A new report from Georgetown University’s Center on Education and the Workforce (CEW) sheds light on wide variation in the first-year earnings of graduates across various degree programs, institutions, and levels of postsecondary education.
The research draws on data from the Department of Education’s College Scorecard, which now includes previously unavailable data on how much graduates earn across 37,000 college majors at 4,400 institutions; the scorecard also shows the overall level of federal student loan debt and monthly loan payments for those majors and schools. “This kind of consumer information is just becoming available, and we hope it will help consumers make better decisions,” said Anthony P. Carnevale, lead author of the report and CEW director.
A case for digging into the details
CEW’s analysis reveals that, while graduates from more selective and well-known institutions typically earn higher wages, that isn’t always the case—especially for degrees in high-demand fields such as STEM and nursing.
For example, Inside Higher Ed points out that, when looking at four-year degrees in business administration, management, and operations, graduates who earned their bachelor of applied science in energy management from Bismarck State College in North Dakota earned the highest postgraduate salaries in their field ($100,500), surpassing graduates of degree programs at Harvard and Stanford universities. At the other end of the spectrum is Mitchell College, where graduates with a bachelor’s degree in business administration have first-year median earnings of $20,900.
There’s wide earnings variation by major at every level of postsecondary education, notes Education Dive. For instance, alumni of LaGuardia Community College in New York who earned their associate degrees in nursing had a median annual salary of $60,200 one year after graduation; meanwhile, graduates of Northern Virginia Community College’s associate business degree program earned a median annual salary of $31,300 in their first postgraduate year.
Field of study a key factor
“Future earnings can depend more on the major pursued than on the level of the degree,” the report says, noting that “in some cases, a worker with an associate’s degree can earn as much as someone with a graduate degree.” In their first postgraduate year, 27 percent of workers with an associate’s degree earn more than the median first-year earnings for workers with a bachelor’s degree.
The same dynamic plays out for higher levels of education: 35 percent of workers with a bachelor’s degree earn more than the median earnings for those with a master’s degree, and 22 percent of workers with a master’s degree earn more than the median annual salary of workers with a professional degree.
CEW’s report also explores student debt levels, finding that students’ monthly payments don’t necessarily increase with attainment level. In some cases, graduates from associate degree programs end up with higher student loan monthly payments.
Factoring in debt is important, says Martin Van Der Werf, a co-author of the report, adding that “graduates from programs with low first-year earnings and high monthly student loan payments will face the most challenging financial situation after graduation.”
Offering an example, CEW calculates that first-year graduates from Harvard University’s master’s program for theological and ministerial studies have $2,465 a month ($29,600 per year) in earnings after factoring in debt—far less than first-year graduates with an associate degree in nursing from Santa Rosa Junior College in California, who have $7,332 per month ($88,000 per year) in earnings net of federal student loan debt.
‘Merely getting a degree or certificate is not enough’
Researchers hope the more expansive College Scorecard data will reshape accreditation and help students and families make informed choices about higher education.
“Accessibility of this information could change the accreditation process so that accreditation becomes based at least partly on program-level employment and earnings outcomes instead of arcane measures like seat time in classes,” the report says. “Merely getting a degree or certificate is not enough to ensure a rosy financial future because of the remarkable variation in economic value among education and training programs…Consumers need to know about these differences so they can make the most effective investments in their education.”