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Chapter 3. Science and Engineering Labor Force

S&E Labor Market Conditions

Labor market conditions for scientists and engineers affect the attractiveness of S&E fields to both students and those already in the labor force. Assessing the state of the labor market generally includes examining a variety of indicators that can include employment and unemployment conditions and earnings, and the interplay of these indicators with other economic measures. The most recent recession officially began in December 2007 and ended in June 2009.[11] These two endpoints represent the peak of a business cycle through the trough. Although there are no fixed definitions that identify peaks and troughs of business activity, factors such as the gross domestic product, aggregate employment, and national income are considered relevant. As various measures are presented in this section, it is important to note that many of these measures are lagging indicators. That is, they are economic factors that sometimes do not change until the economy has already begun to follow a particular trend. For example, unemployment rates can continue to rise or can remain the same although a recession has ended. Unemployment rates, involuntarily out-of-field rates, and earnings should all be considered in this context. This section looks at both long-term and recent trends in these indicators using NSF, Census Bureau, and BLS data ranging from before and continuing after the recession.

Unemployment in the S&E Labor Force

In general, those who hold S&E degrees or those working in S&E occupations have had lower rates of unemployment than other college graduates and much lower rates than those without a college education. However, this does not exempt them from unemployment due to overall business cycles or specific events affecting individuals with training in their fields.

Unemployment rates in S&E occupations are also generally less volatile than unemployment rates for these other groups (figure 3-19). The Bureau of Labor Statistics' Current Population Survey data for 1983–2010 indicate that the unemployment rate for all individuals in S&E occupations ranged from 1.3% to 4.3%, which contrasted favorably with rates for all U.S. workers (from 4.0% to 9.6%) and all workers with a bachelor's degree or higher (from 1.8% to 7.8%). The rate for S&E technicians and computer programmers ranged from 2.1% to 7.4%. During most of the period, computer programmers had an unemployment rate similar to that of workers in S&E occupations, but with greater volatility (from 1.2% to 6.7%). By 2010 unemployment rates for all U.S. workers were still increasing, while the unemployment rate for workers in S&E occupations had begun to go down.

The recent economic downturn that began in late 2007 generally follows the historic pattern. In 2008, workers in S&E occupations or S&E technician and computer programmer occupations had lower unemployment rates (2.1% or 3.9%, respectively) than all workers (5.8%). By 2009, when unemployment had reached much higher levels, workers in S&E occupations and S&E technicians and technologists still had lower rates (4.3% and 7.0%, respectively) than all workers in general (9.3%); a similar pattern existed for 2010.

Three-month unemployment rates tell a somewhat more nuanced story. College-educated S&E workers generally have lower unemployment rates than all college graduates; this pattern was still valid in the period from 2007 to 2010. However, in the 3-month period ending in September 2009, the unemployment rate of college educated S&E workers rose to 5.5%, approximately the same rate as for all college graduates (5.4%). S&E technicians and computer programmers continued to experience a considerably lower unemployment rate (8.2%) than that of the general labor force (9.7%) (figure 3-20). These rates immediately followed the end of the official recession (June 2009). Moving forward to the 3-month period ending in September 2011, the more classic pattern emerges of college-educated S&E workers having a significantly lower unemployment rate (3.8%) than all college graduates (4.8%). It should be noted, however, that unemployment rates for college graduates have remained relatively stable since approximately April 2011, while they have risen for college-educated S&E workers.

Broader Measures of Labor Underutilization

The most commonly cited unemployment measure is the percentage of people who are not working but who have looked for work in the preceding 4 weeks. This is the standard (U3) unemployment rate. In addition to U3, the Bureau of Labor Statistics reports five other rates of labor underutilization (U1, U2, U4, U5, and U6; see table 3-16). These provide additional detail about differences in employment patterns between the S&E labor force and the general U.S. labor force (appendix table 3-8).

Trends in indicators of labor underutilization during the economic downturn that began at the end of 2007 consistently indicate that workers whose most recent job was in an S&E occupation experienced lower underutilization rates than the general labor force. Moreover, the advantages for workers in S&E occupations increased over the course of the economic downturn. Figure 3-21 shows the growing gap between these workers and the general labor force in both standard (U3) and long-term (U1) unemployment rates. The difference between their monthly standard rates ranged between 3.2 and 4.1 percentage points in 2008, between 4.0 and 4.9 percentage points in 2009, and between 5.0 and 6.1 percentage points in 2010. It remained near 6 percentage points for most of 2011. Whereas general unemployment peaked at 10.5% (March 2010), S&E unemployment rose only as high as 5.6% in October 2009.

