For students chasing lasting wealth, the best choice of a college major is less obvious than you might think.
The conventional wisdom is that computer science and engineering majors have better employment prospects and higher earnings than their peers who choose liberal arts.
This is true for the first job, but the long-term story is more complicated.
The advantage for STEM (science, technology, engineering and mathematics) majors fades steadily after their first jobs, and by age 40 the earnings of people who majored in fields like social science or history have caught up.
This happens for two reasons. First, many of the latest technical skills that are in high demand today become obsolete when technology progresses. Older workers must learn these new skills on the fly, while younger workers may have learned them in school. Skill obsolescence and increased competition from younger graduates work together to lower the earnings advantage for STEM degree-holders as they age.
Second, although liberal arts majors start slow, they gradually catch up to their peers in STEM fields. This is by design. A liberal arts education fosters valuable “soft skills” like problem-solving, critical thinking and adaptability. Such skills are hard to quantify, and they don’t create clean pathways to high-paying first jobs. But they have long-run value in a wide variety of careers.