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Big Problem: Your College Student Is Probably Aiming Too Low
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Big Problem: Your College Student Is Probably Aiming Too Low

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Easy classes, easy majors – lower lifelong income

If you’ve hung out with college students lately, you know that most of them choose their elective coursework based on interest, ease and — this being the youth of America — convenience. They do things like refuse to take classes that start before 11 a.m., and decide that they will never be any good at math, and opt out of classes that don’t accommodate soccer practice.

This has deeply negative long-term impacts — particularly for women and lower-income students.

A new working paper published in the National Bureau of Economic Research tracked a high school class of 2008 cohort of 138,969 U.K. students, following their high school and college careers, as well as their early professional earnings.

Let’s first talk about gender: The researchers found that women and men college students tend to enroll in courses of similar difficulty levels. But women persistently enroll in courses that correlate with lower earnings potential, such as opting for, say, Russian literature instead of a STEM class, despite having qualifications for both. This holds true even when comparing men and women within the same majors, and it equates to a roughly $11,000 per year difference in earnings following college, and much more for high-achieving women who choose low-earning subjects like education and (ahem) journalism.

The news is even darker for lower-income students. The researchers found that students from lower-socioeconomic backgrounds chronically undermatch. There are a few ways to undermatch, and these students do all of them. They are likely to choose classes for which they’re overqualified, and to enroll in courses that correlate with lower future earnings — to the tune of $34,000 less per year, on average — and to attend less-selective colleges than their abilities warrant. This last point dovetails with other studies showing that middle-income students with high test scores often fail to appear at selective schools altogether.

Let’s pause here, for a moment, to consider why this research was carried out in the U.K. The U.S. college and university system frequently waylays lower-income students with complex applications, high tuition costs and limited geographic access. The U.K. features a low-cost-for-all system (tuition maxes out at $12,500 per year, and loans are available for most or all of that sum), and a one-stop shopping admissions system, where students fill out one application and choose a handful of schools. Distance is also less of an issue: The average distance to well-matched coursework is under nine miles.

These details make it much more likely that students will match with appropriately challenging coursework and lucrative futures. “We imagined that we would find less mismatch in the U.K., but we still found large amounts of it,” says co-author Richard Murphy, assistant professor of economics at the University of Texas at Austin.

Undermatching is not just a profound waste of effort for students, but also a loss for society.  Students who match well enjoy a much bigger payoff and experience substantially more social mobility.

The solutions here are largely informational. “Students are not informed — they likely just don’t know about the earnings differences,” says Murphy. He offered some suggestions for finding better course matches.

Ask before you enroll. Yes, this is what office hours are for. Murphy suggests inquiring with professors about what courses would be appropriate for you, and where you lie on the distribution curve compared to peers. Really, this is not something to guess about. “Students should be told where they would stand in each setting,” says Murphy. This is pivotal for women, who, as a group, chronically underestimate their academic abilities.

Beware of the plight of above-average students. It’s not the smartest kids who undermatch the most, but those who rank around the 70th to 90th percentiles for performance, and hail from less-than-wealthy backgrounds. The study describes their experience as “dramatic undermatching,” resulting in an earnings gap of 26%.

Follow College Scorecard. Check graduates’ earnings for different courses of study on this Department of Education website. “Think about that when you’re choosing courses and majors,” says Murphy, so that you understand the future income decisions you’re making.

Find out minimum qualifications for courses. “When women are told the GPA threshold, more enroll,” says Murphy. Other research shows that women wrongly assume that the minimum grades for STEM classes are higher.

And above all, know that the game starts early. Simply opting for a high-quality high school erases over three-quarters of mismatch disparities, which, the researchers note, implies that school quality, peers, community and college guidance may all impact these decisions. Teenagers couldn’t possibly know all this, so perhaps leaving them to their own educational impulses should be a strategy of the past.

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