Author David Levy
Choosing a college is influenced by a variety of factors. Students may be attracted by a school’s academic reputation. Others may look for a specific type of college experience – prioritizing a vibrant campus life, social activities and organizations, smaller or larger student populations, a specific location, or religious considerations. Family traditions or recommendations from trusted mentors can also influence a student’s choice.
In addition to these factors, surveys reveal that financial considerations frequently play a crucial role in both the decision to pursue higher education and the selection of the institution.
Our rankings have been developed with a singular focus on relative financial value. This methodology statement provides a detailed analysis of how we calculate our rankings.
Data sources
Our rankings system is based entirely on data provided by the U.S. Department of Education’s Integrated Postsecondary Education Data System (IPEDS), College Scorecard (CSC), and supplemented with a small amount of additional data from the Census Bureau’s American Community Survey.
Limiting ranking inputs to government-provided source material is, in our view, the best way to maintain an objective and transparent standard.
Economic metrics
Our program rankings consider 2 economic metrics:
- The relationship between the cost of a degree and a student’s eventual earnings;
- An earnings comparison between different schools.
These metrics vary between undergraduate and graduate levels due to available data constraints. At the undergraduate level, median net cost is provided; at the graduate level, only median graduation debt is available.
Cost to earnings
For undergraduate students, we calculate the total cost of a degree by multiplying the net annual cost by the average completion time (ACT).
Total cost = net annual cost x average completion time (ACT)
ACT: an average of 4-, 6-, and 8-year graduation rates. Graduation time is an aggregate at each college, meaning there is no allowance for any differences in time to graduation based on choice of major. Students that do not graduate are not considered in the ACT calculation.
Net annual cost: a median derived from students that have received at least $1 in federal aid. It includes tuition, fees, books and supplies, housing, and other related expenses.
For graduate students we use program-level debt data as an indicator of relative cost. (Median debt figures are calculated by IPEDS using debt at the time of graduation.)
Earnings
For undergraduate students, we calculate what proportion of their total earnings can reasonably be credited to their college education. We do this by subtracting the median earnings of a high-school graduate (as provided by Census data) from each college’s net median earnings. The difference – or marginal earnings – represents the upside in earnings of the education.
Marginal earnings = A college’s net median earnings – high school median earnings
Payback
Marginal earnings are then divided by total cost, the output of which represents the amount of time it takes to pay back a college education with new earnings. We call this key performance indicator payback.
How did we arrive at that number?
To calculate a school’s payback, we divide the total cost of the school by the extra money you are making with a college degree versus just a high school diploma – your marginal earnings.
Total Cost ÷ Marginal Earnings = Payback
So, for CUNY City College:
$13,941* ÷ $31,955** = 0.4 years or “less than 6 months”
* Total cost = net annual cost ($2,805) times years to graduate (4.97)
** High school earnings in New York state are $23,786; bachelor’s earnings at CUNY City College are $55,741
For graduate-level rankings, we divide the median debt by student earnings 4 years after graduation to create a debt-to-earnings ratio. The debt-to-earnings ratio is applied to each program at each college or university with sufficient data.
Payback and the debt-to-earnings ratio are how we determine the “value” of a degree or program at each school. The lower these figures, the better, because the number represents the amount of time it takes for earnings to overtake cost.
EarningsPlus
To measure relative earnings by school, we compare a school’s program-level median earnings against a benchmark of all students:
- from the same time period
- at the same degree level
- with the same degree type
A school’s earning performance is called EarningsPlus.
If a school has a program with an EarningsPlus of +$10,000, it indicates that students earn $10,000 more than the weighted average earnings (the “earning benchmark”) of all students graduating with the same major in the same year.
This calculation is used for both undergraduate and graduate programs, using only the relevant degree level.
See below an example of how the earning benchmark is calculated for a program:
Students | Earnings | Total earnings | |
School A | 2,000 | $50,000 | $100,000,000 |
School B | 1,000 | $75,000 | $75,000,000 |
School C | 1,800 | $55,000 | $99,000,000 |
School D | 2,800 | $47,000 | $133,000,000 |
School E | 875 | $66,000 | $57,750,000 |
Total | 8,475 | $464,750,000 |
The earning benchmark for this program would be $464,750,000/8475=$54,837.76.
In-state/out-of-state
Additionally, we adjust each school’s earning benchmark to account for the in-state/out-of-state composition of their student body. (For more information on why this adjustment is necessary, please read our statement on methodology changes.)
Earning benchmarks are created by program at both state and national levels. If, for example, a college has a 50/50 split between in- and out-of-state students, then the state/national earning benchmarks would be allocated at a 50/50 split.
For example:
In state | Out-of-state | Adjusted earnings | |
Program A | $30,000 | $40,000 | $35,000 |
Program B | $27,500 | $35,000 | $31,250 |
Program C | $50,000 | $62,000 | $56,000 |
Program D | $45,000 | $40,000 | $42,500 |
Creating the economic score
The economic score adjusts a program’s cost-to-earnings metric (payback for undergraduates; debt-to-earnings for graduates) by their EarningsPlus performance.
EarningsPlus is converted into a percentage (EarningsPlus Percentage – EPP), which represents how a school’s program compares, earnings-wise, against its earning benchmark.
For instance:
- An EPP of 100% would mean the program performs exactly the same as their earning benchmark;
- An EPP of 110% would mean the program performs 10% above their earning benchmark; and
- An EPP of 90% would mean the program performs 10% below their earning benchmark;
And so on.
The cost-to-earnings metric is then divided by the EPP.
