Phi Beta Cons

Too Good to Be True

A new survey from NACE seems to overstate the career success of new graduates.

Today, the National Association of Colleges and Employers (NACE) released a study showing that the mean starting salary for recent graduates from 4-year institutions who have found employment is $48,190. Entitled, “First Destinations for the College Class of 2014,” the study surveyed 274,000 new bachelor’s and associate’s degree recipients.

If accurate, the survey’s results are reason to celebrate. After all, it was just two years ago that economist Rich Vedder showed that many college graduates are underemployed—often taking low-paying jobs that high school graduates could do. And my own analysis of arts and humanities majors revealed dismal employment results even five years after graduation.

But I suspect that the results are too good to be true. One figure in particular that caught my attention was the salary figure for Visual & Performing Arts majors—a field in which it is notoriously difficult to achieve financial success. The reported mean starting salary is $36,222—far more than I expected for recent graduates working backstage, fighting for bit parts, or performing an occasional “gig” while working part-time at Starbucks.

For a comparison, I consulted the figures for the same major from NCTower.com—a website that uses data from the North Carolina Department of Commerce and the 16-university UNC system. On that website, the mean annual wage one year after graduation for a student who graduated in 2012 with a degree in Visual & Performing Arts was $13,920. To be sure, this figure is a little low; it includes wages of all graduates who are working, including those who have gone on to graduate school and are putting in just an hour or two or during the summer. But even five years after graduation, after grad school has presumably been finished, 2008 graduates with those degrees only earned $26,071.

That’s quite a difference from the $36,000 starting salary reported by the NACE survey.

I suspect the reason is in the methodology. Because NACE uses a survey, it is prone to selection bias. Students who are successful are more likely to return the survey. To their credit, NACE verified data as much as possible by using LinkedIn and employer contacts. Despite that, the “knowledge rate” for the study’s bachelor’s degree findings was only 65.7 percent.  NACE defines the “knowledge rate” as the “percentage of the graduating class for which an outcomes destination is known…It excludes those students for whom no information is available.

I believe that it is highly likely that the 34 percent of students about whom no information is available are significantly different in job placements than their peers who turned in the survey. After all, wouldn’t you rather report back to your alma mater that you work at a prestigious financial firm than at Starbucks? Moreover, it was universities that actually administered and collected surveys. The incentive to “overlook” graduates who are underemployed would have been strong.

The full report is available here.

Jenna A. RobinsonJenna Ashley Robinson is the president of the John W. Pope Center for Higher Education Policy. Before becoming president, she was the center's director of outreach. She was previously the ...

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