Everyone can debate the validity of the dozens of college rankings released every year. But it’s tough to find anyone who would debate one that ranked the return on investment more than a generation after enrolling.
Stevens Institute of Technology in Hoboken ranked No. 14 in the country for return on investment 40 years after enrollment, according to a new report from the Georgetown University Center on Education and the Workforce, “A First Try at ROI.”
The report said it an attempt to be the first to analyze the ROI of higher education at this longer time scale.
According to the study, the net present value for a Stevens degree is $1.83 million at 40 years, a value comparable to that of other prestigious universities, such as the University of Pennsylvania (No. 15), California Institute of Technology (No. 17), Yale University (No. 20) and Columbia University (No. 21).
The report uses expanded college scorecard data to calculate the net present value of a credential from 4,500 colleges, including traditional two-year and four-year public and private colleges, as well as for-profit colleges and training academies. The measure essentially weighs the cost of paying for college against future earnings.
And, while the rankings included many of the familiar schools in the top spots, they were decidedly different than the U.S. News & World Report rankings.
The first three schools were all pharmaceutical schools (Albany, St. Louis and Massachusetts). Massachusetts Institute of Technology came in fourth. Other familiar names included Stanford University (No. 5), Harvard University (No. 8) and Georgetown University (No. 9).
Stevens President Nariman Farvardin obviously was pleased with the ranking.
“This study is important, because it is the first to highlight the long-term return for the type of education that Stevens provides,” he said in a statement. “Because technology, innovation, and problem-solving are central to all Stevens degrees — from engineering and computer science, to business and music — Stevens graduates enjoy both immediate and long-term career success. As families consider their investment in and the expected value of a college degree, they should consider both the near-term and longer-term returns.”
The school also touted some other data.
Year over year, 96% of Stevens graduates secure jobs or admission to graduate school within six months of graduation, the school said. For the Class of 2018, the latest data available, the average starting salary was $71,400. After 10 years of experience in a field, Stevens graduates who earned a bachelor’s degree boast a median mid-career salary of $139,900, according to PayScale’s 2019 salary report. According to Payscale’s 2018 ROI report, Stevens alumni also enjoy a 20-year net ROI of $932,000, with financial aid considered.
Stevens tops all New Jersey colleges and universities at the 20-, 30- and 40-year marks.
The study, which looked at 2,129 four- and 1,550 two-year U.S. colleges and universities, as well as 847 certificate programs, found that public and private four-year institutions offering bachelor’s degrees had the highest ROI long term.
Private, nonprofit institutions like Stevens were found to have a higher ROI over the longest period. Even though students, on average, take out more in loans to attend private colleges, a degree from a private nonprofit college is worth $8,000 more annually 10 years after enrollment. Over the course of 40 years, the average graduate of a private college has a net economic gain of $838,000, even after paying off higher amounts of debt, compared to $765,000 for a graduate of a public college.