As March Madness nears its exciting zenith, it’s worth looking beyond the drama and excitement to the colleges themselves. Beyond their basketball prowess, which schools deliver a strong return on investment to their students?
Education reporting organization The 74, in partnership with former professor Jorge Klor de Alva, crunched the numbers to give college fans yet another way to rank their schools: a social mobility bracket. When a student graduates from their school, will they be swimming in unpayable debt, or will their earnings easily offset the costs of the investment?
To determine this, The 74 used the:
Economic Mobility Index (EMI), [which] uses information from the Department of Education and the Census Bureau to rank 1,320 bachelor’s degree-granting institutions by how well each provides economic mobility for its students…
Placement in the Economic Mobility Index (EMI) is calculated by dividing each college’s average cost of an undergraduate degree by its graduates’ average earnings 10 years after enrollment, minus the typical salary of a high school grad, and multiplying that by the school’s percentage of Pell Grant recipients. The EMI captures both the proportion of under-resourced students enrolled and students’ return on investment in their college education.
The index then considers the added financial benefits students gain from attending one of these schools. This earnings premium is the additional income graduates accrue compared to someone with only a high school diploma. In effect, the lower the out-of-pocket costs and the higher the earnings premium, the quicker a student will receive a return on the investment needed to obtain the degree. Lastly, the index rewards schools for the proportion of financially challenged students they enroll and for the return on investment they deliver.
Put in layman’s terms, the bracket measured how well the average college graduate from each school did in comparison to a high school graduate, taking into account each student’s financial need and their time spent to pay off collegiate debt.
The winner of the 74’s Social Mobility Tournament for the second year in a row is Brigham Young University.
Even though BYU is a private school (which tend to not be strongly associated with high social mobility) it has low tuition, generous financial aid, and a large selection of students who receive Pell Grants. According to The 74, “BYU graduates have a price-to-earnings premium that permits them to pay down the cost of their degree in less than a year.”
As I’ve written previously, it’s not always a given that a college graduate will be financially better off than a high school graduate. Since the average federal student loan debt is a shocking $39,075 per borrower, it’s vital for prospective students to carefully examine the projected financial outcomes for their chosen school.
Congrats to BYU for winning this Social Mobility Matchup!
While BYU may have won this (arguably more important) bracket, they fell quickly in this year’s traditional basketball matchup.
(Sadly, my alma mater, Baylor University, didn’t make it into March Madness this year. I’m comforted by the fact they beat the U of Minnesota handily in the CBC yesterday.)
Sports fans will have to wait until Monday to learn who the champion of this year’s basketball season might be!
