College Major, Employment Status and Earnings

 

The relationship between college major and employment status has been getting a lot of attention. The Mellon Foundation claims that “around 95 percent of terminal humanities bachelor’s degree holders between the ages of 23 and 32 were fully employed” based on this study by the American Academy of Arts and Sciences. The New York Times suggests that computer science majors have to take jobs at Chipotle based on this study by the Federal Reserve Bank of New York. Numerous people on Bluesky have shared these articles, sometimes combining the claims about employment and unemployment with claims about higher earning potential for humanities majors, like historians than computer science and engineering majors.

 

The actual reports that these claims based on are worth looking at. Here are a few things to note.

1.       These are estimates of unemployment based upon  the American Community Survey (ACS) done by the Census Bureau. ACS is a one percent sample taken every year. Because it is a very large survey (they ask a lot of people a lot of questions) there is some delay in getting the data. The estimates from the NY Fed are are from the data collected in 2023, and the American Academy of Arts and Sciences study uses 2021 data.

2.       The estimates based on the ACS define unemployment in the same way as the Bureau of Labor Statistics, which produces the widely cited monthly estimates of unemployment based upon the Current Population Survey of 60,000 households. Someone is unemployed if they do not have a job and are actively seeking one. The labor force is composed of all the people who are employed and all the people who are unemployed. The unemployment rate is the percentage of the labor force that is unemployed.

3.       This definition of the unemployment rate means that you can’t just subtract the unemployment rate from 100 and declare that to be the unemployment rate as was done by the Mellon Foundation. Imagine you are looking at a labor force composed of a particular group of people, say people aged 22- 27 with a degree in history. For simplicity imagine there are 100 people, 95 are employed and 5 are unemployed. The unemployment rate is obviously 5 percent. But I can’t say anything about the employment rate for the entire population of history majors unless I also know how many history majors are not in the labor force, i.e., do not have a job and are not looking for one. If there are five of them then the percentage of the population that is employed would be 95 divided by 105 or 90 percent; if there are 10 of them the employment rate would be 95 divided by 110 or 86 percent. The Mellon Foundation's claim assumes a one hundred percent labor force participation rate.

4.       ACS and CPS use the same definition but collect data differently. BLS does a survey every month, ACS surveys are collected throughout the year. People who report unemployment to the CPS were all unemployed around the same time, people who reported unemployment to ACS were not necessarily unemployed at the same time. ACS estimates are higher than CPS estimates. For 2022, the ACS estimate of the U.S. unemployment rate was 4.3 percent while the CPS estimate was 3.6 percent.

5.       The NY Fed’s report also provides underemployment estimates for each major. Underemployment is defined as employment is a job that does not typically require a college degree. The NY Times article compared computer science and computer engineering that had unemployment rates of around 6 and 7 percent to biology and art history, which had rates of around 3 percent. But computer science and computer engineering had underemployment rates less than 20 percent while biology and art history had underemployment rates over 40 percent. The low underemployment in comp sci is consistent with a story in which some of the unemployment is voluntary in the sense that it results from people not taking the first job that comes along. The low underemployment rate is not consistent with a lot of computer science majors accepted jobs at Chipotle.

6.       Putting together points 3 and 5 suggests that the Mellon claim that “around 95 percent of terminal humanities bachelor’s degree holders between the ages of 23 and 32 were fully employed” is doubly misleading: you can’t tell from the unemployment rate how many are employed or how many of the employed are “fully employed.”

7.       The story that the NY Times wants to tell about over supply of computer science grads because of too much hype about it being the lucrative major compounded with AI replacing computer scientists may be true. But the evidence of it is not that clear in the data from 2023. Both the continued high starting salaries, about double those of art history and biology, and the low rates of underemployment are still pretty consistent with strong demand for computer science majors at that time. This would seem to be supported by the BLS estimates of occupational unemployment rates in July 2025 the estimated unemployment rate for computer and mathematical occupations was 2.9 percent.

