Going to an Elite College Only Means Higher Salaries for Some Professions

How much will attending Ivy League and open-enrollment college affect your future income? Well, it depends on your specialty, according to a recent study published in Contemporary Economic Policy .

After analyzing a survey of thousands of college graduates and their salaries ten years after graduation, the researchers found that in some areas, graduating from a selective college does not make a big difference to future income.

Particularly for business and other liberal arts professionals, the prestige of the school has a large impact on future earnings expectations. But for fields such as science, technology, engineering, and math, it largely doesn’t matter whether students go to a prestigious, expensive school or an inexpensive one — the expected earnings are the same. Thus, families can waste money chasing expensive degrees in these fields.

This makes sense since STEM fields tend to be hired with an emphasis on acquired skills:

For potential employers, the skills students acquire in these areas seem to be more important than prestige, perhaps because curricula are relatively standardized and there is a generally accepted set of knowledge that students must learn. Thus, a student may not need to attend the best school to secure a good salary after graduation. (It is important to note that we controlled for a variety of other factors that can affect post-graduate earnings, such as family income, race / ethnicity, gender, marital status, SAT scores, postgraduate degrees and age at graduation, and more. )

Business majors, on the other hand, will benefit from connections made during college with potential employers and other graduates from more prestigious schools. Researchers found that for graduates of prestigious schools in business, education, and the humanities, graduates from prestigious schools are paid 6–18% higher than those of less selective or mid-tier colleges (based on Barron college rankings).

Good to know before investing in an expensive degree. For more help in choosing schools, try this tool that shows you the highest salary colleges in your area.

Where are you going or what are you studying? Relative Impact of College Selectivity and College Specialization on Earnings | Contemporary Economic Policy via The Wall Street Journal


Leave a Reply