Which colleges offer the best return on investment? A new study that examines graduates' earnings during the first 20 years of their careers has uncovered surprising results, Kim Clark writes for Time.
Researchers from PayScale.com calculated the average increase in earnings for graduates from different colleges, compared to workers with only a high school degree. The analysis accounted for the cost of tuition, and only tracked salary increases for students who successfully graduated. Those who went on to obtain additional education were also not tracked.
The schools with the greatest return on investment were prestigious tech-focused institutions, such as the California Institute of Technology, Harvey Mudd College, and the Georgia Institute of Technology. Graduates from those schools made $677,000 more during the first 20 years of their careers than workers without a degree.
Graduates from the Ivy League were a close second, with an average earnings boost of about $650,000.
The third group of colleges with high ROI was also surprising, say researchers. Colleges on Princeton Review's so-called top "party schools" list provided an earnings boost of $354,000. Colleges in the group include Syracuse University, Pennsylvania State University, and the University of Florida.
Lydia Frank, spokesperson for Payscale, recommends not taking the "party school" label too seriously. "That was just a fun comparison and kind of surprising," she says.
Scott Carrell, an economist at University of California, Davis, suggests that students who avoid distractions and graduate from a "party school" have developed self-control and support networks that serve them long after graduation. He also questions the methodology used by Princeton Review in identifying the "party schools."
On the lower end of the spectrum were liberal arts and music schools, which increased earnings by $200,000 and $128,000, respectively.
Beyond salary data
Experts caution that the rankings miss a big part of the return on investment puzzle: graduation rates.
Why employers love liberal arts graduates
Schools with lower average earnings could actually still be a great value if they successfully push more students to completion. For applicants considering different schools, the raw salary data does not tell the full story because "you don't know if you will be the one who drops out," he says (Clark, Time, 3/5).
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