Similarly, the difference in long-term unemployment, defined as more than 15 weeks, grew as the downturn went on. It rose from about 1 to 1.3 percentage points in 2008 to between 1.5 and 2.6 percentage points in 2009, and over 3 percentage points in the first half of 2010 before dropping later in the year. Beginning near the end of 2009, the rate of long-term unemployment in the general labor force exceeded the rate of standard unemployment for those in S&E occupations.

The most comprehensive labor underutilization indicator (U6) includes various kinds of workers who are not employed full time but would like to be. More than the U3 unemployment rate, this indicator captures the difference between workers' labor market aspirations and outcomes. During the downturn, the gap between this measure and the standard unemployment rate among workers in S&E occupations was substantially smaller than the comparable gap in the general labor force (appendix table 3-8). Thus, the proportion of underutilized workers who were unemployed in the standard sense of the term was consistently higher among S&E workers than it was in the general labor force.

Unemployment Rates by Degree and Field

In most economic downturns, workers with advanced S&E degrees have been less vulnerable to changes in economic conditions than individuals who hold only S&E bachelor's degrees. Figure 3-22 compares unemployment rates over career cycles for persons with S&E bachelor's degrees and doctorates, regardless of their occupation, for 1999 and 2003—periods of relatively good and relatively difficult labor market conditions, respectively. The relatively difficult 2003 labor market had a greater effect on bachelor's degree holders: for individuals at various points in their careers, the unemployment rate increased by between 1.6 and 3.5 percentage points between 1999 and 2003. Labor market conditions had a smaller effect on doctorate holders, but some increases in unemployment rates affected individuals in most years-since-degree cohorts.

Similarly, among those who said they were working involuntarily outside the field of their highest degree, labor market conditions from 1999 to 2003 had a greater effect on the proportion of bachelor's degree holders than on doctorate holders (figure 3-23). These rates ranged from 7% to 12% for bachelor's degree holders in 2003 versus 2% to 5% for those with doctorates. Rates of working involuntarily out-of-field (IOF) for doctorate holders changed little between 1999 and 2003.

Although S&E qualifications may help workers weather recessions, they do not make them immune to the adverse labor market conditions that recessions bring. The estimated 4.3% unemployment rate for S&E occupations in April 2009, although low relative to other occupations, was the highest in 25 years.

Earnings

The estimated annual wages of individuals in S&E occupations, based on the OES survey, are considerably higher than the average of the total workforce. Median annual wages in 2010 (regardless of education level or field) in S&E occupations were $75,820, more than double the median ($33,840) for all U.S. workers (table 3-17). The spread in average (mean) wage was less dramatic but still quite wide, with individuals in S&E occupations again earning considerably more on average ($80,170) than workers in all occupations ($44,410). Mean S&E wages ranged from $71,860 for social science occupations to $87,980 for engineering occupations.

The 2007–10 annual growth in mean and median wages for both the S&E and STEM occupation groups were similar to those for employed U.S. workers in the OES data.

Workers with S&E degrees also have higher earnings than those with degrees in other fields. Figure 3-24 shows estimates of median salary at different points in life for individuals with a bachelor's degree as their highest degree in a variety of fields. Except in the first 4 years after earning their degrees, holders of S&E bachelor's degrees earn more than those with non-S&E degrees at every year since degree. Median salaries for S&E bachelor's degree holders in 2003 peaked at $65,000 at 15–19 years after receiving their degree, compared with $49,000 for those with non-S&E bachelor's degrees. Median salaries of individuals with bachelor's degrees in S&E-related fields (such as technology, architecture, or health) peaked at $52,000 at 25–29 years after degree, but were higher than those for non-S&E bachelor's degree holders regardless of years of experience.

