You're looking at a major tuition bill for the next four years and beyond. Like any investment, you're asking if it will pay you back. And not just you. Will it launch your child into a successful career? And by successful, you don't mean just satisfying and rewarding. You mean money.
You Get What You Pay For, Right?
Does a degree from a big name university directly relate to a better paying job? For what the Ivy League and other elite schools are charging, it had certainly better. When you're unable to retire and shopping at the discount grocery store, they'll soon tire of hearing that your kid went to Harvard.
A recent study by Contemporary Economic Policy combines research from the Brookings Institution, US News and World Report, the New York Times and other sources. It looked into the starting and mid-career salaries of students from “selective”, “mid-tier” and “less selective” colleges. You'll be glad (or dismayed) to find out that, in general, the selective schools do deliver better returns to their graduates.
But Not For All Majors
When the study looked closer at specific majors, however, it found that the trend was not universal. Students of engineering, science and other STEM majors did not see a major boost in earnings when graduating from an exclusive school. For example, an engineering student from University of Pennsylvania will earning an average starting salary less than $1000 higher than a Texas A&M student with the same degree. But the education from Penn will cost $167,000 more.
Business, education, social science and humanities majors at selective schools did earn 9-18% more in the middle of their careers than graduates of less selective schools. What's the difference? It could be that these fields are more social and less fact-based. Professionals benefit from a network of colleagues build by studying and working together. It's not what you know, but who you know. And entering a boardroom or classroom with the weight of a prestigious degree means more.
STEM fields have a body of common knowledge that doesn't care where you learned it. It's not who you know, it's what you know. Either you're qualified or you aren't. If you're an engineer building a bridge you need a grasp of physics, math and architecture. Your skill or shortcomings will be exposed whether you studied at Yale or Whatever U.
Of course, supply and demand must have something to do with the result as well, as STEM majors in general are in-demand in the job marketplace thus employers are less choosy about what school the graduate went to.
What Does This Mean For You?
Consider also the personality of your child. Some people naturally accumulate an entourage of helpful comrades. Others operate mostly alone, trusting only their own minds and hands for the job. If your student falls is the more gregarious type, he may benefit greatly by being around the best and brightest. He will graduate with a phonebook full of powerful connections. If he falls in the solitary group, he needs exposure to the knowledge but not necessarily the social network.
Overall, it will come down to the type of person your child is. Hard work yields results. A safety net of smarter and more diligent buddies will only float you so far. Plus, the quality of the college experience can't be simply qualified. Do your research, but also trust your intuition. And trust your kid. Send him somewhere he doesn't want to go and, no matter what the price or the statistics, he won't be successful.