College can boost your income by 37%. Here are the top schools for the best financial outcomes.
Even as Americans express growing skepticism about the value of a college degree, a new study finds "incontrovertible" data that college grads far outearn those with only a high school education.
In 2024, college grads' median pay stands at about 37% higher than median pay for those without a bachelor's degree, according to the analysis from compensation firm PayScale. In dollar terms, people with a college education earn about $78,400 annually in median pay, compared with $49,400 for people with a high school degree, the study found.
Americans' increasingly dim view of higher education comes amid rising tuition costs and the nation's ongoing student debt crisis, with millions of households grappling with a combined $1.7 trillion in college loans. While some professions don't require college degrees and can also provide good livings — such as trades like plumbing or electrical wiring — the earnings and wealth gap between college and high school grads remains significant.
For instance, young college grads have roughly quadruple the wealth of their less educated counterparts, a study from the Pew Research Center found earlier this year.
"Despite the skyrocketing cost of tuition and dwindling enrollment numbers, our data shows that a college degree is still valuable in today's job market based on better salary outcomes," Amy Stewart, principal, research and insights at Payscale, said in a statement.
Even so, not every college provides the same level of economic boost, according to a separate PayScale analysis, also released Wednesday. Students should make "strategic choices" to avoid debt that's difficult to pay back as well as to avoid underemployment, or working in a job that doesn't require a college degree, Stewart added.
The top colleges for return on investment
One way of analyzing the value of a college degree is to examine its return on investment (ROI), or the comparison between a grad's 20-year salary earnings minus the total cost of attendance for that college and the earnings of high school graduates.
Ideally, students and their families will want to see that an initial investment in attending college will more than pay off in terms of higher earnings when compared with earnings with only a high school degree.
Previous research has also shown that one's choice of major in college makes a big impact on ROI, with STEM degrees conferring a bigger income boost than those in the humanities. For instance, a 2023 study from the HEA Group found people who study operations research earn annual incomes of about $112,000 four years after graduation, while music majors earn about $34,000 a year.
Not surprisingly, some of the top schools for the best ROI are STEM-focused universities and colleges, ranging from Harvey Mudd to the California Institute of Technology, or CalTech.
Colleges with a lower cost of attendance also have a better ROI because students pay less over the course of their four-year degree, and tend to have lower debt. For instance, Harvard's total cost of attendance for four years is about $311,000, with a an ROI of $1,032,000, versus the U.S. Merchant Marine Academy's $24,500 total tuition cost and $1,352,000 ROI, PayScale's data shows.
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Aimee Picchi is the associate managing editor for CBS MoneyWatch, where she covers business and personal finance. She previously worked at Bloomberg News and has written for national news outlets including USA Today and Consumer Reports.
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