Most campus leaders know some college degrees are more lucrative than others. What they may not know is how the ROI changes at different levels of college completion.
More than three-quarters of bachelor’s degree programs have a positive ROI but the same cannot be said at the graduate level, according to a new Foundation for Research on Equal Opportunity report analyzing 53,000 different degree and certificate programs.
“The findings show that college is worth it more often than not, but there are key exceptions,” notes the report’s author, research fellow Preston Cooper. “Nearly half of master’s degree programs leave students financially worse off.”
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Starting at the two-year level, the analysis finds much higher ROI for career-oriented associate’s degrees. “Two-year degrees in liberal arts have no ROI,” the report asserts. Two-year certificates in technical trades can even lead to higher earnings than the average bachelor’s degree, Cooper adds.
The median ROI for bachelor’s programs is $160,000, but four-year college degrees in engineering, computer science, nursing and economics are the most lucrative, with payoffs of $500,000 or more. “Other majors, including fine arts, education, English and psychology, usually have a smaller payoff—or none at all,” Cooper adds.
Some graduate degrees lead to payoffs above $1 million; those programs comprise law, medicine and dentistry. But about four in 10 master degree’s result in a negative ROI. “Even the MBA, one of America’s most popular master’s degrees, frequently has a low or negative payoff,” Cooper asserts.
The report also introduces a “mobility index”—which multiplies ROI by the number of students in a program—to gauge the value of degrees from individual nonprofit and for-profit institutions. “Bachelor’s degrees in nursing and business administration dominate the top ranks of the mobility index,” Cooper concludes.
