College Education: Debt and Income

The Wall Street Journal  has a piece (behind a paywall) comparing student debt and subsequent incomes for a number of college programs. A calculator near the bottom of the page allows the reader to select the degree and then any college(s) to emphasize on a graph. The data are ratios of median debt for graduates in “roughly” 2014-15 to median income two years later.

Caveat: Data are only for students with federal student loans and may not be representative of results for students who did not take out such loans. As well, the data are medians and do not capture the experiences of students who borrowed or earned much more or less.

To start, here is the graph for medical schools, with data for seven selected institutions:

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Unfortunately for clarity here, the Journal sorts by school name, so we have to look at colors and ratios to find the selected schools on the graph.

The graph shows the ratio of debt to income at each school; the table below the graph shows those ratios as well as the median debt and income for the selected schools. The vertical axis merely expands to allow points for multiple schools in a given debt/income range; position in that direction is irrelevant.

I selected Harvard, Stanford, and Columbia here because of their position at the low ratio end of the list. Otherwise, my selections here and below have “Virginia” in the school name or were spotted by my scan of the list.

We might expect graduates of prestigious schools such as Harvard, Stanford, and Columbia to enjoy relatively larger incomes; that is the case here but the low ratios also reflect lower debt levels.

UVa is the best of the Virginia batch, with a 2.19(!) debt to income ratio.

With a little help from Professor Bill Gates, we can recast the data as a plot of income v. debt.

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The upper left corner there is where you’d want your kid.

The two outliers here, University of Puerto Rico-Medical Sciences and Southwest College of Naturopathic Medicine & Health Sciences, compress the rest of the graph. Expanding the income axis to remove those two gives a more detailed picture.

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Here the relatively higher incomes and lower debt of Harvard et al. stand out. Likewise the more modest and roughly similar incomes and higher to much higher debt levels at the Virginia schools other than UVa.

We have to wonder whether these modest (for doctors) incomes reflect the going rates for interns and not for doctors out in practice. The WSJ  article does not contain the word “intern.”

Turning to law schools we see:

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Here, THE University is playing with the Big Guys, with hefty incomes offsetting the relatively high debt level.

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Perhaps interestingly, the bulk of the law graduates here see incomes in the vicinity of $60,000, whatever their debt levels.

In contrast to the case of medical schools, most law graduates go to jobs, not internships.

In any event, these and the med school data might serve to raise questions about Willie and Waylon’s advice to mothers to “let [your babies] be doctors and lawyers and such.”

Likewise dentistry (but see VCU beat out Harvard on both the ratio and incomes(!)).

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Some (many?) dentistry graduates take multi-year residencies so, as with the doctors, these data may paint a distorted picture.

Turning to bachelor’s degrees, those in “Business/Commerce General” paint a much prettier picture.

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We probably should wonder about these incomes: Many of the better students in bachelor’s programs go on to graduate school and won’t show in the WSJ  data.

In any event, Chemical Engineering.

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And Chemistry.

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Computer Science.

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Criminal Justice and Corrections.

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English Language and Literature, General

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Fine and Studio Arts.

Health and Physical Education/Fitness

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Mathematics:

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Music:

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Psychology, General.

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Note: Eight “Virginia” colleges are in the overall list (looks like nearly everybody teaches psychology) but VCU, VPI, and Wesleyan are off scale on the graph because of the crowd.

As noted above, these data, especially the medical, dental, and undergraduate numbers, need to be viewed with some skepticism. In any case, they point to an important consideration. For sure, if I had a kid thinking of college, I’d get out the computer and start a discussion about expectations.