Working Paper: NBER ID: w23333
Authors: Rachel Baker; Eric Bettinger; Brian Jacob; Ioana Marinescu
Abstract: An important goal of community colleges is to prepare students for the labor market. But are students aware of the labor market outcomes in different majors? And how much do students weigh labor market outcomes when choosing a major? In this study we find that less than 40% of a sample of community college students in California rank broad categories of majors accurately in terms of labor market outcomes. However, students believe that salaries are 13 percent higher than they actually are, on average, and students underestimate the probability of being employed by almost 25 percent. We find that the main determinants of major choice are beliefs about course enjoyment and grades, but expected labor market outcomes also matter. Experimental estimates of the impact of expected labor market outcomes are larger than OLS estimates and show that a 1% increase in salary is associated with a 1.4 to 1.8% increase in the probability of choosing a specific category of majors.
Keywords: Labor Market Information; Community College; Major Choice; Employment Outcomes; Education Policy
JEL Codes: I21; I23; J01; J18; J30
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Misconceptions about labor market outcomes (J49) | Major choice (G11) |
| Expected salary (J31) | Probability of selecting a major (C15) |
| Probability of employment (J68) | Probability of selecting a major (C15) |
| Labor market information (J20) | Major choice (M59) |