It is March, so it must be time for "March Madness", the NCAA division I basketball championships. Here at PayScale, we always look at things with a salary slant.
This year, we were kicking around March Madness ideas and hit upon the question, does the pay of a university's graduates predict how well the school will do in the NCAA Division I Men's Basketball Championship? Yes, this is a weird question, but we are weird people :-)
This question is not about the future pay of the basketball players. We were wondering about all those alumni filling the stands. Do the salaries the alumni earn predict how well the basketball team will do?
At PayScale.com, we have the data. Here is a teaser: using average university graduate salary, we predicted Mount Saint Mary's University (median annual salary: $60,200) would beat Coppin State University ($46,900).
Is your salary a "1 seed", or just struggling to make the play-in game? Find out if you are earning what you are worth with the PayScale salary calculator.
What is the Average University Graduate Salary?
First, a disclaimer: if you haven't read my post on this already, all aggregate statistics lie. There is no such thing as a "typical" or average graduate of a particular university.
The average salaries we calculate to compare schools will surprise many people. You will know graduates of some of the schools who earn both much more, and much less, than the "typical" salaries we give.
However, America is all about competition, so we are going to compare the alumni anyway :-)
The calculation we used is simple:
- Identify the employees in our database who attended each university in the NCAA Men's bracket
- Select those who are 5 to 15 years into their careers: this is about 30 to 40 years old
- Calculate the median annual total cash compensation for the selected employees
Annual total cash compensation includes the base salary/wage, bonus, profit sharing, commission, and tips that an employee earns in a year at one job. It does not include equity compensation (e.g., stock options) or non-cash benefits (e.g., health insurance).
Obviously, we are not counting the salaries (or lack thereof) of alumni who are not employed. We also do not include self-employed graduates, like consultants, small business owners, and freelance writers.
We also did not draw a distinction between undergraduate and graduate and professional school graduates. This can cause the median to be a bit higher for universities with medical, business and law schools, and somewhat lower for schools with graduate teaching and Ph.D. programs :-)
We use the median, because it is much less sensitive to a few high paid graduates (the Stephon Marbury effect). The median tends to reduce the effect of graduate schools on the result.
So don't send me hate mail because the stats say Notre Dame graduates make more than Duke alumni :-)
Which University Wins March Madness?
To fill in the brackets, we predicted the school with the higher average graduate pay in each game would win. While some games were truly toss-ups (pay a statistical dead-heat), we picked the school whose alumni earned slightly more anyway.
See our complete 2008 March Madness Predictions on our main website. Here are the "1 seeds", when pay is the measure of "best", and how we predict they will do:
- Stanford ($113,000) - Wins it all!
- Notre Dame ($99,100) - Goes to the championship game
- Duke ($96,800)- Makes the final four (as usual; Go Blue Devils! :-)
- Cornell ($93,900)- Out in the first round to Stanford
Just like what often happens in the NCAAs, some lower-ranked teams make it through to the Elite Eight or higher. The teams that make the Men's Division I Basketball Elite Eight, if university graduate pay determines the winners, and their seeds based on the PayScale typical graduate salary, are:
- Texas Arlington ($69,000) - 7 seed
- American ($72,300) - 6 seed
- Vanderbilt ($83,400) - 3 seed
- UCLA ($86,600) - 2 seed
- Georgetown ($92,500) - 2 seed
- Duke ($96,800) - 1 seed
- Notre Dame ($99,100) - 1 seed
- Stanford ($113,000) - 1 seed
March Madness by the Dollars
One last question: is there any correlation between how the teams are seeded based on their basketball play, and the typical salary of their graduates?
Strangely, the answer appears to be yes: there is correlation between basketball seed and alumni pay. A school's initial seed improves by approximately 2.5 spots for every $10,000 increase in the school's typical alumni annual compensation.
I am sure this correlation has nothing to do with rich alumni paying current basketball players under the table :-)
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