Last month, Smart Money released a “payback scorecard,” which ranked universities based on whether graduates’ salaries justify the tuition paid to the school. They surveyed 50 top-priced Ivy League, public, and private schools across the country.
Since none of North Carolina’s 54 colleges or universities is one of the most expensive schools, none of them showed up on Smart Money’s rankings.
But data showcased on the North Carolina College Finder (a Pope Center website) will help potential students assess North Carolina schools and decide whether their salaries after graduating are likely to justify the expense. A summary of the data can be seen below.
Instead of looking at tuition and salaries, I have examined the debt-to-salary ratio. Student debt captures more about the true costs of college than does tuition alone; due to generous scholarships and grants, many universities’ sticker price is vastly different from what students actually end up paying. Debt represents the amount that students can’t pay by working, saving, or earning scholarships during school—and will remain with them while they start careers. Debt data come from Peterson’s—a clearinghouse of educational data for parents and students.
Like Smart Money, we use salary data from PayScale.com, a website that maintains salary profiles of 29 million workers. We use the starting salary of recent graduates (actually, the average salary reported for the first five years after graduation). As I explained here, this generation’s graduates face different challenges than their parents did—so looking only at salaries of those students gives a clearer picture of the real difficulties confronting this generation.
As the table below shows, payback varies greatly among both public and private schools. For example, the typical graduate of North Carolina State leaves school with $14,930 in debt but earns $50,183 as a starting (or near-starting) salary. Thus the ratio of debt to salary is .3; college debt represents just under one third of the starting salary.
Elizabeth City State University, a public HBCU in eastern North Carolina, has the best debt-to-salary ratio at only .14; a graduate’s annual starting salary is seven times more than his or her total debt. While the starting salary for the average ECSU student is only $27,090, graduates start their careers with only $3,846 in debt.
Schools with a ratio of .57 or higher (marked in red) are at the other end of the spectrum. According to Mapping Your Future, student debt that represents more than 57 percent of one year’s salary will yield loan payments that are unaffordable. Nineteen North Carolina Schools exceed that ratio. Two schools, Johnson C. Smith and Meredith College, have ratios greater than one-to-one.
Editor’s Note: Salaries from Payscale seem a bit high across the board, probably because participation in Payscale is voluntary and salaries are self-reported. People who have short-term, low-paying jobs outside their fields may not report their pay. We consider the figures to be comparable across universities, however. If the reported salaries are higher than actual salaries, this means that the universities with debt ratios just under .57 may actually fall into the unaffordable category.