Treasure in Heaven: Returns to Schooling in Clergy Labor Markets

Abstract

Despite the status of religious organizations as major inputs toward nonprofit sector productivity in the United States, the study of the labor markets for clergy has been limited in the social sciences. One possible reason is that clergy are often considered to have low responsiveness to market forces; they are believed to follow a calling to a profession that has little regard for economic incentives. Even so, many congregations and denominations expect their clergy to be well-educated, with at least a bachelor’s degree and often a graduate degree as well. Such expectations raise questions about career alternatives for young people considering entering the clergy. With this paper, I join a growing literature that explores the financial incentives facing members of the clergy. Using cross-sectional U.S. Census Bureau data from 1950-2010, this research provides a descriptive study of clergy compensation relative to other occupations, examining changes in returns to schooling. I find significant statistical evidence that supports a higher rate of return to schooling for non-clergy overall, and an increasing difference between clergy and non-clergy returns over the sample period. Additionally, the data suggest that the clergy could be a substitute for schooling for less educated African Americans and that the rise of women selecting into the occupation could be partially explained by decreasing opportunity cost for female clergy.