Race and gender differences in educational attainment, field of study, and increments to earnings (evidence from University of Illinois tracer studies and nationwide earnings data)

This study uses a rate of return model and a Regression technique to estimate the net effects of investment in higher education in the United States, more comprehensively on key measures of monetary and non-monetary outcomes of education. Specifically, the study examines the returns to University of Illinois education by race, gender, and field of study using the university's tracer study data for the 5,060 1988 graduates from the UI (Urbana and Chicago campuses), after they have been in the labor force 10 years after graduation. Recognizing that individual earnings are potentially associated with multiple factors, this study compares earnings of the 1988 graduates of the University of Illinois and explores the association between major field of study and the mean annual earnings 10 years after graduation. Clarifying the monetary and non-monetary returns of those graduating with the same degree and majors, and understanding the relationship of factors that may affect individual earnings may help to clarify the benefits of pursuing a college degree and/or major in a specific field. The findings suggest that of the four degree levels studied, field of study was generally the strongest predictor of returns for students in University of Illinois (Urbana and Chicago campuses), although the significance of predictors varied by race and by gender. For example, the returns to graduates in professional fields such as medicine are higher than those returns to Ph.D. degree, master's degree, and bachelor's degree graduates. Also, the returns to fields classified as "high-paying" such as engineering and commerce are higher than the returns to liberal arts and science and other fields such as education, agriculture-related fields, fine and applied arts, applied life science and other social science fields. The completion rates of bachelor's degree also varied by race and by gender. This information about the monetary and non-monetary returns over the life cycle when conveyed to students, educators, employers and legislators can be helpful in broadening the understanding that helps in investing in colleges and universities.