The impact of double majors during economic downturns

Are college graduates with two majors less likely to suffer disruptions to earnings than those with a single major? In “Do double majors face less risk? An analysis of human capital diversification” (National Bureau of Economic Research, Working Paper 32095, January 2024), authors Andrew S. Hanks, Shengjun Jiang, Xuechao Qian, Bo Wang, and Bruce A. Weinberg find that double majors had a substantial protection against negative earning shocks (pay cuts or job losses) compared with those who had a single major. According to the researchers, students who attained a double major in college have more financial resilience during economic downturns and experience a 56 percent reduction in the impact of income fluctuations compared with those with a single major.

The researchers suggest that while single majors may feel the full brunt of wage declines, those with double majors are better protected. The study also highlights differences between students who choose majors in unrelated fields and those who major in two related fields (such as two social sciences). For those with majors in unrelated fields, protection against earnings shocks was nearly 64 percent, while those with related majors only saw a 36 percent reduction compared with single majors.

The authors also examined data from the American Community Survey conducted by the U.S. Census Bureau. In the dataset, with data from 2009 to 2019, 10 percent of the 145,826 participants had double majors. Among all double majors in the surveyed group, 70 percent chose unrelated fields. According to the authors, the advantage for double majors appears to be that they have more diverse skills and knowledge sets.

Diversification becomes evident in several ways in the findings. For example, double majors are less likely to work in occupations that are closely related to their majors. Similarly, they are more likely to work in jobs that require a diverse set of skills and knowledge. The researchers suggest that people who have a broader range of knowledge and skills are more valuable to employers. Diversifying skills and knowledge make double majors more adaptable and more appealing to employers. This versatility can make them more resilient to shifts in the labor market.

The authors found that the primary benefit of holding a double major is not necessarily higher earnings, but rather a stronger safeguard against income loss. Further analysis using the National Survey of College Graduates data reinforced these findings by suggesting that the advantages of a double major extend beyond the inherent talents or interests of people who opt for a double major.

Finally, Hanks, Jiang, Qian, Wang, and Weinberg suggest that universities can aid students in broadening their skill sets by promoting cross-departmental collaboration and offering career guidance that emphasizes the importance of a diverse academic background. They stress that acquiring a wide range of skills and knowledge can be a valuable strategy for navigating the uncertainties of the job market.