The Major Question
Over the next few weeks, entering freshmen will take the steps necessary to continue their educational pursuits at colleges and universities across the nation. Most are looking forward to the unique challenges and opportunities they expect such an experience will provide.
Within the first month, they meet new people and make special friends, and many of them will be asked the same questions over and over. Specifically: What’s your name?, Where are you from?, What’s your classification?, and What’s your major?
The first three will be easy to answer and the responses will become almost automatic. The last one might take a bit more thought and, over the course of the year, could change dramatically as students become more aware of the various professions beckoning them today.
There are very few limitations on career possibilities if students properly prepare and sufficiently apply themselves. Sex, race, ethnic and social backgrounds, and even financial resources, are no longer barriers to future success and satisfaction in a chosen field. While there are some professions that would prove more difficult for the physically challenged, the doors are opening wider nowadays in many of those areas to allow exceptional individuals to realize at least part of their dreams.
Decisions regarding a major may sometimes depend on the popularity of a career field at the time or the prospects of employment and financial remuneration. Unfortunately, the popularity of majors does not always translate into something of significant value when seeking employment after graduation. Additionally, the career fields that have the greatest volume of openings do not always generate enthusiastic responses among students.
Many of those entering college for the first time have undoubtedly reviewed books, pamphlets, and specialized handbooks on the potentials of particular majors. Shortly after enrolling, some will inevitably encounter classmates eager to evangelize on behalf of their own personal career choices. The possibilities regarding how to spend the rest of one’s life can be overwhelming!
Some college students will remain firm in their first career choice and make every effort to fortify their decision by diligently applying themselves and fulfilling all prerequisites. Others will undoubtedly change their minds—and often lengthen their time in school—as they face daunting hurdles, discover greener academic pastures, or decide to explore avenues more closely associated with their innate abilities or aptitudes.
Many reputable sources survey undergraduates annually to determine the majors for which there is the greatest interest. Over the years, the list has varied with some fields gaining rapidly and others slowly slipping, tenaciously trying to cling to the top tier.
According to The Princeton Review, over the last few years, there are several majors that have held fairly steady in popularity. They include (in alphabetical order) accounting, biology, business administration and management, chemistry, communications, computer science, education, English, history, mathematics, nursing, political science, psychology, and sociology.
The most in-demand college majors according to the Job Outlook 2005 survey by the National Association of Colleges and Employers include accounting, computer and information sciences, economics, various engineering fields, and marketing-related areas.
Some of these fields could be considered “naturals” because of the current and perceived employment openings. Others might be surprises. For at least one—economics, I could say, “about time.”
As an economist and one who for more than a quarter century has analyzed, scrutinized, and categorized myriad economic-related matters (and that includes an almost endless number since practically every aspect of life has some economic facet), I have watched the number of students majoring in economics grow, particularly over the past decade.
At Harvard, economics is the most popular major. Last year, nearly a quarter of the entire graduating class at the University of Chicago received economic degrees. Columbia University has experienced a 67% increase in economics majors since 1995.
The attraction of economics is not just an American phenomenon. There is a growing interest in studying economics among college students around the world.
As the globalization of economies continues to expand and impact all societies, everyone will invariably be affected to some degree. Because of this situation, I would suspect that as college campuses begin to fill up and students face those time-honored questions, there will be many who give economics as the answer to the “major” question.
posted @ 09:47 AM CST [link]
Friday, July 22, 2005
On the Road Again
Texans have always been an unusual breed. Through the years, their mettle has often been tested. From the wild frontier days when numerous communities gained fame as Six-Shooter Junctions to today’s myriad technological challenges, Texans have faithfully demonstrated their capacity to master almost any situation.
Some aspects of life in the Lone Star State have been immortalized through various venues including movies such as Giant, which was filmed in Marfa 50 years ago, or books like Madison A. Cooper’s Sironia, Texas which also was popular about the same time.
And take the song, “Miles and Miles of Texas,” first produced around 1950 as a demo. Since its recording in 1976 by the group Asleep at the Wheel and used as a mobile phone ad in the 1990s, it has become solidified into the Texan psyche. Of course, the 1983 song “On the Road Again” has become synonymous with Abbott native Willie Nelson.
That song could be adopted as the national anthem by Texans during the summer months when millions of the state’s residents are on the roads and highways. Seemingly their travels are a way of saying “Don’t Fence Me In,” or a means of expressing their resolve to enjoy the stars at night, which are big and bright, deep in the heart of Texas.
Okay, enough romanticizing with musical lyrics. All of this is to simply reinforce the fact that Texans are passionate about a lot of things. One of which is the freedom to travel. Over eight out of every 10 families that take a vacation this summer are traveling by private vehicle.
The amount of money necessary to fill the gas tank does not seem to be a determining factor in most people’s decision to take trips. Across the US, more than 328 million leisure excursions are projected to occur this summer. About the only thing that is slowing our driving seems to be the traffic congestions at some of the favorite tourist destinations.
The national average cost for a gallon of gasoline hit a record high this month of $2.33. It might have gone even higher if Hurricane Dennis had moved further westward and disrupted the oil operations in the Gulf of Mexico. I suppose we can take some consolation from the knowledge that this high price is still below the inflation-adjusted price of $3.03 per gallon in March 1981.
