For college students majoring in business, the type of school they attend may play a big role in their starting salaries after graduation.
Alumni from private schools had a starting salary that was 11.3 percent higher than public school grads, according to a July blog post from the Association to Advance Collegiate Schools of Business.
The salary data is based on 257 schools — such as George Washington University, University of Cincinnati and New York University — that participated in the association’s annual Business School Questionnaire; 43 of the schools were located outside the U.S.
A new graduate with a four-year business degree makes $49,768, on average, according to the association. The National Association of Colleges and Employers, however, says it’s actually a little higher: $51,452.
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A school’s salary data can reveal the type of academic instruction students receive, says Burton Hollifield, the academic head of the undergraduate business administration degree and a professor of finance at the Tepper School of Business at Carnegie Mellon University, a private institution in Pittsburgh.
“I think it’s sort of like a temperature gauge of the quality of the place,” he says. “It’s reflecting that you’re learning skills that other people are valuing.”
Carnegie Mellon’s graduates have fared well in the job market.
“Last year we had 90 students who graduated,” he says of the class of 2016. “As of Aug. 3, 83 percent were employed.”
Many graduates work in technology, consulting or financial services. “The top employers were IBM, JPMorgan Chase, Accenture, Citibank, Ernst & Young,” Hollifield says. The average starting salary for 2016 graduates was $75,787, he wrote in an email.
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Students from public schools, of course, can also secure competitive jobs and salaries.
“The average starting salary last year was $56,000, and we expect it to go up this year,” says Raj Singh, associate dean for undergraduate programs in the Carlson School of Management at the University of Minnesota–Twin Cities. Within 90 days of graduation, 97.9 percent of graduates of the class of 2015 received a job offer, started a business, joined the military or were accepted into graduate school.
Because prospective college students usually want to attend a school and pursue a major that will land them a well-paying job, it’s important that they think about their post-college earnings, experts say. But salary shouldn’t be the only factor they consider.
Applicants and parents shouldn’t use the association’s blog post to make any sweeping generalizations about public or private institutions, says Elizabeth Heaton, vice president of educational consulting for College Coach, which helps college applicants get into schools.
“You could just have, maybe, students who can afford to go to private school and perhaps have a little bit more in terms of advantage when they are graduating. Maybe their parents have contacts or they developed contacts that helped them get a slightly better job,” she says.
Families should also consider the degree’s cost, says Heaton, who is also a former University of Pennsylvania admissions officer.
“What I worry about is people look at that and they think, ‘Oh, well, then it’s worth it for us to take on $60,000 a year in debt,'” she says when discussing the AACSB blog post. “Whereas if they had kind of ignored that and made a more financially reasonable decision, maybe it would have been a private school or maybe it would be a public school.”
In some cases, says Heaton, a public school might make more sense for a college applicant.
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“Especially if you don’t graduate with any debt, that leaves you a little bit freer to make different choices when you come out of school. Maybe you don’t have to take a job that’s quite as high paying,” she says.
And in other cases, it may not.
“There are private schools that might cost you less to attend than a public institution depending on merit money that you might get or financial aid that you might get,” she says.
Prospective college students should consider several other factors beyond the potential starting salary, Heaton says. “Take a look at the coursework. Not all business programs are created equally.” A student interested in entrepreneurship, for example, may find that a school of interest has a finance-heavy curriculum.
Applicants should also find out, she says, what kind of support the career services department offers students for getting internships and jobs, whether the school’s alumni work in the field that’s of interest to the applicant and if the school connects students with alumni.
Singh encourages prospective students to also learn about which companies recruit students from different schools. In the end, though, it all comes down to which school an applicant is most comfortable with.
“When I talk to students, I always tell them that going to college is like buying a suit or buying a shoe,” he says. “What fits you right is more important than anything else.”
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Comparing Public and Private Schools for an Undergrad Business Degree originally appeared on usnews.com
