The Gates Foundation Introduces Its New College Comparison Tool

As an outgrowth of work by the Bill and Melinda Gates Foundation’s Postsecondary Value Commission, students and other higher education constituents now have a new interactive tool they can use to compare colleges and universities on a host of important outcomes.

The new tool, released to the public on November 4, is the Equitable Value Explorer. It’s a slick, user-friendly website that students can study to evaluate more than 4,000 colleges and universities on factors such as racial composition of the student body, net cumulative price of attendance, completion rates, the percentage of students receiving Pell Grants, and median earnings ten years after enrollment.

The tool will help college leaders and higher ed policy makers evaluate the economic return that schools are delivering to students, and it also highlights the improvements needed in institutional data to achieve a better understanding of how to strengthen postsecondary outcomes.

A main aim of the initiative is to help higher education leaders “know their numbers” so they can implement evidence-based policies promoting economic mobility and social equity, particularly for racial and ethnic minorities and students from low-income households.

Mamie Voight, interim president of the Institute for Higher Education Policy and managing partner of the Postsecondary Value Commission, said the tool is intended to help institutions use data so they can “provide quality, affordable credentials that offer students a better living and a better life – all in the interest of advancing the commission’s objective of promoting a more fair and just society.”

The Equitable Value Explorer is built on publicly available data, including the federal College Scorecard, the Integrated Postsecondary Education Data System (IPEDS), and data provided by the University of Texas (UT) system.

Among its unique and more revealing metrics is the concept of “economic value thresholds,” which refer to how much greater the earnings of students attending a given college will be on average compared to different earnings thresholds.

• The lowest threshold is the Minimum Economic Return, which is equal to the median earnings of high school graduates in the state plus the total net price of attending a given postsecondary institution amortized over 10 years.
• The next threshold is the Earnings Premium, calculated as the median earnings for a given postsecondary credential (e.g., AA or BA degree) within the state.
• The Earnings Parity threshold is set as the median earnings of advantaged peers (White, Male) for a given credential level within the state. 
• The highest threshold is termed economic mobility, which is equal to earnings that are high enough for a person to place in the 60th to 80th percentile of income or above regardless of credential level within the state.

Here’s an example using one of these thresholds. How much of an annual premium over the lowest threshold – minimum economic return – would the average graduate of each Ivy League institution realize?

• Harvard – $45,578
• Dartmouth – $44,599
• Brown – $43,639
• University of Pennsylvania – $40,118
• Yale – $39,233
• Columbia – $39,059
• Princeton – $32,965
• Cornell – $30,406

Here’s another example: Which institutions in the state of Iowa yield the best and worst annual premiums compared to the minimum economic return threshold? (This question can be answered for every state.)

Among the dozens of Iowa schools included, Drake University ($18,463), Iowa State University ($17,729) and the University of Iowa ($17,503) deliver the highest premiums.

The three lowest returns on investment, all of which were lower than the minimum economic return threshold were from the Maharishi University of Management (-$12,823), Clarke University (-$3,280) and Iowa Wesleyan University (-$1,992).

The tool also comes with three caveats for users.

First, the context of an institution – its mission, state policy and financial support, local and regional labor market conditions, and history – must be kept it mind when evaluating financial value.

Second, the data are incomplete so they must be interpreted cautiously. For example, median earnings and the threshold comparisons are not available at the program level.

Third, the tool displays outcomes but does not assign causes. It was not designed to influence college rankings, penalize institutions, or make claims about what causes certain outcomes.

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The national Postsecondary Value Commission was supported by the Bill & Melinda Gates Foundation and managed by the Institute for Higher Education Policy (IHEP). Formed in 2019, the Commission is made up of 30 diverse leaders representing colleges and universities, policymakers, advocates, researchers, the business community and students.

In its final report, released in May, 2021, the commission recommended a new approach to measuring postsecondary value along with a number of suggestions for how colleges and universities could provide more equitable outcomes for students after high school. 

The Equitable Value Explorer represents that new approach. It’s an excellent addition to the information that higher ed consumers and leaders can use to examine both the value and the needed improvements of postsecondary education.