I’ve got a string of grandchildren about to run the college gauntlet. One is in college now, four will enter over the next eight years and two more will start after that.
So I, along with thousands of other parents and grandparents, have a real interest in higher education, 21st century style. An interest in quality, cost, graduate-school access, employment opportunities and, of course, earning power – the pot of gold at the end of it all.
College costs are through the roof. Think $35,000 to $50,000-plus per year, before loans and scholarships. Chances of getting into top-tier schools are very slim, one in ten or worse. And even if you are admitted, getting the major you want is not a slam dunk.
The entry process is beyond stressful. High-schoolers must get super grades, blow away the SATs, have eye-popping extra-curriculars and project a world-saving persona worthy of Mother Teresa.
With requirements like that, where do you start?
A good place might be the marvelous article just published in the Wall Street Journal by Eric Eide and Michael Hilmer of Brigham Young University. It’s the best two-page primer I’ve seen in a long time.
The authors, drawing on metrics from 7,300 college graduates, reported two major and rather surprising findings:
· In STEM fields (science, technology, engineering, math), the undergraduate school matters little. Graduates from mid-tier colleges earn just as much after ten years as graduates from elite schools.
· In business, social sciences and the humanities, the undergraduate school matters more. Prestige counts. Earnings are clearly higher after ten years if you graduate from an Ivy League school or the equivalent than if your degree is from a lesser college.
The most popular fields for today’s students are health care and education. The fields with the best job prospects are engineering, computer science, finance and accounting. (My collegiate granddaughter is combining engineering and finance. We’ll see.)
Eide and Hilmer drive home the point that students needn’t mortgage their futures to ensure good earnings. Engineering graduates make the same on average after 10 years – $135,000-145,000 – whether they come from a top-flight engineering school or a mid-tier college. The same applies for science majors, even computer scientists.
The take-home message: Don’t cut your wrists if you can’t get into MIT or Penn or Cal-Berkeley. You’ll do just as well in earnings with a science or math or engineering degree from a lesser school. And you’ll save a ton of money.
Even the flip side of the story – that the Ivies carry more weight in the humanities and social sciences – is encouraging. The authors found the differences in salaries after 10 years, while real, were not all that large, 11 to 14%. In education, the difference in earnings between the elites and less-selective schools was only about 8%.
Though not covered in the Eide/Hilmer study, an earlier survey showed that graduates who went on to obtain advanced degrees – J.D., M.S., Ph.D., M.D., etc. – all did well in terms of earnings regardless of their undergraduate school.
All of this says education is important, but where you get it may not be as important as we once thought. Good news indeed.