Home Forums College Rankings Ranking Colleges by ROI

This topic contains 2 replies, has 3 voices, and was last updated by  Frank Lauter 3 years, 11 months ago.

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    Hello everyone!

    Payscale.com has put together their college rankings based on ROI (return on investment) and the results shouldn’t be too surprising. If you select on-campus housing and “20 year net” for ROI type, Harvey Mudd and Caltech rank 1 and 2, respectively, whether or not you select “with” or “without” for financial aid. Overall, the STEM (science, technology, engineering and mathematics) schools ranked the highest followed by the Ivy League colleges.

    We’re big fans of these rankings and we certainly applaud Payscale.com for their work and effort to help make the college selection process more transparent. That said, there are a few things we want to bring to our readers’ attention.

    First, Payscale.com excluded graduates who went on to graduate school. This is certainly understandable as the graduate degree can have a tremendous impact on the graduates’ earnings potential and skew the results. However, there are a number of schools that send a very large percent of their graduates to graduate school and it could be argued that excluding these students only shows the ROI on that institution’s, shall we say, “underachievers.” For perspective, the percent of graduates who go onto graduate school within 5 years of graduating from Amherst College and University of Chicago is 90% and 85%, respectively. That’s a lot of graduates to exclude! We would also feel remiss if we didn’t remind our readers that the undergraduate institute does have an impact on the earnings potential of the graduate degree holder.

    Additionally, Payscale.com only included the schools’ graduates. So schools that may have deserved reputations as “party schools” can rank high since the ranking methodology doesn’t look at what becomes of the majority of students who eventually drop out (hint: multiple studies indicate their earnings potential is far below that of graduates) and only takes into consideration that minority of students who likely own the self restraint trait in spades.

    Finally, there are a number of schools with explicit missions to prepare their graduates for careers in lower-paying fields such as teaching and religious non profits. Obviously, these schools are going to claim that this ranking isn’t a fair evaluator of their performance.

    Best of luck with your applications!


    David Petersam
    AdmissionsConsultants, Inc.


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    This is very helpful as we start looking at colleges for our son. THnak you!


    Frank Lauter

    I agree. Great analysis. Thanks for taking the time to look into the methodology for allof us!

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