Scientists Working Outside Their Fields Are More Likely to Become Entrepreneurs

After spending years and significant financial investment to earn a university degree, why do people take jobs outside of their field of study? The lack of jobs in their area of education must have forced these workers into a mismatch, right? At least, that’s what many people assume. But this is not the full story. To be sure, labor market conditions are important. Yet even in STEM fields where unemployment rates are low, many highly trained scientists still work in jobs outside of their field of education.

Why do workers end up in such situations? What are the implications for their earnings, job satisfaction, and long-term career prospects? How common are such educational mismatches? These are important questions for employers, workers, and policy makers.

My coauthor and I set out to find some answers, particularly for science and engineering. In our research paper, which was published in Organization Science, we used survey data collected by the National Science Foundation and analyzed the responses from more than 25,000 U.S. scientists and engineers with undergraduate, master’s, or doctoral degrees in science and engineering. We found that over 10% of the people in our sample reported working in a job field that did not match their field of education. Over 30% of the people in our sample reported that their job was only somewhat related to their field of study.

Two results were especially surprising and offer important insights. First, just 22% of the respondents reported a mismatch due to not being able to find a job in their field. Thus, at least three out of four actively choose to work in a different field, offering new insights into why so many people trained as scientists and engineers don’t work as scientists and engineers. Second, people who are mismatched for voluntary reasons are nearly 50% more likely to become entrepreneurs and start their own businesses.

Maybe educational mismatch is not as bad as it sounds.

There are different reasons for these voluntary mismatches. For example, scientists or engineers may decide to switch into different fields with higher salaries, better working conditions, or more flexibility. Similarly, some people move from technical to managerial positions in order to advance in their careers. Those jobs often demand less technical knowledge but can offer more pay, more responsibilities, and chances to develop new skills.

Scientists and engineers may also take such jobs because they have lost interest in their original field of study. Even if the new job does not pay as much, it may offer new challenges or feelings of accomplishment or advancement. Workers may also take mismatching positions for family reasons or because they prefer a particular location. In our sample, 31% of people who are mismatched did so for pay or promotion reasons, 24% switched for a career change, 7% for a specific location, 6% for better working conditions, 6% for family reasons, and 4% for other reasons. Those who choose a mismatch for career or personal reasons still report lower job satisfaction than those whose work is related to their degree. However, we find that both salary and job satisfaction are significantly higher for employees who are mismatched “voluntarily” than for the 22% who could not find an adequate job in their field.

It turns out that mismatches have benefits for workers. Our research found evidence that these employees are better positioned to acquire new skills and knowledge. Workers who chose to be mismatched for salary, career, or personal reasons were far more likely to be engaged in a broader range of non-R&D activities, such as finance, marketing, and management. (Those whose degrees matched their job field are more likely to focus on R&D.)

Interestingly, prior research has argued that having a broad range of technical and managerial skills may be beneficial for entrepreneurship. Entrepreneurs must be jacks-of-all-trades in order to perform the many different tasks required for running a new business, even if they can sometimes rely on cofounders to take over some of these roles. So people who take a mismatched position voluntarily may develop new and different skills that may make them better equipped to be an entrepreneur.

Our research gives some evidence that this may be true. We find that workers who are mismatched in their current jobs are more likely to leave their employer. Those who are mismatched for voluntary reasons are particularly more likely to move into entrepreneurship. Another possible reason for this higher rate of entrepreneurship is opportunity costs. With lower salaries and job satisfaction, the mismatched employees have less to lose by quitting their jobs and starting their own businesses.

These results have important implications for managers and policy makers. Our research underscores the value of hiring workers to jobs that fit their STEM educational backgrounds. Mismatched employees are likely to be less satisfied with their job, which can make them less productive. Moreover, mismatched employees are more likely to move to other firms or start their own businesses. Such mobility can have negative consequences for their current employers.

But it’s not necessarily bad for the economy. Our results offer insights to policy makers looking to encourage technology entrepreneurship among scientists and engineers. The population of workers employed outside STEM fields may be an overlooked recruiting ground. In general, scientists and engineers employed in their fields have specialized skills and may not have the diversified skill set to launch a successful business. Perhaps universities should expand curricula to teach STEM students nontechnical skills that are particularly valuable in entrepreneurship.

Finally, our results offer a new perspective on the ongoing debate on the oversupply of highly trained scientists. Research shows that only a relatively small share of the respondents works outside STEM fields due to labor market conditions. Even so, they report markedly lower salaries and job satisfaction. It may be important to help prospective STEM students assess labor market conditions and understand labor demand as they choose their areas of training. Our results suggest that students who make the “right” choice when enrolling in a program are likely to have better work outcomes such as salary and job satisfaction than those who switch into different fields after graduation.

Source: Harvard Business Review (Link)

Author: Briana Sell Stenard is an assistant professor of management and entrepreneurship at the Stetson School of Business and Economics at Mercer University. Her research agenda lies at the intersection of management and entrepreneurship with a primary focus on the role of human capital in shaping entrepreneurial entry, performance, and exit.

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