Earnings at Different Degree Levels

Data on educational histories of all college graduates have been periodically collected by the National Survey of College Graduates, allowing for detailed comparisons of S&E and other college degree holders. Figure 3-25 illustrates the distribution of median salaries earned by individuals with S&E degrees at various levels. (Because the distributions are heavily skewed, the median is the preferred summary statistic.) Not surprisingly, salaries are higher for those with more advanced degrees. In 2003 (the most recent data available), 11% of S&E bachelor's degree holders had salaries higher than $100,000, compared with 28% of doctorate holders. Similarly, 22% of bachelor's degree holders earned less than $30,000, compared with 8% of doctorate holders.[12]

Figure 3-26 shows a cross-sectional profile of median 2003 salaries for S&E degree holders over the course of their career. Median earnings generally increase with time since degree, as workers add on-the-job knowledge to their formal training. For holders of bachelor's and master's degrees in S&E, average earnings adjusted for inflation begin to decline in mid to late career, a common pattern that is often attributed to "skill depreciation." In contrast, earnings for S&E doctorate holders continue to rise even late in their careers. Median salaries in 2003 peaked at $65,000 for bachelor's degree holders, $73,000 for master's degree holders, and $96,000 for doctorate holders.

Recent S&E Graduates

Compared with experienced S&E workers, recent S&E graduates more often bring newly acquired skills to the labor market and have relatively few work or family commitments that limit their job mobility. As a result, measures of the success of recent graduates in securing good jobs can be sensitive indicators of changes in the S&E labor market.

This section looks at a number of standard labor market indicators for recent S&E degree recipients at all degree levels and examines a number of other indicators that may apply only to recent S&E doctorate recipients.

General Labor Market Indicators for Recent Graduates

Table 3-18 summarizes some basic labor market statistics in 2008 for recent recipients of S&E degrees, with recent meaning up to 5 years from receiving the degree. Across all fields of S&E degrees, there was a 5.3% unemployment rate for bachelor's degree holders who received their degrees in the previous 5 years. This ranged from 2.1% for those with engineering degrees to 6.7% for social science degree recipients. Early in their careers, individuals tend to change jobs more often and have a higher incidence of unemployment. However, with the exception of those who earned a bachelor's degree in the social sciences, the unemployment rate for those with recent S&E degrees was less than the unemployment rate of 6.5% for the full U.S. labor force in October 2008.

A useful but more subjective indicator of labor market conditions for recent graduates is the proportion reporting that a job in their degree field was not available. This involuntarily out-of-field (IOF) rate is a measure unique to NSF's labor force surveys. At the bachelor's degree level, across all S&E fields, the IOF rate in 2008 was 7.9%, but it ranged from 2.4% for recent engineering graduates to 12.0% for recent graduates in the social sciences. In all fields of degrees, the IOF rate decreases as the level of education increases, reaching a low of 1.5% for recent doctorate recipients.

The median salary for recent S&E bachelor's degree recipients in 2008 was $39,800, ranging from $30,000 in the life sciences to $59,000 in engineering. Recent master's degree recipients had average salaries of $57,000, with recent doctorate recipients earning $65,000.

Recent Doctorate Recipients

The career rewards of highly skilled individuals in general, and doctorate holders in particular, often extend beyond salary and employment to the more personal rewards of doing the kind of work for which they have trained. No single standard measure satisfactorily reflects the state of the doctoral S&E labor market; a range of relevant labor market indicators are discussed below, including unemployment rates, IOF employment, employment in academia versus other sectors, employment in postdoc positions, and salaries. Although a doctorate opens both career and salary opportunities, these opportunities come at the price of many years of lost labor market earnings. For some doctorate holders, a postdoc position further extends this period of low earnings. In addition, some doctorate holders do not obtain the jobs they desire after they complete their education.

Although the official recession began in the United States in December 2007 and overall unemployment rose precipitously after April 2008, as of October 2008, the labor market indicators for individuals who recently earned an SEH doctoral degree in the United States remained relatively positive. Their unemployment rate was only modestly higher than in April 2006; the rate of working involuntarily outside of one's field was slightly lower than in 2006; the decline in the proportion of recent doctorate holders who had secured either tenure or tenure-track faculty appointments was modest; and inflation-adjusted salaries rose considerably between 2006 and 2008.

Unemployment

As of October 2008, the 1.5% unemployment rate for SEH doctorate recipients up to 3 years after receiving their doctorates was considerably lower than the unemployment rate of the civilian labor force in general (6.5%) and the unemployment rate for recent recipients of S&E bachelor's degrees (5.3%). Among recent SEH doctoral degree recipients, the unemployment rate in each of the broad SEH degree areas was lower in 2008 than it was in 2003 with the exception of the physical sciences (table 3-19). With a 3% unemployment rate, the physical sciences had considerably higher unemployment among recent doctoral degree recipients than other SEH areas. Indeed, in all other broad SEH fields except the social sciences the unemployment rate among recent SEH doctoral degree recipients was below 2% in 2008.

