As many undergraduate students continue to be burdened with more college debt, a collective unnerving fear associated with finding a high-paying job after graduation grows. It is a sentiment that rings loudly to prospective students and their parents, both of which are looking into college choices and applications. Have you ever wondered how much graduates actually earn after they get out of college?
According to a recent article from The New York Times, there is an increasing disagreement among “rankers” concerning how and which colleges they rank at the top, and much of that data is surprisingly based on earnings of graduates of each institution.
Payscale Inc.’s salary and compensation information database, for example, released its first college salary report back in 2008. Now, their reports are incorporated within Forbes and Money magazines’ process of ranking colleges. The Economist also uses graduate income during their initation into the field as a factor when rating universities.
Has the reward of a rich education been diminished to a single dollar amount?
The rankings of universities will likely change the landscape of higher education by making admission much more competitive for top schools. It’s not just PayScale or College Scorecard data either, but other sources also include factors that are not really about the quality of the education. U.S. News, for example, bases its rankings on selectivity and reputation.
Rankings released by The Wall Street Journal and Times Higher Education Survey are probably more reliable than the others, as 40 percent of their results are based on “outcomes”— earnings, graduation rate and loan repayment rate. The other 60 percent rates the school’s resources, student engagement as measured by student responses to a questionnaire, and “learning environment” or diversity.
While none of the rankings agree on the “best” college, Harvard and Georgetown universities are usually among the top 10. The ranking system isn’t bad, but still, it begs the question, how much you should spend on your education and will it return the investment? Once again, a business decision.
Results are more divergent in smaller schools, and underfunded schools are not really accounted for. Women’s and liberal arts colleges suffer even more in the rankings. Consider a venerable liberal arts college like Washington and Lee University in Virginia. It’s number one on The Economist’s list. Its graduates earn a whopping $22,375 more than would have been expected based on the characteristics of entering students. However, it ranks only 109th on the Wall Street Journal and Times Higher Education list, with an especially low score for diversity.
Women’s colleges are especially vulnerable when earnings data are incorporated. U.S. News ranks Wellesley College, Hillary Clinton’s alma mater, number three among national liberal arts colleges. It falls to number 30 on The Wall Street Journal’s rankings, and to number 201 on PayScale.
Yale University is an odd example, as it illustrates the lack of set standards in the ranking system. It is number 1 for outcomes in The Journal’s ranking, but in The Economist’s, it’s near the bottom, at number 1,270. The magazine estimates that a student attending Yale would earn about $10,000 a year less on average than one attending another college.
With so much data, are parents and students making more informed decisions? It should go without saying that the value of an education should never be reduced to purely monetary terms. But college is a major investment; students and parents should consult PayScale and the College Scorecard in order to understand the financial implications of their decisions.
No ranking is perfect, but The Wall Street Journal and Times Higher Education survey did a credible job blending a wide variety of factors, because there’s more to life than a high salary.
In the end, parents and students should consider all the different implications of going to a college, and it is up to the student, not the college, to dictate their future achievement.