Inside Higher Ed
By reclassifying their economics programs from “Economics, General” to “Econometrics and Quantitative Economics,” United States colleges can augment employment opportunities for international students and thus attract more talented students to the study of economics.
Since the mid-twentieth century, students from around the world have flocked to the United States to study at one of the nation’s myriad colleges and universities. Attracted to the wide variety of degrees, diverse student bodies, and residential campuses, international students attend the majority of the 4,583 American institutions of higher education. These foreign students perceive the benefits of a US degree as greater than the immense costs necessary to obtain it. In economic terms: the utility they obtain from the degree warrants the opportunity cost of the tuition.
International students may reside and study in the United States if they hold an F-1 visa. In order to obtain such a visa, individuals must apply at an American embassy or consulate and be sponsored by the college or university to which they have been accepted. F-1 visas only grant eligibility for non-immigrant student status, which does not permit students to work off-campus.
After graduation, it becomes far more difficult to secure legal residency. International students must leave the United States sixty days after they graduate unless they have been approved to stay and work under Optional Practice Training (OPT) programs. Through US Citizenship and Immigration Services (UCIS), F-1 students can apply for OPT in order to remain in the United States for twelve months of temporary employment in their academic field of study. After these twelve months, OPT employees must apply for H-1B work visas under the sponsorship of an employer.
The H-1B visa program was established under the Immigration and Nationality Act of 1965. Intended to attract skilled workers, this program allows US employers to hire foreigners in specialty occupations that require theoretical, practical, and specialized knowledge. For fiscal year 2019, Congress mandated a numerical limit of 65,000 visas.
According to US News, 1,078,822 international students matriculated at United States colleges and universities during the 2016-2017 school year. If all were to apply for H-1B visas in one year, only six percent would be successful. Therefore, the competition is intense, and the stakes are high for international graduates. During the year-long OPT program, these individuals must find an employer who is willing to sponsor them through the arduous process of obtaining an H-1B visa. With only a year of experience in the American workplace, it is difficult for foreigners to establish a strong relationship with their employer, a factor that is necessary to gain a competitive edge in the visa application process.
International students who have earned degrees in STEM—science, technology, engineering, and math—fields, however, have a significant advantage because the law enables them to apply for an additional twenty-four months of OPT employment. These two extra years provide STEM majors with more opportunities to find suitable jobs and connect with employers who will sponsor their permanent residency. Likewise, this allows them to enter the H-1B lottery three times, during three separate fiscal years, instead of just once. As a result, 90% of H-1B applications are for STEM related jobs. In contrast, many students in the humanities find it difficult to find employers who are willing to sponsor them.
Given the visa advantages of STEM majors, many international students are attracted to these fields and opt not to pursue others, such as the social sciences. Consequently, many economics departments at United States institutions are reclassifying their programs as STEM fields to make them more attractive to international students. While the US Department of Education and US Department of Homeland Security consider “Economics, General” to be a social science, “Econometrics and Quantitative Economics” is classified as a STEM field. The latter form of economics is technically more math and statistically focused than general economics, yet most collegiate economics departments can easily adjust their degree descriptions and requirements to meet these standards. By changing the federal classification code of degrees from “Economics, General” (45.0601) to “Econometrics and Quantitative Economics” (45.0603), colleges can qualify international graduates for STEM OPT extensions. This modification provides two extra years of employment and earnings and simultaneously increases students’ chance of gaining H-1B status.
Reclassifying economics programs will enable United States institutions of higher education to attract more international students who are interested in this field. Consequently, American economics departments will draw in more talented individuals who might later enter the US job market in correlated careers. The expansion of H-1B visas for foreigners working in STEM has benefited this aspect of the American economy. Therefore, augmenting opportunities for foreign students to gain employment in economics related fields might similarly create financial success in the United States.