Category: Work

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Math for Grownups Math for Parents Math for Teachers Work

Engineering tops highest-earning degrees — again

With the economy still struggling along and a price of a college degree outpacing ordinary inflation, more and more personal finance experts are suggesting that students choose a major based on its earning potential. And true to form, this year’s American Community Survey data shows that STEM (science, technology, engineering and mathematics) degrees continue to promise much higher incomes than even business degrees. And so today, instead of interviewing someone about how they use math in their job, I thought I’d take a look at this data.

In 2011, 59 million Americans (25 years and older) held bachelor’s degrees. The most popular degree is business (20%), with education coming in second (12%). In fact, those with business degrees were the most likely to be employed. But here’s where the rubber hits the road: those with engineering degrees continue to out-earn business majors by about $25,000 a year (based on median salaries).

Yes, you read that right.

And the hits keep coming (again, based on median salaries): those with mathematics, computer science or statistics degrees earn $13,000 more each year, as do those with physical science degrees. Even if a STEM degree holder was not working in that humanities degree holders were (naturally) at the low end of the earning potential, along with education,

But money isn’t everything. Those in STEM careers are more likely be employed in full-time, year-round jobs. (Curiously, teachers aren’t considered year-round employees, which I think skews the data somewhat.) The mathy/sciencey types are also less likely to be unemployed.

I am not one to suggest that someone get a degree merely for the earning potential. If you don’t want to be an engineer, don’t major in that field. It sounds a little woo-woo, but I firmly believe in the general idea that we should all be following our bliss (and being smart about what that means financially).

Where I think this data matters — big time — is much farther down the educational ladder. Students who learn to love (or at least appreciate) STEM subjects are much more likely to consider these as a field of study. On the other hand, many of you can personally attest to the fact that it’s hard to fall in love with these subjects — and play catch up with the concepts and foundation needed to excel in them — when you’ve learned to hate them or have zero confidence in your abilities.

In other words, the work starts in elementary and middle school. For students reach their real earning potential and for employers to find qualified experts for the jobs that they do have, we really must make STEM a priority in these grades. That doesn’t mean more testing or introducing concepts at a younger age. (In my opinion, those strategies are counterproductive.) It means finding truly gifted STEM teachers who are able to motivate their students and overcome our epidemic of mathematics anxiety and general apathy towards the subject.  It means approaching STEM subjects with excitement and a sense of discovery. It means encouraging, not discouraging, exploration in these subjects.

So I ask you: What are you doing to help with this?

Interested in how things broke down numerically? Here are a few median salaries from the American Community Survey:

  • Engineering, $91,611
  • Computers, mathematics, statistics, $80,180
  • Physical and related sciences, $80,037
  • Business, $66,605
  • Literature and languages, $58,616
  • Education, $50,902
  • Visual and performing arts, $50,484

What do you think? Should college students choose a degree based on earning potential? Or should they “follow their bliss”? How can schools help students develop an interest in the fields that offer a higher earning potential? Share your comments!

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Math for Parents Personal Finance Work

Heading Back to Work: The childcare dilemma

Photo courtesy of D Sharon Pruitt

Every day, around the world, countless mothers (and quite a few fathers) are considering the same question: Now that my kids are older, is it time to go back to work?  The U.S. Census reported that there were 5 million stay-at-home mothers in 2010.  And the decision to forgo paid employment in favor of days filled with finger paint, potty-training and Mommy-And-Me playgroups is certainly rife with emotion and even debate.

It’s also very personal, and not just because these choices reflect our unique sets of values.  The decision to be a stay-at-home parent — or to return to work — is a financial one.

Let’s face it, if the family needs the money, going back to work sure beats sharing a one-bedroom apartment with three kids, a dog and a snoring partner.  Right?  But the math has to work out.

That’s because for many parents, returning to work means paying for childcare — and anyone who has done this knows it usually ain’t cheap.  The good news is that the math involved is pretty simple.  You just need to take a little time to work it out.

Jackie has three gorgeous kids, all under the age of 6 years old.  As the economy has worsened, her husband’s salary just isn’t going as far as it used to, and besides, she’d like to get back to her career as a pediatric nurse.  The doctor she once worked for called to see if she’d be interested in a part-time position at his practice.

Financially speaking, is this a good idea?  Let’s look at the numbers.

