In a recent article on CNNMoney.com, college grads are getting offered bigger paychecks for the first time since 2008. The article goes on to state new graduates are averaging $50,034 per year starting salaries. Engineering degrees are averaging $59,435 per year. Electrical engineering degrees are averaging the highest of $61,690 and civil engineering the lowest of $48,885. Business and accounting degrees are averaging from $48-50,000 per year. Finance degrees top the list of business degrees at $50,535, then Accounting at $49,022 and Business degrees at $48,089. Last are liberal arts degrees are averaging $35,633.
Did you notice that huge distinction between degrees? I know I did! Did the students who earned liberal arts degrees receive a discount on tuition? I don’t think so. If everyone pays the same for the degree, why major in liberal arts? Many people who major in liberal arts go on to graduate school or professional school. How about those who do not? What do they do? They have to turn their degree into a practical application in the business world. For example, an English degree can be used in marketing, advertising, journalism, publishing, or academia. Are these well paying jobs? Initially, no! The reason is you may need more training to achieve the better paying careers. Remember, you still have the same student loans as the other students.
From a financial point of view, everyone should go into the higher paying degrees. How are your math and science skills? How are your business skills? If you liked any of those choices and had the skills, I would not have to convince you to get that degree. What does the rest of the graduates do? Part of the reason, companies are willing to pay for those degrees is they are fewer graduates in those disciplines. Whether it is interest, skills or talent, there are less graduates. One of this country’s problems is not enough students want to earn engineering, science or math degrees. What should you do?
Your major or degree does not dictate what you will accomplish in your life! I worked for a president of a company who majored in English, but went into marketing. He was very successful. I did some financial consulting years ago for a major tax software company and the head of development was a individual with a physical education degree. Both people earned well into six figures. One of the most successful mystery writers was a advertising executive before he became a writer. The road to success is not a map, you buy in a store! You are the person who determines your road to success.
While you are toiling away in your first job or in those early years trying to figure out if your education debt was worthwhile, start thinking about your goals. If you majored in some obscure major like rhetoric, French history or Chinese literature, I hope you have good grades. Graduate school requires that, your first job looks at it and it is an indication of your skills in that major. It measures your academic learning skills, interest and acumen in the subject. An employer would expect that you would approach your work in the same way and have the same success. If you had poor grades in college, can you recover? Of course you can! The opposite is equally true! Good grades in college do not guarantee success. Employers pay for performance and promotions are generally based on your performance. Would it have been easier to major in one of the higher paying careers? What do you think?
Photo by: kevindooley
I majored in business as an undergrad, and later went full-time for an MBA. I think that the business major helped me with admissions, and possibly jobs later.
However, I know of people who majored in more obscure disciplines, yet managed to go places. I recall a music major, theatre major, and a philosophy major who eventually got into MBA programs (1 in a Top 5 program) and became quite successful.
Ultimately, I think that the talent rises to the top regardless of major. However, the path of least resistance can be a more in-demand major (finance, engineering, etc). Regardless of major, get good grades. They will matter for grad school admissions and/or for your first job.
I agree, however I am questioning the relative worth of a liberal arts degree, if you don’t go to graduate or professional school.
I’m an engineer and it was a good choice. Since I footed most of the bill, there was no way I was busting my butt on a major that wasn’t tied to a specific career at the end. It looks like starting salaries have actually gone down some (at least in engineering) from the boom times.
As you know, there many more graduates with liberal arts majors than engineering, accounting, computer science, math, and science together. Regarding your salaries comment, perhaps it is due to supply and demand withe the high unemployment?
Chris @ MyMoneyMess says
Let’s face it, in terms of degrees, the money is in technical fields and business.
No one who’s hiring is going to give two hoots about an English, History or Philosophy degree. There’s little practical use for them in the workplace.
Their degree indicates they are trainable! Some of the degrees are closely related to certain marketing careers. The other alternative is graduate or professional school.
Financial Samurai says
Great to hear 22 year olds are now making $50,000-$62,000 a year right out of school! Very encouraging signs for consumer spending and the economy.
True! The disparity of income between liberal arts degrees and the engineering/business degrees is getting bigger.
I totally agree. Why pick a degree that doesn’t give you much ROI? Getting an applied degree is the way to go. A lot of people here in Vancouver go to UBC (like an Ivy league Canadian school) for their general degree, and then they do another two years in a technical college for their skills and to get a job that is more applicable.
There are two schools of thought about this. One where I agree with you, the other where college or university prepares you for many careers. I believe each is correct. I just found it interesting there is such a large disparity of beginning salaries.
Ryan@Financial Student says
This is encouraging. I’ll graduate in 2014 with a business degree (either finance or accounting), so I’m hopeful that employment will be much easier to find than it is today.
Most of my friends are majoring in fields that have direct job opportunities (education, mechanical engineering, finance, etc.), but I have others taking on huge amounts of student loan debt for liberal arts degrees that worry me.
If you like accounting, think about the CPA route. A CPA license provides a lot of choices. If finance is your preference,, you may need an MBA (the best school you can get into). A Finance MBA would probably lead to Wall Street. Whatever you choose, good luck.
Money Reasons says
I went with a comp sci degree, and it’s worked out well for me… I wish I would have went with a finance degree though 🙂
If you went the finance route, you probably would need an MBA from a top school. Would you do M & A with the Wall Street firms? Probably become rich through those large bonuses! 🙂
Roshawn @ Watson Inc says
My degrees are in pharmacy and the pharmaceutical sciences. It’s not an apples to apples comparison anymore, since you can no longer enter my type of job without a graduate or professional degree.
With respect to the article, it’s difficult sometimes navigating that first job anyway. I vote to go with a degree/career that is a good fit for you, knowing that life will bring some change!
It certainly has for me! Teaching is my eighth career and I am working on my ninth (blogging/writing)! A college degree is supposed to prepare you for multiple careers whether it is directly related or not. Engineers and accountants generally go into management someday or own their businesses.
Kaiser Villaviciencio says
Perhaps the reason why higher pays are on technical graduates is because of the lack of supply and higher demand. More students are becoming more interested in Liberal Arts these days, yet some of them get into business, too. Good grades are required for some graduates to get hired, but it’s always a matter of adapting to changes and challenges in the business world after schooling. There are graduates who are likely to pursue passions than huge paychecks, though.
I don’t think it is just the interest level in technical degrees. I think it is the skills and talent as well as interest that is lacking. I know of people who majored in liberal arts who eventually chose to pursue a MBA and JD degrees.