We don’t need more humanities majors

July 30, 2013

The Question: This piece is in response to the question: do we need more humanities majors? You can read the “yes” answer to this question here and make your case here

About the author: Ed Conard is the author of “Unintended Consequences: Why Everything You’ve Been Told About the Economy is Wrong.” He is a visiting scholar at the American Enterprise Institute (AEI) and a former Managing Director at Bain Capital. This piece reflects his opinion.

Students experiment with patterns at an interactive display at the National Museum of Mathematics in New York, Monday, Dec. 17, 2012. (AP Photo/Seth Wenig)
Students experiment with patterns at an interactive display at the National Museum of Mathematics in New York, Monday, Dec. 17, 2012. (AP Photo/Seth Wenig)

It’s no secret that innovation grows America’s economy. But that growth is constrained in two ways. It is constrained by the amount of properly trained talent, which is needed to produce innovation. And it is constrained by this talent’s willingness to take the entrepreneurial risks critical to commercializing innovation. Given those constraints, it is hard to believe humanities degree programs are the best way to train America’s most talented students.

According to the Bureau of Labor Statistics (BLS), U.S. employment has grown roughly 45 percent since the early 1980s. Over the same period, Germany’s employment grew roughly 20 percent, while France’s employment grew less than 20 percent and Japan’s only 13 percent. U.S. employment growth put roughly 10 million immigrants to work since the BLS started keeping track in 1996 and it has employed tens of millions of people offshore. The share of people in the world living on less than $1.25-a-day has fallen from over 50 percent to nearly 20 percent today, according to The World Bank. Name another high-wage economy that has done more than the United States for the employment of the world’s poor and middle class during this time period.

Contrary to popular belief, U.S. employment growth isn’t outpacing other high-wage economies because of growing employment in small businesses. Europe has plenty of small family-owned businesses. U.S. growth is predominately driven by successful high-tech startups, such as Google, Microsoft, and Apple, which have spawned large industries around them.

A Kauffman Institute survey of over 500 engineering and tech companies established between 1995 and 2005 reveals that 55 percent of the U.S.-born founders held degrees in the science, engineering, technology or mathematics, so called STEM-related fields, and over 90 percent held terminal degrees in STEM, business, economics, law and health care. Only 7 percent held terminal degrees in other areas — only 3 percent in the arts, humanities or social sciences. It’s true some advanced degree holders may have earned undergraduate degrees in humanities, but they quickly learned humanities degrees alone offered inadequate training, and they returned to school for more technical degrees.

Other studies reach similar conclusions. A seminal study by Stanford economics professor Charles Jones estimates that 50 percent of the growth since the 1950s comes from increasing the number of scientific researchers relative to the population. Another recent study from UC-Davis economics professor Giovanni Peri and Colgate economics associate professor Chad Sparber finds the small number of “foreign scientists and engineers brought into this country under the H-1B visa program have contributed to 10%-20% of the yearly productivity growth in the U.S. during the period 1990-2010.” Despite the outsized importance of business and technology to America’s economic growth, nearly half of all recent bachelor’s degrees in the 2010-2011 academic year were awarded in fields outside these areas of study. Critical thinking is valuable in all forms, but it is more valuable when applied directly to the most pressing demands of society.

At the same time, U.S. universities expect to graduate a third of the computer scientists our society demands, according to a study released by Microsoft. The talent gap in the information technology sector has been bridged by non-computer science majors, according to a report by Daniel Costa, the Economic Policy Institute’s director of immigration law and policy research. Costa finds that the sector has recruited two-thirds of its talent from other disciplines—predominately workers with other technical degrees. But with the share of U.S. students with top quintile SAT/ACT scores and GPAs earning STEM-related degrees declining sharply over the last two decades, the industry has turned to foreign-born workers and increasingly offshore workers to fill its talent needs. While American consumers will benefit from discoveries made in other countries, discoveries made and commercialized here have driven and will continue to drive demand for U.S. employment—both skilled and unskilled.

UC-Berkeley economics professor Enrico Moretti estimates each additional high-tech job creates nearly five jobs in the local economy, more than any other industry. Unlike a restaurant for example, high-tech employment tends to increase demand overall rather than merely shifting employment from one competing establishment to another. If talented workers opt out of valuable training and end up underemployed, not only have they failed to create employment for other less talented workers, they have taken jobs those workers likely could have filled.

Thirty years ago, America could afford to misallocate a large share of its talent and still grow faster than the rest of the world. Not anymore; much of the world has caught up. My analysis of data collected by economics professors Robert Barro of Harvard University and Jong-Wha Lee of Korea University reveals that over the last decade America only supplied 10 percent of the increase in the world’s college graduates, much less than the roughly 30 percent it supplied thirty years ago. Fully harnessing America’s talent and putting it to work addressing the needs of mankind directly would have a greater impact on raising standards of living in both the United States and the rest of the world than other alternatives available today.

READ: We need more humanities majors

MAKE YOUR CASE: Do we need more humanities majors?

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