Degrees of freedom

23 June 2017 | news

What do Finance Ministers Bill English and Michael Cullen have in common? Both have post-graduate Arts degrees. MPs enjoyed lively debate at a recent Select Committee meeting on the use of variable subsidies as a blunt instrument to manipulate student numbers in different subjects. Should you pay for a degree with higher returns? Should government limit subsidies to degrees perceived to have lower economic returns? A new-US study confirms that prospective students (and governments) should avoid making assumptions about future career paths. Here’s why.

Does it matter what degree you study? Analysis has repeatedly shown that New Zealand degree graduates - regardless of field of study - have excellent employment, income and health outcomes. A degree makes a positive difference to individual lives and to the economic and social wellbeing of our country.[1]

Now a new US study has highlighted the flexibility of graduates in the employment market. The Hamilton Project economic analysis found that “students from the same major transition into a surprising variety of occupations”, with different career paths explaining between 15% and 25% of variation in individual earnings.[2]

An MIT Technology Review exploration of the data found that even amongst STEM (science, technology, engineering and mathematics) graduates, there are some surprising movements “among graduates with degrees in physics, math, statistics, or electrical engineering, as many as 20% now work in computing-based fields” (Anders, 1 June 2017).[3]

The evidence shows that a degree pays off whatever the subject matter and that university graduate attributes such as intellectual independence and critical thinking are transferrable – and in demand. The analysis underscores the risks of prospective students (and governments) making short-sighted assumptions about the attributes associated with various degrees and graduate career trajectories.

^{[2] http://www.hamiltonproject.org/assets/files/career_paths_after_college.pdf}

^{[3] https://www.technologyreview.com/s/607946/you-dont-have-to-major-in-comp...}