📖 What we’re reading
Misusing economic statistics: native-born employment is not on the rise. A misinterpretation of recent job reports—that native-born employment has climbed significantly—has been repeated by administration officials. However, the claims ignore caution from statistical agencies that produce these reports against using them to quantify foreign-born and native-born populations. Jed Kolko clears up the confusion by explaining how these numbers are created, how best to understand them, and why they do not show gains in employment rates among the U.S.-born.
What can explain the college wage premium? The difference in wage growth patterns between those with a college education and those without is well-researched but not fully understood. In a recent paper, David Deming establishes that occupational sorting plays a primary role in the growth of college wage premiums. He shows that college graduates quickly move to professional, non-routine jobs that reward time on the job at a higher rate. Notably, college graduates are far less likely to switch jobs, and they experience high wage growth within their jobs over time.
Should college be free for top students? Douglas Harris and Jonathan Mills investigate how the cost of higher education affects student decisions. They ran an eight-year randomized trial in which high schoolers received a $12,000 merit-based grant offer toward college tuition. They found that students who received the grant engaged in more low-burden college preparatory behaviors in high school—such as participating in access programs and filling out the FAFSA—but that the grant had no effect on GPA, attendance, high school graduation, or college entry. The study’s analysis sheds light on the difficulty of measuring “merit” and determining optimal educational grant sizes.