Working Involuntarily Outside the Field

In addition to the 1.5% who were unemployed in 2008, another 1.3% of recent SEH doctorate recipients in the labor force reported that they took a job that was not related to the field of their doctorate because a job in their field was not available. The share of recent SEH doctoral degree recipients who have reported involuntarily working outside of their field has declined steadily from 2001, when the IOF rate was 2.8% (table 3-19).

The highest IOF rates were found for recent doctorate recipients in the physical sciences and the social sciences. However, within the physical sciences the IOF rate declined from 5.4% to 2.3% between 2001 and 2008.

Tenure-Track Positions

Many SEH doctorate recipients may aspire to tenure-track academic appointments, but most will end up working in other positions and sectors. In 2008, 16% of all those who had earned their SEH doctoral degree within the previous 3 years had a tenure or tenure-track faculty appointment, a share that has held broadly steady since 1993, with a 2003 peak approaching 19% and subsequent modest declines (table 3-20).

The share of SEH degree recipients who hold a tenure or tenure-track faculty appointment increases with increasing time since earning the doctorate. In 2008, the proportion of SEH doctorates with tenure or tenure-track appointments who were less than 3 years from completing their doctorate was 16.2%; for those who had been in the labor market for 3 to 5 years, the comparable rate was 22.9%. In computer and information sciences, 22.0% of individuals who had less than 3 years in the labor force since earning their doctoral degree had a tenure or tenure-track faculty appointment; the proportion increases by 15.8 percentage points to 37.8% for those 3 to 5 years from the doctoral degree. Psychology and the social sciences are the only areas that do not show a dramatic rise in the share of the labor force with a tenure or tenure-track appointment among those with 3 to 5 years of labor market exposure compared to those with less than 3 years of labor market exposure. (See chapter 5 for a discussion of trends in tenure-track positions as a proportion of all academic positions.)

The availability of tenure-track positions may be counterbalanced by the availability of desirable nonacademic employment opportunities. One of the quickest declines among recent doctoral degree recipients in tenure-track employment occurred in computer sciences, from 31.5% in 1993 to 18.2% in 1999 despite the high demand for computer sciences faculty (table 3-20).

Salaries for Recent SEH Doctorate Recipients

For all SEH degree fields in 2008, the median annual salary for recent doctorate recipients up to 5 years after they received their degrees was $67,000. Across various SEH fields of degree, median annual salaries ranged from a low of $50,000 in the biological sciences to a high of $88,000 in computer and information sciences (table 3-21). From 2006 to 2008, salaries for recent recipients of doctoral degrees rose considerably. After adjusting for inflation, the median salary for recent doctoral degree recipients rose by 17%.

By type of employment, salaries for recent doctorate recipients ranged from $42,000 for postdoc positions to $85,000 for those employed by private for-profit businesses (table 3-22).

Postdoc Positions

The growing number of recent doctorate recipients in postdoctoral appointments, generally known as postdocs,[13] has become a major concern in science policy. Neither the reasons for this growth nor its effect on the health of science are well understood. Increases in competition for tenure-track academic research jobs, collaborative research in large teams, and needs for specialized training are possible factors explaining this growth. Although individuals in postdoc positions often perform cutting-edge research, there is concern that time spent in a postdoc position is time added onto the already long time spent earning a doctorate, thereby delaying the start and advancement of independent careers. Because postdoc positions usually offer low pay, forgone earnings add significantly to the costs of a doctoral education and may discourage doctoral-level careers in S&E.

How Many Postdocs Are There?

In 2010, Science and Engineering Indicators (NSB 2010) included an analysis of a one-time postdoc module from the 2006 Survey of Doctorate Recipients (SDR), and compared it to data collected on NSF's Survey of Graduate Students and Postdocs in Science and Engineering, in order to estimate the total number of postdocs in the United States. Similar more recent data from the SDR are not available. However, there are several point estimates from more recent years.

In October 2008, the SDR measured 27,100 individuals with SEH doctorates who were employed in postdoc positions. The SDR covers U.S. residents with research doctorates in SEH fields from U.S. universities, but not those with non-U.S. doctorates. The NSF Graduate Student Survey (GSS) gathers information on postdocs from U.S. academic graduate departments, regardless of where these individuals earned their doctorates. It does not cover people in nonacademic employment, at some university research centers, or at academic departments that lack graduate programs. The fall 2008 estimate from the GSS was 54,100 postdocs. The SDR and GSS estimates overlap in some populations (U.S.-trained doctorates and those working in academia), but differ in others (GSS covers foreign-trained doctorates, but not those in the industry or government sectors).

