Speaking of Veterans and STEM… Part II
By Will Hubbard, Vice President of Government Affairs
With the resources provided by the Veterans Educational Assistance Act of 2008, or “Post-9/11 GI Bill”, the marginal cost of an additional academic year for student veterans pursuing STEM (science, technology, engineering, and math) will yield the essential mass of leaders our country needs. H.R. 478, the GI Bill STEM Extension Act of 2015 would give students who use the Post-9/11 GI Bill the option to apply for an extra nine months of benefits if they pursue a degree in one of the STEM fields.
Research shows the Servicemembers Readjustment Act of 1944, commonly referred to as the “Original GI Bill” returned $7 to the economy for every $1 spenton the program. Furthermore, many credit the Original GI Bill for producing 450,000 engineers, 91,000 scientists, 67,000 doctors, 22,000 dentists and more than a million other college-educated individuals. Our country stands to achieve similarly massive gains if we invest in STEM degrees as part of this proposal.
Consider the earnings over a lifetime of a STEM major versus that of a different major such as “teaching or serving” to understand the data behind the potential return on investment. In this scenario, it’s important to recognize the increased value that incentivizing and providing opportunity to become a STEM major would represent.
Georgetown University’s Center for Education and the Workforce (CEW)determined the difference in lifetime earnings between the lowest-and the highest-paying majors as $3.4 million. For example, CEW identified that a Bachelor’s degree in petroleum engineering pays a total career earnings of $4.8 million, while a Bachelor’s degree in early childhood education yields $1.4 million.
Typical career earnings increase over time, and split into three age categories: ages 25-34, 35-44, and 45-59. Each category is associated with potentially different tax brackets. Applying the associated tax brackets over the course of career earnings, STEM majors are expected to yield a net tax revenue for the government of $630,000 whereas other majors net $367,250. This difference in revenue totals to approximately $16.5B dollars returning to the economy when just 10% (roughly 90,000) veterans achieve a STEM degree over a different program.
CEW also notes that STEM majors’ wages grow more than other majors’ wages over the course of a career, increasing the wage gap between STEM and non-STEM majors (ref figure above). The greater tax revenue associated with STEM majors occurs due to the overall higher wages over a lifetime, and an individual’s entrance into higher tax brackets accompanied by increased earnings compounds that return.
When investing in veterans to seek STEM degrees, taxpayers would stand to double their investment—I like those odds. It’s time America made another smart investment in education.
This article is a follow-on discussion of the first post, "Speaking of Veterans and STEM...". If you’re a veteran interested in a STEM degree, or have an opinion on this proposal, I want to hear what you think. Comment below, or catch me on Twitter @hubbard_wj.