Summer driving, in which we are now in the midst, is predicted to be 2.3% higher than last summer. Most Texans do not intend for that projection to be restrained to any significant degree because of the expense of gasoline.
Texas has nearly 80,000 miles of farm-to-market, ranch-to-market, Interstate, US, and state highways—more than any other state. On top of that, there are 300,000+ miles of municipal and rural highways.
Over the next few weeks, most of these roadways will have been used by Texans taking leisure trips to see friends or relatives; shop; attend a cultural, athletic, or recreational event; visit one of the state’s more than 1,000 parks, campgrounds, or preserves; or just tramp around some of Texas’ 250 ghost towns.
For Texans, being “on the road again” is almost like a guaranteed freedom or an inalienable right. We have come to expect and enjoy it, regardless of the dent it makes in our pocketbooks.
posted @ 09:46 AM CST [link]
Friday, July 15, 2005
Baby Boomers—Planning for the Future
Remember the adage about the 80-year old who tells a friend that if he had known he would live so long, he would have taken better care of himself. With Americans’ life spans increasing, that sentiment is probably being repeated more often nowadays than in years past.
A corollary to the maxim about physical well-being at an older age relates to economic health—“I just hope my money lasts as long as I do.” Though many people say it jokingly, as baby boomers are beginning to come of age this month, the concern may become more prevalent with each passing year.
Between 1946 and 1964, there was a significantly high rate of births in the US. Those born during this time are usually referred to as baby boomers. Over that 19-year period, the population of the nation increased some 36.44%, and the number of people living in the Lone Star State expanded by 42.70% to add more than 3.07 million and reach approximately 10.27 million. Today, boomers make up around 13.37% of Texas’ 22.96 million residents.
Now composed of middle-agers, the boomer generation plays an important role in sustaining our economy because of its buying power, especially since consumer spending accounts for about two-thirds of the nation’s overall economy. Boomers are particularly significant to the home furnishings and equipment sectors and to the automobile industry.
Among the reasons they purchase so many cars may be the need to facilitate the transportation requirements of their teenage children at home with driver’s licenses as well as their children away in college. I can attest to this assumption based on personal experiences with my five children. To test the validity of this concept yourself, just look at any high school or college parking lot or check out the teenagers vying for parking spaces at the malls.
Another aspect of the economy in which baby boomers are beginning to excel relates to expenditures for medical services. Over the next 25 years, America will turn much grayer as nearly one in five will be at least 65 years of age. Currently, fewer than 12% are at that time in life. As each year passes and boomers grow older, healthcare requirements are anticipated to continue to expand. Meeting those needs will often fall to various state-funded and private organizations.
While future medical needs are probably on the minds of many men and women born between 1946 and 1964, a subject of perhaps even more prominence relates to impending retirement.
This is true especially because this month baby boomers are coming of age, at least those on the leading edge of the generation. Federal law allows those who turn age 59.5 to withdraw from their 401(k) and IRA accounts without the 10% penalty formerly required of such removal of funds. The first boomers passed that milestone this summer. While most will not elect to withdraw funds, they now have the opportunity.
According to a recent survey, the majority of boomers hope to acquire a new house for their retiring years. They also are looking forward to enhancing their lifestyles as a result of their greater ability to travel, having more time to spend with family, or increased capability of moving to a warmer climate. Texas was one of the top five states to which retirees anticipated immigrating.
While some boomers are planning on getting a rocking chair and sitting on the porch to watch life go by, many others are mapping out ways to remain active—from continuing to work full or part time past the traditional retirement age to moving into a retirement village full of amenities conducive to increasing physical exercise and enhancing their social lives.
Preparing for better physical and financial health is something to which we all need to give more consideration, and it’s never too early to start. As a baby boomer myself, I guarantee it!
posted @ 09:45 AM CST [link]
Friday, July 8, 2005
Video Competition
Cable television dominates the market for delivery of video programming. While satellite television and other cable companies offer services in some of the same markets, there is substantial evidence of a lack of effective competition with cable television in Texas for the delivery of video programming. The way you can tell is quite simple—prices go up, quality doesn’t, and people keep buying it.
One way to fix this market shortcoming is to implement public policy facilitating the provision of video services by telecommunications companies. These firms have wire connections throughout the state and have the technical capability to provide video (much as cable operators are now able to provide telephone service). The result would be substantial investment in the state, expanded operations, and notable consumer savings. All of these factors lead to a significant economic stimulus, as well as incentives for innovation, improved quality and services, and more flexible product offerings.
My firm was asked to quantify the effect of increased competition in video programming in Texas. The study reveals that policies to support increased market entry and participation by telecommunications firms will generate substantial investment; more than $1.8 billion in ongoing annual spending; almost 12,000 permanent jobs; and better service, quality, and consumer choice.
