The most expensive private universities aren’t worth the money, a surprising new report has found.
The analysis ranked 1,500 colleges and universities by comparing graduates’ earnings to what they paid for their degrees.
Those with Ivy League degrees easily got their money’s worth, even though they paid a high price for their education – as such, they ensure that graduates get the highest-paying jobs.
But if they don’t get accepted into an Ivy League school, they should think twice about going to what is often considered the second best.
That’s because among these eight colleges, spending money on a degree from prestigious non-Ivy private schools like Tulane, Oberlin and the University of Southern California doesn’t guarantee the same “return on investment.”
Ivy League colleges offered the highest return on investment ten years after enrollment. The photo shows Lockhart Hall at Princeton University. It had the highest ROI of all the Ivy Leagues: $340,000
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Instead, the study found that “flagship” public colleges offer a better return on investment ten years after enrollment than the prestigious and selective private schools – also known as the “Hidden Ivies.”
Flagship public schools include UC Berkeley, UCLA, the University of Michigan, the University of North Carolina at Chapel Hill, and the University of Virginia.
Continue the analysis Bloomberg used calculations from Georgetown’s Center on Education and the Workforce — and publicly available tuition and income data from graduates who accepted federal financial aid.
To calculate return on investment, the report looked at the average cost of a degree at each college. It compared that to the average total income of graduates of that university during the ten years after they enrolled.
The difference – subtracting fees from income – was called the return on investment.
Ivy League (e.g. Princeton University)
Return on investment – $265,500
Price – $75,000 – $80,000 per year
Degrees from Ivy League colleges had by far the highest return on investment despite their very high costs.
The Ivy League consists of the following eight institutions: Brown, Columbia, Cornell, Dartmouth, Harvard, Princeton, the University of Pennsylvania and Yale.
Elite soldiers (e.g. University of Southern California)
Return on investment – $135,000
Price – $70,000 – $80,000 per year
Prestigious private colleges like Fordham, Rice, Duke and Northwestern cost about $70,000 to $80,000 per year in comparison, but only offer returns of about $135,000, compared to the $265,500 that Ivy League degrees yield.
Although they offer quality education and good earnings, in many cases this is offset by their high price.
The study’s authors defined elite private schools based on a list in Howard and Matthew Greene’s book The Hidden Ivies, of which there are 63.
The average annual cost of attendance at the University of Southern California was over $77,000 per year. According to the analysis, the return on investment after ten years was $170,000.
Going to college almost always pays off, according to separate recent research. It turned out that most university courses offer better returns than the stock market.
The photo shows the home of the University of Southern California Trojans football team. The average annual cost of attending college is more than $77,000 per year. According to the analysis, the return on investment after ten years is $170,000
Flagship audience (e.g. University of Texas at Austin)
Return on investment – $148,000
Price – $20,000 – $40,000 per year
A better option, therefore, might be big-name public colleges, which averaged $148,000 despite costing between $20,000 and $40,000 per year.
These are the most prominent public institutions in different states. They include the University of Florida, Pennsylvania State, the University of Texas at Austin and the University of Illinois Urbana-Champaign.
“If you get into an Ivy, the ROI will be great. But if you’re part of the 99 percent of students who don’t participate, regional and national flagship schools can punch above their weight and enable strong returns on investment,” said Michael Itzkowitz, founder of HEA Group and former director of College Scorecard, told Bloomberg.
The University of Texas at Austin had a return on investment of $176,000 and annual attendance costs of about $27,000.
Aerial view of the University of Texas at Austin campus. The return on investment is $176,000 and the annual cost of participation is approximately $27,000
Public (e.g. Iowa State University)
Return on investment – $118,000
Price – $5,000 – $40,000 per year
The same trend was even observed between non-elite private and non-flagship public universities – public colleges Auburn in Alabama and the City University of New York outperformed their private counterparts.
In general, they cost about $20,000 per year, but still generated promising returns well above $100,000.
For example, Iowa State University only cost about $22,000 per year, but its degrees offered an average return of $153,000 after ten years.
Some of the top-performing colleges in this category included Missouri University of Science and Technology, the University of Connecticut and several maritime academies.
Private (e.g. Syracuse University)
Return on investment – $82,000
Price – $10,000 – $80,000 per year
The private category ignores the eight Ivy League schools and the list of 63 elite and expensive Hidden Ivies.
The cost of attending regular private colleges varied greatly, although the majority was over $40,000 per year. Syracuse, New York had a return on investment of almost $115,000 and a cost of almost $73,000 per year.
Meanwhile, Southwest Baptist University in Missouri had an annual cost of attendance of about $35,000 and a return of $75,000.
It’s worth noting that because the study only considered students who received financial aid, it ignored the future earnings of those who paid out of pocket. Lifetime earnings are also not taken into account, but only earnings around five or six years after graduation.
Some private colleges argued that this skewed the results in their favor.
“It is impossible to distill the excellence of any given university into one ranking, especially one that looks at success only in terms of dollars and cents,” Andrea Simakis, an Oberlin spokesperson, told the newspaper.
She noted that the school’s graduates are well represented among Grammy winners and genius MacArthur fellows.
In general, many art schools were expensive and generated poor and even negative returns. Examples include the Pennsylvania Academy of the Fine Arts, Berklee College of Music and California Institute of the Arts.
A separate study recently found that investing in a degree generally provided higher returns than the stock market
Nearly all of the majors that generated the highest salaries for graduates were in engineering
Conversely, schools that offer more science, technology, engineering and math courses had higher returns.
“Not only does this study not reflect the lifetime ROI of these individuals, it does not represent the ROI for the world,” the Oberlin spokesperson said.
Recently, another report found that the salaries Americans earn after graduating vary dramatically depending on their field of study. After five years, those who studied engineering earn more than double those who studied arts.
Meanwhile, there are concerns that the cost of college education is skyrocketing, with annual costs at Vanderbilt University approaching $100,000 per year. Students at the private school face a $400,000 bill for a typical four-year degree.
Columbia University has been in the news in recent weeks for camps in Gaza where students have expressed support for Hamas. A survivor of October 7 denounced the protesters for “supporting a terrorist regime” and said they “wouldn’t last a day” under Hamas rule.