While many students and parents worry about the high cost of a college education and the burden of student loans, a Georgetown University analysis looks into whether a college education delivers a solid return on investment in the long run.
The analysis concludes getting a liberal arts degree can, over 40 years, deliver a solid return on the investment. In some cases, that return on investment is in the millions.
Georgetown University’s Center on Education and the Workforce, using federal data, issued detailed rankings of 4,500 colleges and universities based on their returns on investment.
And the center has a searchable database that shows the return on investment over 10, 15, 20, 30 and 40 years.
At a liberal arts college, a student gets a specific education with a specific major. While combining a general education with a four-year liberal arts education may mean slower earnings right out of college, that changes over time and the return on investment increases.
“After a decade, the value of the combination of specific and general learning begins to outperform the more specific learning,” said Tony Carnevale, director of Georgetown University’s Center on Education and the Workforce, who worked on the analysis.
In calculating the return on investment, the analysis takes into account the future value of money and future earnings.
The analysis finds that “colleges with the best long-term net economic gains are all four-year institutions.” Eight in the top 10 are private nonprofit institutions. Two are public institutions that are maritime academies.
“We find that if the institution is more selective, if it is harder to get into, those schools will deliver more valuable degrees,” Carnevale said.
Forty years down the road, some of those colleges can have a value of more than $2 million.
Among the institutions with the highest long-term value are four pharmacy schools, as well as Ivy League schools, and Georgetown.
“The highest long-term returns generally are at four-year colleges with low median debt levels and degrees leading to high-paying careers, including high-prestige universities like Harvard University and specialized institutions such as Maine Maritime Academy,” analysis said.
Carnevale said students from small colleges did nearly as well as students from very large, research-based universities.
Colleges in New England and the Mid-Atlantic also saw the highest returns on investment. Liberal arts degrees from the Southwest and Southeast saw the lowest returns.
So what about a community college education?
In the short term — 10 years — community colleges and certificate programs offer the highest return on investment.
On the opposite side of the spectrum, the analysis finds the institutions delivering the lowest long-term economic value include theological institutions, beauty schools and colleges that specialize in the arts.
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