Competitive markets create efficiency and enhanced individual welfare. Just look at trucking, airlines, natural gas, telecom, or any of the other markets that once were regulated and now are open to competition. Because the market for video programming is not competitive, several problems arise. The market power of cable television operators is evidenced by their ability to raise prices faster than general inflation while offering relatively poor service. Only the presence of another wireline competitor appears to effectively constrain this capacity. Unfortunately, wireline competition is not widespread, and many markets in the US and Texas have no practical choice for video programming. While satellite offers an alternative for some subscribers, functional differences between satellite and cable reduce satellite television’s ability to compete effectively. Furthermore, satellite television appears to be more of a niche product that is targeted to rural areas and high-end users of sports channels.
The existing market structure in the cable television industry provides a significant competitive advantage for cable operators. Cable operators have the unique ability to provide a bundled package of video, high-speed Internet, and telephone services from one provider through existing technology that is readily available and familiar to most households. Furthermore, the large incumbent cable operators are vertically integrated, with ownership interests in many of the most popular cable television networks (in part or whole). While cable television market penetration has declined slightly in the past few years, the industry continues to prosper, with revenues and profits increasing yearly. The cable television industry is also poised to reap significant profits without adding new subscribers from the array of digital services now offered (digital cable and telephone and digital high-speed Internet).
The ability of cable companies to exploit this market power to the detriment of consumers can only be meaningfully limited by facilitating the entry of other wireline providers. At present, a cumbersome and inefficient market entry mechanism precludes substantial and rapid investment by other wireline (primarily telecommunications) providers, particularly in Texas. Streamlining this process and introducing effective competition yields numerous economic benefits as noted above.
Competition is the hallmark of the American economy and the ultimate source of efficiency and consumer wellbeing. Public policy which promotes market entry is beneficial to the economy in multiple ways. Nowhere is such an enlightened approach more needed than in video programming services. Our analysis reveals that cable telecommunications operations face little or no effective competition, and are able to consistently raise prices despite offering poor service performance (as measured by independent surveys) and limited consumer choice.
In addition to the enhancement of consumer choices, encouraging penetration by telecommunications providers would also bring a substantial stimulus to business activity and fiscal revenues. Moreover, it would accelerate broadband deployment and infrastructure investment, thus enhancing the prospects for economic development. In short, promoting competition in video programming services is a significant opportunity for Texas to enhance its role as a viable participant in the technological economy of the future, while failure to do so will limit potential prosperity.
posted @ 09:44 AM CST [link]
Friday, July 1, 2005
Travel and Tourism
What four words will young children likely be saying the most this summer—at least those who get the privilege of traveling around Texas? Go ahead, take a guess.
Although there is no scientific study to verify it, most adults who take their children on family outings would probably agree that the most overused phrase is, “Are we there yet?” I well remember the car trips we used to take when our children were young. That question seemed to be repeated more often than any other. It’s so well used that Hollywood even made a movie recently with the phrase as the title.
Thousands of families will be traveling across the Lone Star State this weekend as our nation celebrates Independence Day. Even with gasoline prices near record levels (averaging about $2.10 per gallon—up some 30 cents above this time last year) and not projected to see much of a drop in the coming weeks, the highways are still expected to be full of people seeking to enjoy many of the things Texas offers.
From the 600 miles of coastline to the 600 varieties of birds found in the state, there is so much to do, it can boggle the mind. As the Economic Development and Tourism office proclaims, Texas IS really like a whole other country. When the kids ask, “Are we there yet?” you can answer “yes,” and stop practically anywhere to enjoy what the state has to offer.
Texans have always considered themselves a bit different from those who live in other states. Until Alaska became a part of the Union in July 1958, we could claim we were the biggest. Even though we lost that crown, there are many other areas in which we excel and about which we can boast.
One of which is the amount of business and leisure travel we experience each year. Tourism, including both travel to and within Texas, is a highly important aspect of our state economy. About one out of every 20 people employed in Texas works in the travel industry.
Nearly half of them are in the accommodations sector, with food service, arts, entertainment, and recreation providing about 21% of the jobs. Transportation segments involve nearly 15% of those employed in the travel industry, and retail sales account for a little over 14%.
During the first quarter this year, hotel/motel revenue increased 5.9% over the average amount generated for all of last year. The occupancy level in the 3,700 facilities located in the metropolitan statistical areas increased 2.2%, which reflects a 56.7% occupancy level compared to a 55.5% average in 2004.
Why do people travel in Texas? Business responsibilities generate a significant amount, but leisure activities—a trip of more than 50 miles from home—account for 71% of the trips to and within the state. Over a third travel to visit friends or relatives and another quarter get on the road just seeking a little time away from the daily grind.
Among the most popular reasons people give for traveling in Texas are dining, shopping, sightseeing, general entertainment, and beach/waterfront activities. According to a recent survey, the top spot visited by Texans is the San Marcos Outlet Mall, while for out-of-staters, it’s the Alamo.
Travelers this weekend will probably be focusing on picnics, parades, and fireworks, which seem to get the greatest amount of publicity and are among the most popular celebratory activities at this time of the year. Over the next few weeks, the tourism season will continue to blossom and soon sightseers and shop-till-you-droppers will be in full bloom all across the state.
It will be a beautiful sight, especially for our economy.
posted @ 09:43 AM CST [link]