So Long, Pricey Degree: Grads From These Schools Outearn Ivy Leaguers
Any parent of a college-bound senior, or student-loan applicant, will tell you that a bachelor’s degree is, typically, a five-figure investment that’s supposed to pay dividends in a bigger postgraduate salary. Yet any job-seeking grad who studied engineering or English literature knows that not all diplomas are created equally.
A new analysis of federal data, however, confirms that where that diploma comes from—and whether a student gets an advanced degree—can affect future earnings as much as the choice of undergraduate major, if not more.
Using information from the IRS as well as the Education Department’s College Scorecard, a new analysis from the Georgetown University Center on Education and the Workforce ranks more than 1,400 four-year colleges and universities across the nation based on the highest earnings of former students.
Titled Ranking Your College: Where You Go and What You Make, the analysis is designed as a guide for students and families preparing to make what is, for most, the investment of a lifetime. Yet the information is also intended as a pushback against spiraling college costs by helping families gauge whether a hefty student loan is worth it—and whether a graduate is likely to struggle when paying it back.
The groundbreaking analysis of federal and higher education information is ushering in “a new era of data transparency” in higher education, says Jeff Strohl, research director at Georgetown CEW. “It’s important consumer data with labor-market information on the outcomes of education” on “what [students] make or what they’re likely to make” within a decade of freshman year.
Strohl says some information is fairly obvious: Students who enroll in top-shelf schools known for math- or science-based disciplines—or who graduate from an exclusive Ivy League university—are reasonably likely to bring home lots of bacon over the long run.
When it comes to median earnings, graduates of the Massachusetts Institute of Technology, a school known for its STEM programs, are doing the best. MIT grads earn, on average, an annual salary of $96,000 within 10 years of enrollment. The Massachusetts Maritime Academy, which principally trains engineers and shipping crews, comes in second place. Its grads earn a median annual salary of $89,000. Harvard University, considered among the world’s elite colleges, comes in third with a median annual salary of $87,200.
The top three schools also underscore a problem with the data: Not everyone who goes in comes out with the skills, or the ambition, to make lots of money.
“It doesn’t say much about major choice,” Strohl says, noting that MIT has a robust liberal arts curriculum, some Harvard grads may decide to study French literature instead of finance, and a Massachusetts Maritime student could choose teaching over the high seas. “It doesn’t tell us a lot about variations or account for the mix of people who got into the school.”
In general, however, “you have a high likelihood of doing really well” with degrees or training from any of those three schools, Strohl says, an important factor to consider before breaking the bank to go to college.
After accounting for pure earning power, Georgetown CEW next examined which schools' graduates made the most based on academic major alone. When the salary numbers are adjusted for field of study alone, Harvard tops the list: Graduates earn $29,200 more than might otherwise be expected for that major. Georgetown University and the University of Colorado–Denver—an 18,000-student school— round out the top three in this category.
“The potential wages differ substantially for STEM and childhood education majors at midcareer,” according to a Georgetown CEW statement announcing the analysis. “This ranking adjusts for differences in the major composition of colleges’ undergraduate student population to provide a better sense of differences in institutional quality rather than in labor market returns of majors offered at different institutions.”
Graduate school also makes a difference, with advanced-degree holders earning 28 percent larger salaries than holders of bachelor’s degrees alone, according to the analysis. Overall, CU Denver students are more likely to bring home paychecks above their expected salaries “given their choice of major, level of academic preparation and likelihood of graduate degree attainment,” according to the analysis. Georgetown University and University of the Pacific take the second and third spots, respectively.
The analysis is available online and includes a search function allowing visitors to enter in their alma mater to see where it ranks.
While Strohl calls the analysis “an important step” by the government toward greater clarity when it’s time to pick a college, “a lot more needs to be done” to help students and parents understand which school delivers the most bang for the buck.
Going into serious debt for college is meaningless, he said, “if you’re not going to make enough earnings to pay it back.”