If she takes this position, she can earn $210 per day, after taxes, and she would be expected to work three days a week.  The practice doesn’t offer health insurance for part-time workers, but the family is on Jackie’s husband’s plan, so that’s a non-issue.  Other benefits are minimal, as there are no sick or vacation days and no retirement fund.  (She can switch schedules with another part-time nurse to cover any days she needs off.)

How much can she expect to earn each week?

$210 x 3 days = $630

Jackie can’t bring her kids to work with her or let them fend for themselves.  Nope, she’s got to think about laying out some cash for childcare, and like most folks, Jackie has a somewhat complex situation to consider.  Her oldest is in half-day Kindergarten, so she only needs part-time care for her.  But her three-year-old twins need to be looked after all day.  While her mom would love to watch the kids, the eight-hour commute to her house just isn’t practical.

Calling on friends and neighbors, Jackie considers her options.  Pretty quickly, her decision becomes clear.  Luckily, there’s a daycare center just around the corner from her daughter’s elementary school.  Even better, it offers part-time care.  And just down the street from Jackie’s house lives a woman who offers in-home care.  She places a few calls and learns that each place has openings.

Still, she needs to crunch the numbers.  The daycare center charges $50 per day, for part-time care.  The in-home caregiver charges $175 per week, per child.  How much of a hit will Jackie take in her take-home pay?

First, she needs to find the cost per week for her older daughter:

$50 x 3 days = $150

Next, she needs to find the weekly cost for her younger children:

$175 x 2 = $350

Finally, she adds the two together:

$150 + $350 = $500

So she can reasonably expect to pay $500 per week in childcare.  That means she’ll be taking home $130 each week.

$630 – $500 = $130

Yikes!  What looked like a great part-time salary is now looking pretty skimpy.  But there are two more calculations Jackie considers before freaking out: Her monthly and yearly take-home after childcare costs.

$130 x 4 weeks = $520 per month

$130 per week x 50 weeks = $6,500

These numbers tell her that she can contribute more than $500 each month to the mortgage payment.  Or if her husband gets that promotion he’s looking at, they could put almost $7,000 towards their savings.

There are also other financial benefits to consider.  For example, if Jackie keeps one foot in her career, she can get up to speed (and stay ahead of) changes in her field.  And if she’s already employed at the doctor’s office, she may be better positioned for a full-time job once the kids are all in school.

Now Jackie only has to deal with the emotional decisions — which are pretty tough.  But with these figures, she can at least say for sure how her family’s budget will benefit in the short run.

All you parents, what went into your decision to get back in the work force or stay at home? Did you do the math to figure out if it was financially worth it?  Or did the numbers show that staying at home was much more financially viable? Share your stories in the comments section.Save

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Math for Grownups Personal Finance Work

Leaping into Self-Employment (Hint: Math helps!)

Photo courtesy of shimelle

Deciding to leave a steady job with a steady income is a big step.  Leaving in favor of working for yourself might seem like the craziest idea of all.  Believe me.  I know from experience.

I’ve been a freelance writer for going on 11 years now, about half of that time while holding down a part- or full-time job.  But when my family decided to move to Maryland, I figured it was a good time to try freelancing “without a net.”  I didn’t have a job yet, but I did have a Rolodex full of great editorial contacts and a good understanding of how to build a freelance career.

Over the last six years, I’ve grown my business in many ways: from part-time to full-time, from focusing on journalism to writing a book and shifting my attention to curriculum development.  (I did the latter, when the bottom fell out of the magazine industry a few years ago.)

I can say two things about this experience: Math definitely helped me launch and sustain my new career. And I couldn’t have made the leap without the support and advice of writer extraordinaire and all-around generous gal, Linda Formichelli.

I met Linda when we were both starting out, but she was about a year ahead of me in the process.   These days, Linda is an accomplished writer with two books (The Renegade Writer and Query Letters that Rock), bylines from countless top-notch publications and a booming coaching business.

One thing that any experienced and successful freelance writer knows is this: The writing is secondary.  Sure, I’m in it to write.  But without some really good business skills, no one will hire me to do what I love.  In other words, we’re business owners first and writers second.  (And this is true for almost anyone who runs their own business.)

Unlike me, Linda doesn’t have a degree in mathematics.  (Her Master’s from Berkley UC is in Slavic Languages.)  Doesn’t matter.  Linda has learned to apply math to her freelance business.  First up: dealing with the bottom line.

“I needed to figure out my hourly copywriting rate based on how much I needed total to make a living plus the amount I needed for overhead — equipment, office supplies, etc.,” Linda says. “I divided that by the number of billable hours I predicted I would have in a year, and also had to keep in mind the going rates — what the market would bear.”

