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Taking Some of the Guesswork Out of the Value-of-College Question

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The lifetime wage premium that accompanies a college degree has long been the best selling point for colleges trying to attract students. The marketing pitch went something like this: Don't worry how much you spend on our degree, we all know that getting a college credential is worth it.

Of course, not all colleges or majors are created equal. And it's nearly impossible for consumers to get any information about how much a graduate in a specific major from a particular university earns. That's probably one of the best measures of the return on investment in higher education, but, as with so many other tools that would allow consumers to make bottom-line comparisons, colleges are loath to share such information. In the absence of data, it's easier for colleges to sell the dream of higher education at any cost.

But with tuition prices continuing to climb and the economy stuck in neutral, families will increasingly demand more information on what they're buying.

Like politicians elsewhere, Virginia lawmakers have heard such complaints from parents and decided to do something about it. Over the last two years, the state legislature has passed two bills that, beginning this spring, will give families access to a key component in answering the value-of-college question: median salaries for the graduates of hundreds of academic programs across every public institution and some private colleges in the state.

The public database, which is expected in April, will allow students and parents to look at potential earnings over a six-year period in several ways. They can look at a specific program to see median earnings by type of degree (a certificate vs. a two-year degree in information technology, for instance) or across institutions (an English degree at James Madison University vs. the same degree at George Mason University), or majors across a campus.

The tool will have several limitations. It includes information only on students who graduate from Virginia institutions and work in the state, and excludes the self-employed. It also shows employment only by industry, rather than by job. So someone who works in information technology at Target, for instance, will show up as employed in retail.

Even so, when the database is released, Virginia will become the first state in the country to make such information available on a widespread basis. It's about time.

"It turns out not to be complicated to do it," explains Mark Schneider, a vice president at the American Institutes for Research, which is working with Virginia on analyzing its data. So why has it taken so long? Technology? "It's not an IT problem, it's a political problem," says Schneider, who served as U.S. commissioner of education statistics from 2005 to 2008.

To get these statistics, you need two sets of numbers. One is from the unemployment-insurance program that every state runs. Employers who are part of that program must report the salaries of their employees every quarter. The second number is a "unit-record number," a unique ID for each student enrolled in an institution in the state.

The unit-record number probably sounds familiar because it was at the center of a debate during the George W. Bush administration. The administration wanted to create a national system to track students, which would have allowed us to know so much more about transfers, completions, and employment than we do now. Higher-education lobbyists, particularly from private colleges, successfully fought back attempts to build such a system over privacy concerns.

But many states already have such unique ID's for their college students (some private and for-profit colleges in Virginia don't, which is why its system won't cover everyone). Schneider has a grant from the Lumina Foundation for Education for the work in Virginia and three to four other states. Once other states see what Virginia has done, it's very likely others will quickly follow, with or without the support of college leaders.

Some who work in academe don't like the idea of viewing a college degree through an economic lens. It's likely that this database will renew the debate over the purpose of college, training for a job or a broad education. To me, it's not an either/or argument.

Will some students decide not to major in the fine arts at Christopher Newport University once they see this median salary information? Perhaps. But for most families, this tool will be just one of many data points they use in the college search process, and more comparable information is needed on one of the biggest investments they'll make in their lifetimes.