Does High School Math Affect Earnings? What Four Studies Show

Yes, more high school math goes with higher pay, and one Danish study suggests part of that gap is causal. Joensen and Nielsen (2009, Journal of Human Resources) used a school pilot that moved some students toward advanced math and found a causal link between that math and earnings for those students. A 2020 British cohort study by Watts found that age-16 math scores predicted earnings from age 33 to 50.

Raw gaps are large. They shrink once researchers account for other differences between students, and the causal evidence covers a narrower group than the correlations do.

Math that students can see the use of

The studies below are about math achievement and about taking more math, and they suggest that staying in the subject goes with higher pay. Our working premise is that students are more likely to stay in math when they can see what it is for. That premise is ours, and none of the studies tested it.

Rapunzl's curriculum includes a financial math course, and students manage simulated $10,000 portfolios with live Nasdaq pricing, where percent change and growth show up in the prices of companies they choose. No study here tests whether applied math changes who stays in the subject, and none evaluates Rapunzl.

Does more math go with higher pay?

In every dataset below, more math or higher math scores goes with higher pay. Watts measures test scores at 16, and the other three studies look at courses or qualifications. The gaps shrink once researchers account for other differences between students, so each study's design matters.

Watts reports the size of the link in percentages. For men working full time, a one standard deviation higher math score at 16 went with about 18% higher earnings at age 50 when nothing else was held constant. That falls to about 13% once reading is accounted for, and to about 9% once family and early-childhood measures from ages 7 and 11 are added. A one standard deviation gap is roughly the difference between a student at the 50th percentile and one at the 84th, if scores are bell-shaped.

The Cleveland Fed brief uses American data. Among full-time workers aged 20 to 30 who dropped out of high school, those who had completed geometry or Algebra II had a median hourly wage of $14.36, against $12.70 for those with Algebra I or less. Among graduates who did not attend college, workers with less math were about 50% more likely to be unemployed and earned about $1.30 less per hour.

Does the math itself raise earnings, or do ambitious students just take more of it?

That is the question the Danish study was built to answer. Students who choose advanced math differ from those who do not, so a raw earnings gap could reflect motivation or ability. The figures in this section come from the authors' 2006 IZA discussion paper, an earlier version of the published article, unless noted.

Before a 1988 reform, some Danish high schools ran a pilot that let students combine advanced math with advanced chemistry. Without it, advanced math came packaged with advanced physics, which the authors say scared away students who were otherwise interested in math. The share choosing advanced math rose from 21% to 35% at pilot schools. The authors report that students were spread across pilot and non-pilot schools as if at random, so the pilot works as a natural experiment.

The published abstract reports clear evidence of a causal relationship between math and earnings for the students induced to choose math, and part of the effect ran through those students getting more schooling. In the discussion paper, advanced-math students earned about 30% more than other graduates thirteen years after starting high school, and roughly 10% more after controlling for a large set of characteristics, including the education they went on to complete. Those are comparisons across all students. The pilot-based estimates stay positive but shrink when the authors control for how much schooling students ended up with, which fits the claim that part of the effect runs through education.

How does high school math lead to higher pay?

Education is one route. The Danish pilot-based estimates shrink once schooling is controlled for, and the Cleveland Fed brief shows a similar pattern in American data: among graduates with Algebra I or less, 50% attended college and, of those who attended, 13% completed a four-year degree. Among graduates with Algebra II, 68% attended and 40% of attendees completed.

Skills are another possible route. Joensen and Nielsen discuss logical reasoning and inference as skills that math courses could add, and they ask whether students with favorable traits simply choose math. They say the education effect may stem from changed preferences for the length and subject of education, or from improved skills to complete favorable educations.

What does this research leave open?

It does not show that every extra math course raises every student's pay. The Danish estimate applies to students who were induced to take advanced math by the pilot. In the discussion paper, it was measured thirteen years after starting high school, it comes bundled with advanced chemistry (the authors say they cannot separate the two), and the estimates do not support a causal effect on unemployment.

The correlations have limits too. Watts' sample entered the labor market about forty years ago, and the author cautions about generalizing to today. The Cleveland Fed piece is descriptive. It says unmeasured differences could play a part, though it judges that less likely when comparing similar groups of workers. And the evidence is not unanimous: Joensen and Nielsen describe earlier American work by Altonji (1995) that found a negligible effect of specific coursework, including math.

None of these studies tested whether making math engaging or applied changes anyone's earnings. They look at math scores or how much math students take, and they say nothing about how it is taught.

What should a parent take from this?

These steps are inferences from the findings, and none was tested as a family intervention.

• Keep math going when options exist. The pattern across these studies is about staying in the subject, so ask whether your child can continue to Algebra II and beyond before they drop it. The leap is ours: the Danish evidence is for students nudged into advanced math bundled with chemistry, and applying it to an American Algebra II decision is an inference.
• Ask how math fits with their other interests. The Danish pilot let students combine advanced math with advanced chemistry instead of the usual physics bundle, which the authors think made more of them willing to choose math. A school counselor can tell you what combinations your school allows.
• Give the math a purpose at home. Interest on a savings balance or the real cost of a loan puts the same skills to work. Our guide to teaching teenagers about money has everyday starting points, and our look at personal finance in middle school math shows how the two subjects connect. Rapunzl's financial math course builds the mathematical foundations of personal finance.
• Get help early in a hard year. Staying in math goes with higher pay in these studies, and nothing here says a student who finds math difficult should be written off.

If you would like your child to practice financial math through interest rates and budgets, see how Rapunzl works for families.

By Myles Gage, Co-Founder and Chief Executive Officer at Rapunzl.