So no, Linda was not consumed with the kinds of pens she would use or scribbling by candlelight each night.  The practical won over the romantic.  Even with magazines.

“Magazines usually pay by the word, and I needed to figure out how that translated to an hourly rate,” she says. “For example, I sometimes make more money per hour writing for 50 cents per word versus $2 per word because the $2 per word articles are much more research-intensive and often required multiple rewrites.”

(I can’t tell you how important her last sentence is.  If a publication requires many hours of editing and rewrites — and some do — your hourly rate plummets.  This is part of what we freelancers call the PIA factor.)

Knowing how quickly she can write also helps establishing whether or not an assignment makes sense.

“I know that I can write about 800 words an hour (after the research and interviews are completed), so I can figure out how much time it will take me to write an article of any length,” she says. “For example, many articles run at around 1,500 words, so this will take me about two hours.”

Depending on what the client is offering, this may or may not be a good deal.  Here’s an example:

You’ve been offered a 1,500-word story assignment for your local alt weekly newspaper.  They’re willing to pay you $0.35 per word, and you’ll need to do four phone interviews.  You estimate that those interviews will take about an hour each, and you think you can write the story in two hours.  You’ve worked with them before, so you know you can count on about 1 hour of editing. Is the assignment worth it?  Let’s look at the math.

1,500 x $0.35 = $525

So if you do the story, you’ll earn $525.

4 hours (for interviews) + 2 hours (for writing) + 1 hour (for editing) = 7 hours

So you can expect to spend about 6 hours on the story in all.  (Notice, though, that there’s no time allotted for research or back-and-forth with the editor.  And you haven’t included any of the time you spent convincing the editor to give you the assignment.)

$525 ÷ 7 hours = $75 per hour

Now, maybe that’s a good rate for you and maybe it’s not.  Regardless, you now have a solid idea of whether or not you should take the assignment.

(If you’re not self-employed, you may be surprised by this rate.  But remember we self-employed folks are responsible for all overhead — equipment, facilities, health insurance, vacation and sick leave, taxes and retirement savings.)

And this works in all sorts of careers, whether you’re an artisan or have a landscaping business.  The math takes the guesswork out of business planning.  And it can keep you on track in any new business venture that comes your way.

If you are attending the American Society for Journalists and Authors (ASJA) conference in New York in April, be sure to check out my panel on math and writing.  I and two panelists will talk about how math is important in reporting and running a freelance business.  I promise it won’t be boring — and you’ll probably learn how to be a better reporter and business owner.  (Psst: Gretchen Rubin, author of The Happiness Project is the luncheon speaker!)

Hey freelancers (of all kinds): what’s your favorite math tip for running your business?  Share it in the comments section.

Categories
Personal Finance Work

Is Your Boss Ripping You Off?

In last Friday’s Open Thread discussion, Gretchen posted this question:

My husband’s company does not provide health insurance for me and the kids, which is a $12,000 value. In his field, there is a salary scale based on education, number of years experience, geography, etc. The salary scale assumes that the employer provides health insurance for the family. His salary is currently at 79% of the scale, and his employer wants to eventually get him up to 100%. But that doesn’t include the insurance, so it won’t really be at 100% and is not now really at 79%. But I can’t figure out which way to do the math so he can show them the actual percentage. They’re saying he’s at 79 percent. I’m saying it’s lower because they aren’t accounting for that $12K.

All of that boils down to this: What percent of the salary scale is Gretchen’s husband actually making, given that he, and not his employer, pays the $12,000 bill for insurance? There are two steps to this problem:

1. Find the actual salary that is at 100% of the scale.

2. Find the actual percent of Gretchen’s husband’s salary, minus the cost of insurance.

I’m going to tell you up front that we’re going to use a proportion here.  What is  proportions?  A proportion is two equal ratios.  So, if you have two fractions with an equal sign between them, you have a proportion.

And how did I know to use a proportion?  Well, my big clue was that we’re working with percents.  Percent means “per one hundred,” and per one hundred means “out of one hundred,” which just means, “put the percent value over 100.” In other words:

79% = 79/100

The tricky part is figuring out what the proportions should be.

Step 1:

salary/x = 79/100,

where “salary” is Gretchen’s husband’s salary, and x is the top salary on the scale.

That’s because the company assumes that your husband’s salary is 79% of the scale. (Notice this: “salary” and “79″ are in the numerators — or top values of the fractions.)