If the EPP is above 100%, the economic score will be lower than payback or debt-to-earnings;
If the EPP is below 100%, it will be higher than the payback or debt-to-earnings.
Remember that lower is better for both payback and debt-to-earnings; we felt it logical to keep the economic score on the same lower-is-better scale.
For example, imagine two schools, each with a payback of 2.0.
The first school outperforms their earnings benchmark by 20% (EPP=120%); the second school underperforms against their earnings benchmark by 20% (EPP=80%).
2.0 / 120% = 1.67
2.0 / 80% = 2.5
The first school would earn an economic score of 1.67; the second would get a 2.5.
School-level rankings
While we rank associate and graduate programs only at the program level, for the bachelor’s level we also evaluate the overall economic performance of each college or university.
Our institutional-level ranking methodology is the same as described above, but at the institutional level, we adjust each school’s EarningsPlus to account for the types of majors students are graduating with. (Why?)
In simpler terms, a school’s overall EarningsPlus performance is a sum of each program’s performance, each weighted according to its share of the school’s total student population.
For example:
Students in cohort | EarningsPlus | Cohort EarningsPlus | |
Program 1 | 100 | $10,000 | $1,000,000 |
Program 2 | 500 | $12,000 | $6,000,000 |
Program 3 | 250 | $40,000 | $100,000,000 |
Program 4 | 800 | -$2,000 | $-1,600,000 |
Program 5 | 325 | $15,000 | $4,875,000 |
1,975 | $20,275,000 |
In the example above, the college’s EarningsPlus would be $20,275,000 / 1975 = $10,265.
Institutional-level cohorts
At the program level, we do not differentiate between school types. If a school offers the relevant degree level and program, it is included in the program-level rankings.
When ranking the aggregate performance of an entire institution, colleges and universities are divided into 4 main cohorts:
National universities – Offer doctoral-level programs.
Regional colleges and universities – Limit their degree programs to baccalaureate (4-year degrees) and/or master’s level.
Liberal arts colleges – Generally limited to baccalaureate-level programs, with an emphasis on the arts and sciences.
Community colleges – Offer 2-year associate degrees; if a school predominantly offers associate degrees but does offer some 4-year programs, they are classified as community college. If the school offers a mix, they are classified as bachelor level (i.e., grouped with regional colleges and universities). Community colleges are ranked only at the program level, much like graduate schools.
Schools are allocated to these categories according to the Carnegie Classification of Institutions of Higher Education framework.
At the institutional level, national universities and liberal arts colleges are compared only against schools within their cohort unless looking at all schools within a particular state or region.
Regional or state rankings include all 4-year colleges that fall within the relevant geographic region regardless of their Carnegie classification.
Additional ranking considerations
Graduation rates:
If a school falls within the bottom 25% of national graduation rates, it will not qualify for ranking, though it will be listed at the end of the relevant ranking table.
Although we do not incorporate graduation rates into our ranking calculations, the metric should be a crucial consideration for students. When a school’s graduation rate falls below the national average, it will be highlighted in red. This benchmark applies distinctly to different types of institutions, with specific thresholds established for 4-year colleges, both on-campus and online, as well as for 2-year colleges.
Relevant cohort size:
Earnings data are only provided by CSC if there is a large enough cohort to make the data statistically meaningful. If a school does not have enough students to generate earnings data for a particular program, it will not be included in the rankings.
Additionally, if the number of graduates in a particular program has dropped below 5 at the graduate level, and below 10 at the undergraduate level, we exclude the school.
Minimum schools needed for comparison:
If a particular ranking does not have enough schools to provide a meaningful contrast, we will not publish it. For instance, some states may not appear for particular graduate program rankings – this is almost always due to insufficient program coverage by schools in the state.
FAQ
Why is my school not ranked?
- Schools included in our rankings must be eligible for Title IV funds
- Schools with graduation rates in the bottom 25% nationally are pushed to the bottom of our ranking tables.
- Our rankings lists are divided into different school categories, and you might be looking under the wrong list.
- National Universities: Must offer doctorate level studies (Carnegie Classification 15-17)
- Regional rankings: Masters and bachelor-level institutions that do not offer doctoral programs (Carnegie Classification 18-20,22)
- Liberal Arts: Bachelor level colleges with an arts and sciences focus (Carnegie Classification 21)
Why can’t I find my school in my state’s rankings?
- If there are fewer than 10 ranked schools, we do not display the state at the program or institutional level.
I can’t find my program listed. Why not?
- If there are fewer than 10 ranked schools offering a particular program across the country, we do not show the program.
Why is my school not listed for the program I am enrolled in?
- We only consider programs with at least 10 conferrals at the undergraduate level and at least 5 conferrals at the graduate level.
- Programs with too few graduating students often will not have enough earning data for statistical significance, and so are omitted from Treasury reporting.
- We will not include schools that do not have the earnings and cost data required to calculate our economic score.
Why can’t I find my state for the program I want to study?
- If there are fewer than 3 programs available for comparison in any state we will not populate the state rankings. You can still check out a school’s individual performance on their school profile.
Why can’t I find my school in the online college rankings?
- Only entirely online colleges are included in our best online colleges list.
- Colleges on the best online colleges list must have at least 5 different programs.
- Programs must have at least 10 graduates to be considered.
- Rankings for online programs include all programs with at least 10 graduates.
- These programs may be either hybrid or entirely online.
Does the data presented across the site come from the universities themselves?
- No, Degreechoices.com is not associated with any university unless stated clearly as an ad. Earnings, costs, and other data points are taken from official government sources, which collect and process the data. Government sources we use include, but are not limited to, IPEDS, College Scorecard, O*net, and the Bureau of Labor Statistics.