Postdocs by Academic Discipline

More than half of all U.S.-educated SEH doctorates in postdoctoral positions in 2008 (57%) had doctorates in biological or health sciences (figure 3-27). In these fields, postdoc training has been common for a long time and individuals remain in postdoc positions longer than in other fields. Psychology, chemistry, and physics also have high rates of graduates entering postdoc positions and together make up another one-quarter of postdoc positions. The remaining quarter come from all other SEH fields, most of which do not have a strong postdoc tradition as part of their career paths.

Increase in the Likelihood and Length of Postdoc Positions

Among holders of U.S. SEH doctorates received before 1972, 31% reported having had a postdoc position earlier in their careers (NSB 2010). This proportion has risen over time to 46% among 2002–05 graduates and has increasingly involved fields in which, formerly, only a small number of doctorate recipients went on to postdoc positions. In traditionally high-postdoc fields such as the life sciences (from 46% to 60%) and the physical sciences (from 41% to 61%), most doctorate recipients now have a postdoc position as part of their career path. Similar increases were found in mathematical and computer sciences (19% to 31%), social sciences (18% to 30%), and engineering (14% to 38%). Recent engineering doctorate recipients are now almost as likely to take a postdoc position as physical sciences doctorate holders were 35 years ago.

Postdoc Pay and Benefits

Low pay and fewer benefits for postdocs are frequently raised as concerns by those worried about the effect of the increasing number of postdoc positions on the attractiveness of science careers. The median academic postdoc salary is 44% less than the median salary for nonpostdocs up to 5 years after receiving their doctorates (table 3-23). Among engineering doctorates, academic postdocs are paid half the salary of those who are not in postdoc positions up to 5 years after receiving their doctorate. Among social sciences doctorates, this gap is closer to one-quarter (24%). Nonacademic postdocs are better paid than academic postdocs, but their median salary is still 33% less than that of those who are not in postdoc positions.

The 2006 Survey of Earned Doctorates asked about employment benefits among postdocs. Across all S&E fields, 90% of postdocs reported having medical benefits and 49% reported having retirement benefits. It is not possible to know from the survey how extensive medical benefits may be or how transferable retirement benefits are. In the social sciences, medical benefits are less available, with only 75% of postdocs reporting that they had medical benefits.

Postdoc Positions as a Sign of Labor Market Distress

In 2006, former postdoc position holders reported reasons for accepting their appointment that are consistent with the traditional intent of a postdoc position as a type of apprenticeship, such as seeking "additional training in doctorate field" or "training in an area outside of doctorate field." However, 10% of SDR respondents in a postdoc position in October 2008 reported that they took their current postdoc position because "other employment not available." This reason was given by 9% of postdocs in the biological and agricultural sciences, 5% in the health sciences, 12% in computer sciences and mathematics, 12% in the physical sciences, 6% in the social sciences, and 16% in engineering.

Postdoc Outcomes

In 2006, most former postdocs reported that their most recent postdoc appointment had enhanced their career opportunities, and the proportions who said this were similar for different cohorts (NSB 2010). Across all S&E fields and cohorts, 53%–56% of former postdocs said that their postdoc appointment enhanced their career opportunities to a "great extent"; an additional 33%–38% said that their postdoc appointment "somewhat" enhanced their career opportunities. The proportion of those completing postdoc positions who said that it was no help to their career opportunities ranged from only 8% for the 2002–05 graduation cohort to 12% for the 1987–91 cohort. For a more detailed look at perceived and actual outcomes from a postdoc experience, see chapter 3 in the 2008 edition of Science and Engineering (NSB 2008) and NSF/SRS (2008b).

Notes

[11] The Business Cycle Dating Committee of the National Bureau of Economic Research is generally the source for determining the beginning and end of recessions or expansions in the U.S. economy. See http://www.nber.org/cycles/recessions.html for additional information.
[12] Many doctorate holders with salaries at this level are postdocs in temporary training positions.
[13] Although the formal job title is often postdoc fellowship or research associate, titles vary among organizations. This chapter generally uses the shorter, more commonly used, and best understood name, postdoc. A postdoc is traditionally defined as a temporary position that individuals take primarily for additional training—a period of advanced professional apprenticeship—after completion of a doctorate.
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