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Criticizing Return-on-Investment Approach to Degrees in PA

A version of this post appears in the APSCUF-KU May 2016 Newsletter.

Earlier this year, Pennsylvania’s System of Higher Education (PASSHE) issued a press release on a report entitled Degrees of Value. This report from Georgetown University’s Center on Education and the Workforce will become part of the State System’s “Program Alignment Toolkit.” Looking at undergraduate degrees and income, the report essentially takes a return-on-investment (ROI) approach to college degrees. In PASSHE’s press release, it noted that: “While college-educated employees in any field tend to earn more than those with only a high school education, the college majors that lead to the highest earnings are in STEM, health and business. For example, a major in architecture and engineering, the highest-paying area of STEM, led to average earnings of $82,500 in Pennsylvania.”

The ROI approach to undergraduate programs is highly problematic and often criticized. Not only are there problems with its logic, it is typically used as an attack on the arts and humanities. APSCUF, the union representing faculty in the PASSHE system, has issued its statement on the report. However, I would like to offer my thoughts on the report. I do not find the results of the report particularly surprising. What is disconcerting is that the document lacks nuance even when using a ROI rationale and the report’s own data.

Take for example the state average for students who majored in the humanities and liberal arts. Median earnings for a humanities and liberal arts major between the ages of 12-64 is $45,300 statewide. However, a humanities and liberal arts major in the Southeast region of the state makes $49,900, which is more than a biology and life science major living in the Northwest region of the state ($46,400) and pretty close to a biology major in the Southwest region ($51,000).

 

 Biology & Life Science Humanities & Liberal Arts
Central Region

$58,500

$44,100
Northeast Region

56,800

40,000
Northwest Region

46,400

36,100
Southeast Region

67,300

49,900

Southwest Region

 51,000

41,200

Statewide

 59,700

45,300
Source: Degrees of Value, Figure 14, pages 23-24

The Degrees of Value report only briefly discusses geographic differences. However, it only does so within majors. This is because using income as a benchmark is complicated by significant regional differences in jobs, cost of living, and economic resources. Yet, the report’s focus is solely on income.

PASSHE’s acceptance of the report reinforces faculty fears of a vocational-drive by campus administrators and state leaders. Yet, the data within the report does not support a vocational-drive based on ROI. Students majoring in the social sciences make more than those in fields such as agriculture and natural resources, education, law & public policy, journalism, industrial arts, and social work.

Major Median earnings by undergraduate major group ages 21-64
Social Sciences $52,800
Agriculture & natural resources 50,800
Education 47,800
Law & public policy 46,700
Communications & journalism 43,400
Industrial arts, consumer services & recreation 42,100
Psychology & social work 42,100
Source: Degrees of Value, Figure 12, page 20

In addition to the report’s focus on STEM-H, business majors are a focus. Yet, social science majors in the Southeast Region do better than many business majors across the state.

 

Business

Social Sciences (excluding psychology and social work)
Central Region

$55,900

$49,500
Northeast Region

50,500

42,100
Northwest Region

46,300

42,900
Southeast Region

67,300

60,500
Southwest Region

55,000

47,100
Statewide

58,900

52,800
Source: Degrees of Value, Figure 14, pages 23-24

It is also important to note that nationally, the gap between humanities & social science, and professional & pre-professional fields closes significantly over the course of a worker’s career.

Source: Chronicle of Higher Education, AAUP.

In conclusion, the equating of undergraduate degree with income is simplistic. It ignores economic geography, labor market dimensions, as well less quantifiable benefits such as career satisfaction, community service, and job security.

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A Long-Historical Approach to Deindustrialization in Reading Pennsylvania: First-mover cities, environment, and Urban Restructuring

mining

In September of 2011, The New York Times reported that Reading, Pennsylvania had edged out Flint, Michigan as having the largest poverty rate amongst cities with over 65,000 residents. The article presents a fairly straightforward picture of a city that had fallen upon hard times, as job loss and lack of education allowed it to slip from the 32nd poorest city in 2000 to the poorest city in 2010 according to the U.S. Census (Tavernise 2011). This article is not surprising. In fact, stories depicting the struggles of America’s Rust Belt have been common since the 1980s. Downsizing, outsourcing and factory closures were (and still are) concepts that have framed popular political and economic discourse, as well as research on deindustrialization (Bluestone and Harrison 1982; Negrey and Zickel 1994). The article, however, like much of the literature on Rust Belt cities neglect a more long-term environmental component of urban decline. By environment, I am referring the built/physical aspect, as well as the natural/ecological dimension. Specifically, explanations for deindustrialization that emphasize aggressive corporate policies to maximize profit, or the outcome of globalization are missing 1) the role of natural resources and 2) the role of infrastructure in the built environment. This environmental dimension not only explains the shape of local decline, but helps us to understand the obstacles that affect renewal.

A version was presented at the Urban Affairs Association on Apr 6, 2013 in San Francisco, CA and the American Sociological Association Annual Meeting on August 13,2013 in New York, NY.