8.       None of the cited studies support the claim that over the course of their careers history majors out earn computer scientists and engineers. The NY Fed study shows both early and mid-career salaries that are substantially higher for computer science and engineering majors than for history majors: mid-career median was $77,000 for history majors and $122,000 form computer engineering majors.

9.       None of this is to say that you should abandon history and study computer science. You should try to maximize your satisfaction (or utility in economic terms) not your monetary income. Yes, we get satisfaction from the stuff we buy with our income. Many people also get satisfaction from the prestige associated with a higher income. But many of us also get satisfaction from what we do in our job. 

10.   By the way, I didn’t have an undergraduate major. I went to The Evergreen State College, which does not have majors. I have a B.A. in Liberal Arts.

Google AI?

 

Google AI seems to have difficulty using Google. The search was for "Washington Post 25 best musicals of the 21st century." 

Billy's Books: Property and Slavery

I'm reading Laura Edwards recent paper on "Trunks, Legal Texts, and the Materiality of Law in the Nineteenth Century." The Journal of the Civil War Era 15, no. 2 (2025): 157-183. The paper examines the ways in which trunks enabled people, including married women and enslaved people, to make claims to ownership even when legal texts did not seem to support those claims.

The paper reminded me of an advertisement in the Virginia Herald that I ran across while doing some research on Fredericksburg in the 1820s.

What struck me about the ad was the line that he took with him "a variety of clothing and his books." I was struck by the fact that in fleeing slavery one of the things he chose to carry with him were books and by the fact that the slaveowner referred to them as "his books" when he could have just said "a variety of clothing and books."

I wish I knew more of this story. Of course there is the big question of what happened to Billy, but would also love to know what books he took with him. 

Development of the American Economy

 The NBER  Development of the American Economy Summer Institute is currently taking place. 

There are links to some of the papers here

and you can watch on YouTube

Robert Allen on Arabian Economic History

 Sean Kenny has a new episode of The Economic History Podcast with Robert Allen. 

From the Sand Up: How the Natural Environment shaped the Arabian Economy

Prof. Robert Allen discusses how the desert environment led to a unique economic structure-"from the sand up". Bob takes us through the economic implication of communal lands and describes the differences between the nomadic (Bedouin) and oasis economies. He suggests that religious structures were convenient in eventually consolidating various regions/tribes in the form of states. We also consider the incentives for a unique type of slavery, that arose from the nature of date farming/pearl diving in contrast to the Caribbean sugar plantation experience. 

They also talk about how Allen go into economic history and his advice on doing economic history. 

Overlooked Commodities in American Economic History

 

New NBER working paper today

Firewood in the American Economy: 1700 to 2010.

Nicholas Z. Muller

 

Despite the central role of firewood in the development of the early American economy, prices for this energy fuel are absent from official government statistics and the scholarly literature. This paper presents the most comprehensive dataset of firewood prices in the United States compiled to date, encompassing over 6,000 price quotes from 1700 to 2010. Between 1700 and 2010, real firewood prices increased by between 0.2% and 0.4%, annually, and from 1800 to the Civil War, real prices increased especially rapidly, between 0.7% and 1% per year. Rising firewood prices and falling coal prices led to the transition to coal as the primary energy fuel. Between 1860 and 1890, the income elasticity for firewood switched from 0.5 to -0.5. Beginning in the last decade of the 18th century, firewood output increased from about 18% of GDP to just under 30% of GDP in the 1830s. The value of firewood fell to less than 5% of GDP by the 1880s. Prior estimates of firewood output in the 19th century significantly underestimated its value. Finally, incorporating the new estimates of firewood output into agricultural production leads to higher estimates of agricultural productivity growth prior to 1860 than previously reported in the literature.

 

And if you haven’t already read it take a look at

Ron, Ariel. "When hay was king: Energy history and economic nationalism in the nineteenth-century United States." The American Historical Review 128, no. 1 (2023): 177-213.