Thursday, November 19, 2009

Economics: So They Are Disappearing

TORONTO, ONTARIO - Longtime readers of this blog may remember an entry I did earlier this year in which I noted that I saw few of my peers educated in science and engineering actually working in the field, and questioned why anyone would. Well, researchers at the John J. Heldrich Center for Workforce Development at Rutgers University have collected the data that back up my anecdotal experience.

In a report released last late month, Professor Harold Salzman of Rutgers and B. Lindsay Lowell of Georgetown were intending to research whether United States educational institutions were actually producing the Science, Technology, Engineering and Mathematics (STEM) graduates at an adequate rate, which many have been questioning. They did not find a drop in the number of people studying STEM, but to their credit they did find and note another phenomenon--the top quintile of students was substantially abandoning STEM careers for finance and other, more lucrative careers--exactly the phenomenon I described in my undergraduate class, except in that case, it extended through the top three quartiles of a small class.

Yet, the researchers didn't seem to emphasize what strikes me as most significant finding in their report. Burying this in their section on the top quintile, they state, "All quintiles shared in an across-the-board decline from the 1993/96 to the 1997/00 cohorts" in taking a first job that was in the STEM area after graduating with a STEM degree. In other words, students in the late 1990's quit going to work in STEM roles--and the data indicate the decrease was nearly a factor of two in the case of the top quintile, statistically significant but lower in magnitude across the board.

In its conclusion, the report states, "Highly qualified students may be choosing a non-STEM job because these other occupations are higher paying, offer better career prospects such as advancement, employment stability, and/or prestige, as well as less susceptible to offshoring." This is exactly what I have personally been observing; I couldn't have summarized it better.

At one point in graduate school, I remember having a conversation with a chemical engineering colleague who had just talked to a graduate that had been working in investment banking for about a year, and had just gotten a raise in salary to something in six figures before bonuses (I don't remember the exact amount). He was clearly excited. "That's a lot of money," he said. Sure enough, that's the career path he chose--leaving chemical engineering along with the majority of our peers.

Frankly, I don't see STEM careers becoming any more attractive or lucrative, so my guess is that STEM retention will stay low for the foreseeable future.

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