Recession has left many recent college graduates struggling to find jobs that utilize their education,” the agency wrote. “Many students are reconsidering their decision to go to college in the fall due to the coronavirus pandemic. Indeed, college enrollment is expected to be down sharply as a growing number of would-be college students consider taking a gap year.
Despite rising costs, we have shown that college has remained a good investment, at least for most people, when we weigh the costs against the benefits during normal times. The economic benefit of college is the college wage premium—the extra wages one can expect to earn with a college degree compared to having only a high school diploma, summed up over an entire working career.”
Below are the top 5 majors according to Stacker’s new report.
Median wage early career: $40,000
– Median wage mid-career: $80,000
– Unemployment rate: 1.8%
– Underemployment rate: 35%
4. Chemical engineering
Median wage early career: $68,000
– Median wage mid-career: $110,000 ($42,000 increase in wages)
– Unemployment rate: 3.8%
– Underemployment rate: 22.7%
3. Computer engineering
Median wage early career: $66,000
– Median wage mid-career: $109,000 ($43,000 increase in wages)
– Unemployment rate: 2.5%
– Underemployment rate: 21.3%
Median wage early career: $49,000
– Median wage mid-career: $95,000 ($46,000 increase in wages)
– Unemployment rate: 7.7%
– Underemployment rate: 34.3%
Median wage early career: $40,000
– Median wage mid-career: $105,000 ($65,000 increase in wages)
– Unemployment rate: 2%
– Underemployment rate: 25.6%
A sizeable portion of Americans is taking costly gap years due to restrictions placed on the traditional college experience.
Though understandable, the Federal Reserve Bank of New York has shown that unemployment is dramatically lower among recent college earners, which may be why a mass return to college is occurring across the country in the near future.
“Before the pandemic, during more normal times, we estimate the return to college at about 14 percent, easily surpassing the threshold for a good investment. Importantly, we can’t rule out the possibility that some of what we estimate as the return to college is not a consequence of the knowledge and skills acquired while in school, but rather is a reflection of the innate skills and abilities possessed by those who complete college. the Federal Reserve Bank of New York. continued.
“Health and safety are important considerations that our analysis does not take into account. In addition, if college is mostly online next year, the quality of instruction may be impacted and students might not build the skills they would with in-person classes. Moreover, recent research suggests at least some of the payoff to college comes from the network that is developed through personal relationships while in school, which could be damaged with extensive remote instruction.”