Understanding Differences In The Value Of Post-Secondary Education Across Races In American Metropolitan Cities

We study the differences in value of post-secondary education among employers in the business field between whites and minority (African-American or Hispanic) races in USA. We will extend the study conducted by Deming et al. (2016) and also use a secondary dataset obtained from the same study. Deming et al. (2016) studied differences in the value of post-secondary credentials as measured by employer call-back rates, of which value is based solely on employer perceptions of the post-secondary institutions. In contrast, we will take a similar but narrower approach by studying whether the value in post-secondary credential differ across races. The authors constructed fictitious resumes that are varied by applicant characteristics and type of post-secondary institution then sent to real online job vacancies to obtain the differences in call-back rates across resumes. We will analyze two issues, firstly whether there are differential returns to post-secondary education between races when applying to jobs with the same educational requirement and secondly, whether across job with differing expected salaries differential callback rates exist between races. We found that among jobs requiring a bachelor’s degree (‘BA’), only a marginal difference in callback rates exist between races. However, among jobs with no post-secondary education requirement, there was a benefit for whites in obtaining a post-secondary credential. This finding is reinforced with whites receiving higher callback rates for being ‘overeducated’ than non-whites in jobs with certain expected salary ranges. Our study uses data from 2012 which allow us to study the progression of racial heterogeneity in education in the US through analyzing them within the backdrop of previous literature.