President Obama’s announcement of a new College Scorecard during his 2013 State of the Union Address on Tuesday marks the latest and arguably most prominent pronouncement that return on investment, or ROI, is now viewed as the most important factor in determining the value of a college education in the United States.
We higher ed types can argue until we’re blue in the face that the true value of a college education is not a matter of mere dollars and cents. We can argue that value isn’t just about how much you pay for your degree and what kind of job you’ll get once you graduate. But judging from the president’s State of the Union comments, the economic benefits of a college degree loom large as an important factor in the discussion.
Obama introduced the College Scorecard as a tool “parents and students can use to compare schools based on a simple criteria — where you can get the most bang for your educational buck” (emphasis added). Education Secretary Arne Duncan echoed the president’s sentiments, writing on his blog that the scorecard “empowers families to make smart investments in higher education.”
The problem with the scorecard as it’s currently configured, however, is that it doesn’t provide much information about the earning potential for graduates of any of the schools listed in the database. (That’s one of many bugs to be worked out, apparently.)
Obama introduced the College Scorecard as a tool ‘parents and students can use to compare schools based on a simple criteria — where you can get the most bang for your educational buck’
Fortunately, there are other resources where prospective students and their families can turn to get some of that information. None of them are perfect, but they do offer consumers some way of looking at the economic outcomes of a college degree. So until all the bugs are all worked out of the College Scorecard and ROI information is included, these will have to do.
- PayScale’s ROI Report. Several years ago, PayScale saw the day coming when ROI would become a bigger consideration for prospective students. The organization developed an annual report, based on surveys of graduates and tuition data, to create a scorecard of their own. The interactive tool allows visitors to review more than 850 colleges and universities and sort the data in a variety of ways, such as 30-year net ROI, annual ROI, type of institution (private or public), category (liberal arts, engineering, research, etc.) and so on. Click on an individual school and you can see graduates’ median salary by occupation. Many third-party media outlets, including some listed below, relay on PayScale for salary data used in their own value ranking formulas.
- U.S. News & World Report‘s “Best Value” Colleges. The granddaddy of the college rankings game, the publication college administrators love to hate (except when the U.S. News rankings make their institutions look good), does actually offer some value for people looking for, well, value. The relatively new “Best Value” rankings consider “academic quality” as judged by U.S. News‘ annual rankings, but also weigh that against other factors, such as “net cost of attendance for a student who receives the average level of need-based financial aid.” It isn’t perfect, but it also isn’t based solely on dollars and sense, because U.S. News attempts to calculate that evasive beast “academic quality” into their formula.
- Newsweek‘s “Most Affordable Colleges” ranking. Just weeks before announcing it would become an all-digital publication, Newsweek put out a college rankings guide of its own last summer. In addition to several Princeton Review-esque listings of top party colleges, most liberal and conservative campuses, happiest and most stressful schools, etc., the publication looked at what it called “long-term affordability.” Which means: “In other words, the schools that landed atop of our most affordable list may not have the lowest sticker price, but when measured through a lens of the potential earnings with a degree from each institution as well as the average debt level of graduates, these are the schools where students are most able to shoulder the cost of their degree — and where the education has a proven record of being a valuable investment relative to other schools.”
- ABC News’ “Better Than Harvard” rankings. Last fall, ABC News mashed up PayScale’s earnings data with tuition and fees data from the annual U.S. News & World Report ranking to come up with a news story of sorts: “12 Colleges Whose Payoff In Pay Beats Harvard’s.”
- ROI by college major. A rash of online sites have latched on to the ROI craze by discussing majors with the greatest return on investment. Maybe students and their parents care more about which majors will lead to great jobs more than what college to attend. U.S. News ran one such article last fall, coinciding with the release of its latest annual “Best Colleges” book. And the Huffington Post network of websites periodically runs similar stories, like this one from last spring and this one (republished from Forbes) from just a few weeks ago. Then there are the flip side stories, like this one about college degrees that offer the worst ROI.
None of these tools are types or articles are perfect, but they do attempt to show the one aspect of value that the president’s College Scorecard so far has not provided: the employment outlook for college graduates.
No matter what you think about the ROI craze, you might as well accept the fact that it will be around for a while. We might as well accept it and, like Obama, figure out a way to make the best of it.