<p>Revenge of the Nerds</p>
<p>Despite the fame of private schools like Harvard, Yale, Stanford and Duke, and the numerous loyal alumni of state school powerhouses like the University of California, Michigan, and Texas, the top earning bachelor’s graduates for the last two years have hailed from the smallest Ivy League institution, Dartmouth College in the mountains of Hanover, New Hampshire.</p>
<p>What are the factors that have made Dartmouth #1:</p>
<pre><code>* Strong programs in engineering and computer science, majors with perennially well-paid graduates
- A large number of alums who migrate to high wage areas like New York, Boston, and the San Francisco bay area
- A substantial number of graduates working in financial services (read, “Wall Street”)
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<p>These factors are why Dartmouth has been able to nose out more famous college competitors for top honors for mid-career pay.</p>
<p>The “great recession” has changed things: the center of top earnings has moved about as far as you can go in the continental US from cold New Hampshire.</p>
<p>This year, the top earning school is tiny Harvey Mudd College in sunny southern California. While small, Harvey Mudd is a very selective institution, only taking high school grads with outstanding records and a strong interest in engineering, math, or science, the only fields of study it offers.</p>
<p>While the recession has been hard across the board, graduates working in engineering and information technology have not been as hard hit as college graduates with less specific skills.</p>
<p>Despite the bad publicity about large bonuses at a few of the largest investment banks at the end of 2009, financial services more generally, particularly in home, construction, and personal loans, remains weak. Since this has traditionally been an area of high earnings for liberal arts grads, weakness here would tend to hit graduates of a diverse liberal arts college like Dartmouth with less technical degrees.</p>
<p>In the end of the day, the admittedly small change – ~5% swing between Harvey Mudd and Dartmouth between last and this year – could be caused by:</p>
<pre><code>* Stronger job market and pay for engineering and science grads
- Pay holding up better in California for engineers than liberal arts grad in New York
- A statistical fluctuation
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<p>Let’s face it; these mid-career medians, particularly at elite schools, are the middle of a very broad distribution. For example, even though the median is $123,000/year for Dartmouth,</p>
<pre><code>* 25% of Dartmouth grads earn less than ~$85,000/year (25th percentile)
- 25% earn more than ~$200,000/year at mid-career (75th percentile)
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<p>The $3,000/year the Dartmouth median is behind that of Harvey Mudd College graduates is really not a large factor, compared to the huge diversity in pay between graduates at each school.</p>
<p>Interestingly enough, as we see typically for engineering schools, the Harvey Mudd grads have a somewhat narrow range of pay: the 25th percentile is ~$100,000/year and the 75th percentile is ~$150,000/year.</p>
<p>The upshot is that the Dartmouth education creates graduates with the potential to earn much more than the typical Harvey Mudd graduate, while the Harvey Mudd education puts a floor under earnings that is significantly higher than that at Dartmouth College. In a weak economy, having the floor is an advantage.</p>