This story was reported and written by VPM News.
Prospective Virginia college students and their families now have access to additional data to help evaluate four-year degree programs: return on investment (ROI).
Earlier this year, the State Council of Higher Education for Virginia released a new data dashboard to show the average lifetime earnings of graduates from public institutions across the commonwealth compared to earnings for those without a degree.
The calculation attempts to determine whether specific majors are “worth it” from a financial standpoint, and whether students were able to pay off their student loans and earn more than a Virginia high school graduate does on average by the time they turn 67. It uses nearly 25 years’ worth of historical earnings data ending in 2019–20 (adjusted for inflation to 2023 values) for the calculations.
Last July, SCHEV members requested a model for measuring the return on investment of individual majors at public institutions. Tod Massa, policy analytics director for SCHEV, said he and others developed the model in-house and vetted it with economists in Virginia, and across the nation.
The highest-return degree at every public four-year university was either computer engineering, computer science or computer and information sciences. On the flip side, the lowest-ROI degrees at most schools were in the visual or performing arts, particularly those related to drama.
“I think this data has reproduced what we already know,” said David Feldman, a professor emeritus of economics at William & Mary. “Quantitative majors and quantitative programs offer a higher ROI than the humanities do.”
Feldman added that while he thinks SCHEV did a good job with the ROI methodology, he cautioned prospective students and state officials from reading too much into the numbers — and potentially overusing the data to make decisions about particular degrees.
He doesn’t think it should be used for rankings of programs at different schools for multiple reasons, including a number of data limitations. For example, the data set excludes earnings data from workers in several settings, including employees of certain nonprofits, independent contractors, federal employees and more.
The data set is also limited to workers who remained in Virginia, and does not include those who moved out of state for jobs post-graduation.
“They’re looking at a select bunch of students who went to college in Virginia and stayed in Virginia for 25 years,” Feldman told VPM News.
Feldman said the calculations also overestimate the ROI on programs whose graduates primarily migrate to high-income, but also high-cost-of-living areas like Northern Virginia — while underestimating ROI for majors with disproportionately high numbers of students going into postgraduate programs, because these students are excluded from the analyses.
SCHEV has acknowledged the metric has limitations: A section detailing them states that historical earnings data can’t necessarily guarantee future results.
Massa also said that the state doesn’t have information about what occupation or industry graduates are working in, to determine whether they’re working in their field of study or not.
He added that “there’s a lot that goes into how much a person earns.”
Massa further noted that students might acquire different skills that are completely unrelated to their college degree. He used his personal experience as an example to illustrate the point: He has a bachelor’s degree in studio art, developed programming skills in high school in the 1970s and now directs policy analytics at SCHEV.
“Not many people would have projected my return on investment,” he said. “People are different, they come from different backgrounds. They have different opportunities presented to them.”
Highest and lowest return on investment for undergraduate degrees at Virginia public universities
In March, the ROI figures were formally added as a metric by which public university courses of study can be evaluated by the state for potential discontinuation.
In recent years, there’ve been many discussions about how to incorporate wage and employment data into Virginia’s process for evaluating college programs with low enrollment.
Programs have been — and will continue to be — evaluated largely by looking at the number of students enrolling in them, and the number of students graduating from them. But the ROI adds another element that officials can use when deciding whether a course of study should or shouldn’t continue to be offered.
Alan Edwards, SCHEV’s director of academic affairs and strategic planning, told VPM News that previously, the focus has been on the state’s return on investment, not the ROI for students and families.
“The state’s focus has been traditionally on enrollments and graduates – looking backwards,” Edwards said. “Whereas the return on investment for students is about their current and future earnings.”
Under the new process, Edwards said, a program’s ROI will not trigger the identification of a course of study for potential closure, but can be a factor into the degree’s review once it has already been flagged for potential discontinuance.
Per SCHEV’s Degree-Program Productivity Policy, a course of study is flagged for review and potential discontinuance if it fails to meet its program type’s minimum five-year average of both enrollees and graduates.
The next program productivity review cycle will begin later this fall, after enrollment data for the 2025–26 academic year has been finalized. If a degree has a high ROI but low enrollment, colleges could then use the ROI to help argue for keeping it, Edwards said. On the flipside, if a major has a low ROI, SCHEV could use that in its argument to eliminate it.
SCHEV’s Joe DeFilippo, who works on postsecondary education and regulation, told VPM News that while he thinks it’s “very responsible” to ask that the degrees students are being asked to pay a lot of money for have a decent payoff in the long run, he doesn’t think the process of including ROI in decisions about whether to eliminate a major should be highly reductive.
“We have to have people making all kinds of amounts of money,” DeFilippo said. “Not everybody is going to maximize their salary. Social workers do not make a lot of money. Does that mean that we don’t want any social workers? No. We want people who are willing to do that job for that lesser amount of money. So we need a diversity of options.”
Zack Mabel, interim director at the Georgetown University Center on Education and the Workforce, agrees that the ROI information shouldn’t be used in a vacuum. The center has done its own analyses on college ROI and employment outcomes by college major.
“It’s easier to cut programs than it is to build them back,” Mabel said. “I think it’s really important to be cautious and conservative when it comes to using this information without sort of taking a broader perspective on all the different types of value that college credentials can deliver to individuals and to society.”
But at the same time, he says measures of ROI are “integral to shining a light on how students are actually able to navigate the labor market with the credential that they’ve earned,” and are part of an “increasing momentum” across the country about trying to ensure that the credentials students are paying for are going to pay off in the labor market.
The federal government is taking its own, albeit different, approach to ROI, which aims to eventually cut off access to federal student loans for students enrolled in college programs whose graduates don’t earn more than workers who never went to college.
Massa said this approach would penalize majors like early childhood education.
“I suspect there’ll be legal challenges to closing programs just because somebody doesn’t make a lot of money, and I suspect there’ll be arguments about flawed calculations on earnings,” said Massa. “That will hit all of us.”