Seems like a lot of what I write about these days is trying to set the record straight on the value of a four year degree. To counter what increasingly passes for conventional wisdom that if you don’t have a four year degree in a STEM field you are better off pursuing a two year degree or occupational certificate to find employment in a skilled trade.
Lets look at data to see if that conventional wisdom aligns with today’s Michigan labor market. Using the American Community Survey we looked at employment and median wages by occupational cluster in Michigan in 2014. They break occupations down into five broad categories:
- Management, business, science and arts occupations
- Service occupations
- Sales and office occupations
- Natural resources, construction and maintenance occupations
- Production, transportation and material moving occupations
The first category being predominantly professionals and managers. The occupations where those with a bachelors degree or more are heavily concentrated. Although technical occupations in fields like health and IT are included in this cluster as well. The services occupations includes police and fire protection which most would think of as more like the professional and manager cluster rather than the low wage, low skill service fields––healthcare support; food prep and serving; cleaning and maintenance; and personal care and services––they are included with.
Lets look at employment first. Below are the total employment and full time year round employment for each of the five occupational clusters. There are 4,448,000 employed Michiganders. 2,914,000 (65 percent) of them working full time year round.
- Management, business, science and arts occupations: 1,568,000 total employment; 1,175,000 full time year round
- Service occupations: 798,000 total employment; 350,000 full time year round
- Sales and office occupations: 1,024,000 total employment; 628,000 full time year round
- Natural resources, construction and maintenance occupations: 349,000 total employment; 247,000 full time year round
- Production, transportation and material moving occupations: 708,000 total employment; 513,000 full time year round
The proportion of full time year round workers is as follows:
- Management, business, science and arts occupations: 40.3%
- Service occupations: 12.0%
- Sales and office occupations: 21.6%
- Natural resources, construction and maintenance occupations: 8.5%
- Production, transportation and material moving occupations: 17.6%
Now lets look at pay. The median wage for all Michigan full time year round workers is $43,685. Median wages for year round full time workers by occupational cluster are:
- Management, business, science and arts occupations: $61,674
- Service occupations: $25,920
- Sales and office occupations: $36,559
- Natural resources, construction and maintenance occupations: $43,386
- Production, transportation and material moving occupations: $36,598
The last two clusters best capture the blue collar occupations that historically were the core of Michigan’s middle class. They now account for 26.1 percent of Michigan full time year round jobs. (23.8 percent of all jobs). Median wages are below the median for all full time year round Michigan workers. Around $20,000 a year lower than those in management, business, science and arts occupations.
Since manufacturing is so emphasized in our conversations about the economy and politics, its worth highlighting that there are now 337,000 full time year round production workers with a median wage of $36,598. Nearly $7,000 below the median wage for all Michigan full time year round workers. Production workers are 11.6 percent of Michigan’s full time year round workers and 9.6 percent of all workers.
Finally, what about STEM occupations? There are 258,000 computer, engineering and science workers; 219,000 working full time year round. The median wage for those full time year round workers is $72,442. Healthcare practitioner and technical occupations have 187,000 workers; 131,000 full time year round. The median wage for those full time year round workers is $67,089.
Combined these two sub clusters are a good proxy for STEM workers in the Michigan economy. They are high wage occupations. Combined they account for 12.0 percent of Michigan’s full time year round workers. (Ten percent of all Michigan workers.) And 28.3 percent of full time year round workers in all management, business, science and arts occupations.
The non STEM management, business, science and arts occupations employ 825,00 full time year round workers. With median wages by sub cluster of:
- Management, business and financial occupations: $64,292
- Education, legal, community service, arts, and media occupations: $51,921
The data are clear: Yes STEM occupations have the highest wages and employ lots of Michiganders. But there are far more jobs in non STEM professional and managerial occupations and they are high wage too.
Although it is masked in this data, of course, there are good paying occupations that don’t require a four year degree. But far fewer and at lower median wages than conventional wisdom would have it. The new reality is that the mass middle class in Michigan and America today and, almost certainly, more so in the future, are professionals and managers in all fields. And that getting a four year degree is the most reliable path––no guarantees––to those good paying jobs.
