Flaws revealed in PayScale ranking

Seton Hill University (SHU) was named second biggest “ripoff ” in an article in “Business Insider” April 12. The article was based on the return on investment (ROI) calculations by a website named PayScale.com. Articles were also published by several news sources including the Chronicle of Education and Yahoo! about the findings.

“Small state colleges and small religious colleges offer the worst bang for your buck, according to new analysis from PayScale,” said Abby Rogers, the author of the Business Insider article. “Pay- Scale also found that the best investments are elite universities and tech schools.”

“The problem I have with this ‘study’ is the way they purposely chose to inflate their methodological flaws in order to achieve and publicize their rankings. This Payscale ROI report has deservedly been called ‘useless,’ ‘a piece of illogic’ and is accused of having ‘shamefully bad reasoning’ by researchers,” said Edith Cook, SHU’s institutional researcher who looked into the study.

The “worst” school for ROI, according PayScale, was Savannah College of Art and Design with a rating of -$189,000. SHU’s ROI rating was listed as -$186,000 after 30 years taking into consideration the cost of attending SHU and the median annual salary of alumni. According to Cook, however, they failed to take into consideration some important factors into their research.

“All economic models are necessarily based on a lot of assumptions, and researchers nor- mally do their best to recognize the flaws and adjust their interpretation of the findings accordingly,” said Cook.
Payscale is an online salary comparison service rather than an education or research institution. They are financially supported by offering companies online salary comparisons.

The study failed to take into account aspects like financial aid.

“They assumed that our students pay $160,200 for their education. Therefore, schools like ours that provide generous financial aid far much worse than state universities and many other schools that don’t offer as many scholarships,” said Cook.

Payscale also didn’t account for graduate students and gender factors.

“Unfortunately, mid-career salaries for women graduating 30 years ago tend to be lower than average based on societal factors,” said Cook.

The other “worst” schools included Judson University, Medialle College and Meredith College, respectively. The “best” schools were Princeton University, Stanford University, Massachusetts Institute University, California Institute of Technology and Harvey Mudd College.

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