To solve this proportion, we need to plug in Gretchen’s husband’s salary and then solve for x. In order to make this easy to explain, I’m going to assume that his salary is $100,000.

substitute:   {$100,000}/x = 79/100 cross multiply:   {$100,000*100} = 79x simplify:     {$10,000,000} = 79x solve for x:     $126,582 = x

So if his salary is $100,000, the top salary on the scale is $126,582.

Step 2:

{$100,000-12,000}/{126,582} = p/100,

where p is the actual percent of the scale.

Let’s look carefully at this proportion: The first ratio is just the salary minus the cost of insurance, over the max salary in the scale.  (That’s what we found in step 1.)  The second ratio is just like the second ratio in step 1, except that we don’t know what the percent is.

Now, pay close attention to this.  Check the top numbers to be sure they match. We want to know the actual percent of the scale that Gretchen’s husband is making — and that’s what’s represented in the top number of each ration.

Check the bottom numbers to be sure they match.  Do they?  Why yes!  Yes they do!  That’s because $126,582 is 100% of the salary scale.

(Unlike my 10-year-old daughter’s outfits, math is very matchy-matchy.  Knowing that will help you organize your problems and check to see if they’re set up properly.)

Now all we need to do is solve for p.

simplify:    {$88,000}/{126,582} = p/100 cross multiply:     {$88,000*100} = {126,582p} simplify:       {$8,800,000} = {126,582p} solve for p:       69.5 = p

So what does this mean? If Gretchen’s husband makes $100,000 a year and is paying $12,000 for insurance, he’s earning 69.6% of the salary scale.

If you made it this far, you get a gold star!  Pat yourself on the back, and take the rest of the day off.  This is a complex problem that depends on an understanding of proportions and how to solve for a variable in an algebraic equation.

Never fear!  I’ll unravel some of these mysteries in later blog posts.  And of course, if you have a question, ask it in the comments section!

Categories
Home Math for Grownups Work

Math at the Permit Office (or Contractors Ain’t No Dummies)

If you’ve ever been to your city’s or county’s permit office, you can probably imagine how frustrated I was yesterday at around noon.  All I wanted was a demolition and construction permit for our newest renovation project.

Image courtesy of Ross Crawford

In my floral skirt and gold flip-flops (I had painted my toenails an hour earlier), I felt just a teensy bit out of place, among the blue-jeaned, unshaven contractors, who brandished rolled up blueprints and wore cell phones and tape measures clipped to their belts.. Still, I had my hand-sketched scale drawing and photos of the house as it looks now. As long as I could get the form filled out correctly, I was good to go.

But this was my second trip downtown in search of approval for our reno plans, and I was determined to get out of there with a permit this time.  That meant I was prepared to stay all afternoon — and go up to the counter as many times as I was asked to do.

This dude was in trouble. No scale drawing and no clue how to make one.

On my sixth visit to the counter — after completing the form three different times and calling my contractor once to clarify some measurements–I realized that I was just about home free.  The attendant asked me to add some notes to my paperwork, while she helped the next person in line.

This dude was in trouble.  No scale drawing and no clue how to make one.  The attendant gave him a quick lesson, along with a blank piece of paper and a scale ruler.  But it was clear that this guy was in for a long, long afternoon.

So, what is a scale drawing, and why is it important?

A scale drawing shows an object to scale. (Duh, right?) In other words, all of the measurements in a scale drawing are proportionate to the measurements of the actual object.  But making a scale drawing doesn’t burn up too many brain cells.  That’s because of three simple tools.

  1. Graph paper.  Each square on a piece of graph paper is 1/4 inches wide and tall.  So, if you define your scale as 1/4 inch = 1 foot, 10′ will be 10 boxes .
  2. Scale rulers: These are great if you don’t have graph paper, and you can use the same scale: 1/4 inch = 1 foot.  (See the picture above.)
  3. Computer programs: These translate your measurements into scale drawings for you.  But if you’re like me, it’s hard to visualize how to input the correct measurements.  I prefer to just make a drawing by hand.

Scale drawings are useful in lots of situations, but I’ve found them most helpful in home improvements and gardening.  (A quick sketch of my flowerbeds keeps me from overcrowding my begonias.)  And apparently, the city permits office wants to see them, too!

(Wondering if I got my permit? I can proudly say, yes!  And I know for a fact that my scale drawing helped.)

What math have you used in home improvements?  Is there a time when math got in the way of a home improvement project?