In partnership with CNN/Money, PayScale has produced its annual College Salary Report for 2010. Unlike the more subtle 2010 PayScale College Return on Investment (ROI) Report, this report answers four simple questions:
- What do bachelor's graduates with a particular major earn, both early in their career and at mid-career?
- What do bachelor's graduates of a school earn, both early in their career and at mid-career?
This year, the report includes an analysis of 999 US schools and 120 majors, up from 598 schools and 75 majors last year, and now covers schools with over 80% of all enrolled bachelor's degree students.
Working on this report, I am always amazed at the diversity of higher education in the US. Read on to learn about the top majors and schools this year, including some surprising changes from last year.
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Methodology: Graduates In and Out
Before getting into the details of the report, here is a quick overview of the methodology.
The basic data in the PayScale College Salary Report are median annual salaries:
- for bachelor’s degree graduates, who have not gone on to earn a higher degree
- for 999 universities and colleges in the United States
- for both starting career (median age: 25) and mid-career (median age: 42) graduates
- for graduates who are currently employed full-time in the US as a salaried or hourly wage employee
Salaries include all cash compensation (salary, bonuses, commission, etc.), but do not include equity (stock) compensation or other non-cash compensation (e.g., company car).
While this definition covers many graduates of colleges and in majors, we don’t report on the pay of every graduate. For example, we did not include these graduates:
- Unemployed graduates: growing, but still around 5%, based on government statistics
- Graduates who are stay-at-home parents: likely a significant fraction of “mid-career” graduates
- Graduates who do not work for pay (volunteers): may be significant at religious schools with a missionary focus
- Graduates who do not work full-time: part-time could be significant both early and later in career
- Graduates who have advanced degrees: 50% or more of graduates at some very selective schools
- Graduates who work for themselves: particularly small business owners and consultants
- Graduates who are paid per project: free-lance writers, some architects, etc.
Now let’s get to this year’s results.
Revenge of the Nerds
Despite the fame of private schools like Harvard, Yale, Stanford and Duke, and the numerous loyal alumni of state school powerhouses like the University of California, Michigan, and Texas, the top earning bachelor’s graduates for the last two years have hailed from the smallest Ivy League institution, Dartmouth College in the mountains of Hanover, New Hampshire.
What are the factors that have made Dartmouth #1:
- Strong programs in engineering and computer science, majors with perennially well-paid graduates
- A large number of alums who migrate to high wage areas like New York, Boston, and the San Francisco bay area
- A substantial number of graduates working in financial services (read, “Wall Street”)
These factors are why Dartmouth has been able to nose out more famous college competitors for top honors for mid-career pay.
The “great recession” has changed things: the center of top earnings has moved about as far as you can go in the continental US from cold New Hampshire.
This year, the top earning school is tiny Harvey Mudd College in sunny southern California. While small, Harvey Mudd is a very selective institution, only taking high school grads with outstanding records and a strong interest in engineering, math, or science, the only fields of study it offers.
While the recession has been hard across the board, graduates working in engineering and information technology have not been as hard hit as college graduates with less specific skills.
Despite the bad publicity about large bonuses at a few of the largest investment banks at the end of 2009, financial services more generally, particularly in home, construction, and personal loans, remains weak. Since this has traditionally been an area of high earnings for liberal arts grads, weakness here would tend to hit graduates of a diverse liberal arts college like Dartmouth with less technical degrees.
In the end of the day, the admittedly small change – ~5% swing between Harvey Mudd and Dartmouth between last and this year – could be caused by:
- Stronger job market and pay for engineering and science grads
- Pay holding up better in California for engineers than liberal arts grad in New York
- A statistical fluctuation
Let’s face it; these mid-career medians, particularly at elite schools, are the middle of a very broad distribution. For example, even though the median is $123,000/year for Dartmouth,
- 25% of Dartmouth grads earn less than ~$85,000/year (25th percentile)
- 25% earn more than ~$200,000/year at mid-career (75th percentile)
The $3,000/year the Dartmouth median is behind that of Harvey Mudd College graduates is really not a large factor, compared to the huge diversity in pay between graduates at each school.
Interestingly enough, as we see typically for engineering schools, the Harvey Mudd grads have a somewhat narrow range of pay: the 25th percentile is ~$100,000/year and the 75th percentile is ~$150,000/year.
The upshot is that the Dartmouth education creates graduates with the potential to earn much more than the typical Harvey Mudd graduate, while the Harvey Mudd education puts a floor under earnings that is significantly higher than that at Dartmouth College. In a weak economy, having the floor is an advantage.
So Much Data, So Many Stories
With 999 schools, 125 majors, and both starting and mid-career pay, there are many different stories: “best public school!”, “best engineering school!”, “best southern school!”, “worst college major!”, and many more, where “best” and “worst” are defined by graduate earnings.
I clearly can’t cover all of these in this blog post, but I can give a few interesting tidbits:
- Nursing schools in the top 10 for starting pay: Loma Linda repeats from last year representing healthcare profession focused schools in the top 10, and two new schools, Molloy and Felician Colleges have pushed out more famous Stanford and Princeton out
- Petroleum Engineering grads #1: Petroleum engineering is new to our majors list, and came in at #1, both for starting pay and at mid-career. With pay about 50% higher than the next closest major, you would think they could use a little of their paycheck to plug the leak in the gulf 🙂
- Black Hills State University no longer last: New to the list, Coker College in South Carolina has the lowest earning grads at mid-career for 2010. Not too surprising, since it is a southern school (lower wage area) with strong education and social work programs
Take some time to look through the report, and make your own “best” and “worse”, or perhaps “just right” analysis.
College is all well and good, but you will spend much more of your life working than studying: are you being paid what you are worth? For powerful salary data and comparisons customized for your exact position or job offer, build a complete profile with PayScale’s Salary Survey.
Director of Quantitative Analysis, PayScale, Inc.