If you read the news, you inevitable come across articles like Want a job? Get a computer science degree, which suggest that computer science “grads received an average of 2.3 job offers and had an average starting salary of more than $72,000 – the highest of any starting salary.” Surveys by NACE, such as Top-Paid Majors for 2009-10 Bachelor’s Degree Graduates, rank Computer Science as the fourth most lucrative undergraduate degree, after Petroleum Engineering, Chemical Engineering, and Mining & Mineral Engineering. With rising tuition costs, undergrads are feeling more pressure to graduate with majors that will help them repay their student loans and establish themselves.
I noticed that many universities post the results of their alumni employment surveys online, and gathered them into a spreadsheet. I will be looking at Cornell University, MIT, Stanford, UC Berkeley, CMU and UoA. I want to treat each university as a kind of asset, and categorize their volatility and average return. I imagine that the kind of university a prospective student, interested in maximizing his first-year earning potential, would choose would offer the most resilience to downturn, and the highest absolute salary.
Salary over Time per University
It’s clear from the above graph that the University’s ranking is a factor in first-year salary. The cluster of “top private schools” pulls away from the University of Arizona in earnings potential, and maintains an average of 23% more salary dollars in the last 12 years. That’s a significant spread.
Given the downturn during the tech crash of 2001, and the recent financial crisis, it’s worth asking which University will give you better returns than inflation on your salary (all of them), but without too much volatility (standard deviation of returns). As it turns out, there’s only one university in that sweet spot: Cornell University (disclosure: my alma mater).
While Stanford/MIT/UC Berkely have average salary growth of 4.5% per year, they also have an average standard deviation of 8.5% and took a whopping -12% hit in the downturn of 2001. Cornell got by with a -7% return, but has a much more respectable standard deviation of 5% and average salary growth of 4%. Carnegie Melon has a similar deviation in returns, but only with a 2% growth rate.
This is informal analysis; if you have any comments or questions, please drop a note on this post! One obvious shortcoming of this data is that it only records the starting salaries of undergrads, which isn’t a good indicator of total earnings potential for undergraduates of various universities. In the longer view, there may be no difference between undergraduate universities.
Appendix of Data:
- Inflation data from Consumer Price Index – All Urban Consumers – (CPI-U) – U.S. city average.
- Cornell University data from Annual Starting Salaries 1985 – 2006 and 2008 Employment
- MIT data from their salary survey (only three years, WTF!), and graduating student survey.
- Stanford has a pretty good index page 1997 to 2008.
- UC Berkeley’s What Can I Do With a Major In…?.
- CMU Post Graduation Survey Results from the School of Computer Science.
- University of Arizona’s Career Destinations Results page.
Data is based on mean starting salary. Data is linearly interpolated to form smooth curves where knots are missing. I was unable to find data for Columbia or Princeton, so if you have a source, please let me know and I will update my spreadsheet!
I am: H.G. Wells ~ The first major literary talent to make himself at home in the science fiction field, greatly expanding its popularity.
There is no title I could write that would adequately describe either the state of my mind or the thing which happened to me
My bottle of apple juice began to ferment. It hissed as I opened, releasing a breath of alcoholic air.