A recent study compiled by Bloomberg BusinessWeek ranking more than 500 universities based on the financial returns students can expect gave top marks to the University of Notre Dame, followed by other Indiana schools Rose-Hulman Institute of Technology, Purdue University and Depauw University.
An undergraduate degree from IU-Bloomington ranked 214th.
The study utilized data from Payscale, a website that compiles information from users to produce salary comparison tools, and assigned a rating called an ROI, a
return on investment.
The study lists the “total cost to graduate” IU for an in-state student at $93,430. The same IU grad will earn almost $700,000 more than someone with only a high school degree in the course of 30 years.
This is a strong return on investment, but IU’s graduation rate is listed at 73 percent for in-state students, which significantly lowered the score and resulted in a lower rank.
Out-of-state IU students spend almost twice as much as in-state students, at a total cost to graduate of $161,700, while their degree will earn them $630,000 more than someone with only a high school degree.
According to the study, students getting the least bang for their buck across the nation were out-of-state students attending public universities.
Comparing the state’s two largest public universities, Purdue decidedly outranked IU. While Purdue has a graduation rate of 72 percent, slightly lower than IU’s, its graduates earn more than $1 million compared to those with only a high school diploma. The total cost to graduate from Purdue is listed at $85,320, $10,000 less than the estimated cost to graduate from IU.
As is the case at Purdue, many of the top-ranked institutions specialize in programs like engineering and technology. Dale Whittaker, vice provost for undergraduate academic affairs at Purdue, said he agrees that area of specialty can affect the ROI ranking of a university.
“Close to 40 percent of the students we graduate leave with an engineering degree, which leads to some of the highest paying jobs available,” Whittaker said. “So, obviously, this skews the ROI ranking in our favor in comparison with IU, where there is more specialization in the arts and humanities. This ranking does not take into account the social capital which is clearly generated by the people in those fields.”
While pleased with the ranking Purdue received, Whittaker believes the ROI report is “only one of many tools people looking to invest in higher education have at their disposal when making such animportant decision.”
By its own admission, the report does not use financial aid as a factor in establishing the ROI ratings.
Dan Smith, dean of the Kelley School of Business, takes issue with the ranking system.
“Above all, the Bloomberg BusinessWeek report does not take into consideration the true cost of the degree after adjusting for scholarships and other financial aid provided by the University,” he said. “IU has done a superb job of increasing funds available for scholarships, particularly for students who are residents of Indiana. If these adjustments were made, the ROI of an IU degree would in fact be much greater than that based on the Bloomberg BusinessWeek calculation.”
IU spokesman Mark Land said he believes the BusinessWeek report takes a narrow view of the value of a college degree.
“This particular ranking chooses to frame the issue solely in financial terms, which skews the results against public institutions such as IU that prepare students for a broad spectrum of career fields,” Land said.
Land said the report does not account for graduates providing public benefit by working in fields such as education, public administration and non-profit organizations, where the value of a career is not simply measured by the salary one receives.
Only undergraduate data was used in the BusinessWeek report. Therefore, the study did not reflect the strength of a graduate degree from IU.
“Many of IU’s strengths lie in its graduate programs like the Kelley School of Business, the Maurer and McKinney schools of law and the IU Medical School,” Land noted.
Land said likes to look at the value of an IU degree as it reaches beyond the campus.
“The enduring value of an IU education can be seen in the contributions of our graduates around the world, many of whom are leaders in their fields and their communities,” he said.