ROI of Elite Colleges
4 Major Takeaways from The Wall Street Journal’s Article on ROI of Elite Colleges
This week, the WSJ posted an article on the long-term financial benefit to elite college degrees. The article quickly gained traction; it circulated on education blogs and social media with great speed.
For years, as application numbers show, students and parents have chased degrees from prestigious schools as a kind of “success insurance plan.” They reason, as the WSJ explains, “The more prestigious the school you attend, the higher your salary will be after you graduate.”
This article examines whether or not this belief is true. Here, the college admissions experts at Stratus Prep break down this important article to explain what it means for you.
The reporters surveyed 7300 college grads 10 years post-graduation.
Majors were divided into:
- social science
Schools were divided into 3 admissions categories:
- less selective
1. The article focused on “skills v. prestige.”
They noted for fields like engineering there is no significant difference between the earnings of graduates from more and less selective schools. This is because the skills learned to excel at these careers are fairly standardized. This leads the authors to the to the conclusion that a student may not always need to attend the best possible school to attain a good salary after graduating.
2. However, elite degrees do increase earning for certain careers.
Ivy League and similar top schools will especially aid in your career in liberal arts fields or with admission to graduate school. For example Business students from the most selective colleges earned 12% more than students from midtier schools and 18% more than students from less selective schools.
Similar is true for education and humanities majors. As we note to all our Stratus Prep clients, elite schools will provide networking connections and professors who are leaders in the field. These key differentiators contain legitimate value.
3. Impact of an elite degree on salary depends on your industry.
For education, business and other liberal arts fields, prestige of the school has a major impact on future earnings expectations. But for industries like science, technology, engineering and math, it doesn’t really matter whether students go to a prestigious school or not.
4. Financial aid is not factored.
It is important to note this article conflates a “prestigious” with “expensive” school. That is misleading. 60% of Harvard students receive financial aid and every single Ivy League college offers complete tuition remission for families with income less than 60-125k (Depending on the specific school.)
It’s not just the Ivy League, top academic schools like Vanderbilt, Rice, UChicago, and Duke are all among the top 10 schools with the most generous financial aid. In fact, all 10 schools are in the top 50 U.S. Colleges.
Takeaway and Recommendation
Apply to a range of schools to give yourself options. Evaluate ALL the numbers: financial aid, tuition, cost of living, post-grad earnings in your field—before deciding where to attend.