Here's How We Ranked The Most Underrated Colleges In America

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We recently came out with our list of the Most Underrated Colleges In America.

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To determine which schools were underrated, we considered two factors: reputation and future earnings. We figured that schools with bad or obscure reputations but whose students made high salaries would be underrated.

We used the following rankings to compile this list:

We specifically looked for schools that had relatively low rankings on the U.S. News list but whose students had high mid-career salaries (PayScale based the latter on employees with a bachelor's degree who have at least 10 years of experience).

We combined these two rankings to find the schools that met our criteria as "underrated" - 316 universities and liberal arts colleges showed up in both the U.S. News and PayScale rankings. 

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The chart below shows the relationship between the two rankings. Each point represents one school, with a school's position on the horizontal axis showing its U.S. News ranking and its position on the vertical axis showing its PayScale ranking.

For both, lower number ranks indicate a better score on each metric, so the best U.S. News scores are on the left and the best PayScale mid-career salaries are on the bottom:

us news vs payscale

Business Insider/Andy Kiersz, data from U.S. News & World Report and PayScale

There is a moderate linear relationship between the two rankings: Schools with better U.S. News rankings tend to also have better mid-career salaries, according to PayScale. That relationship is reflected in the red regression line and the corresponding formula in the upper-right corner.

Schools that fall along the red regression line are properly ranked. As can be seen in the chart below, there are a lot of schools that are far away from the regression line. These outliers are the schools we are most interested in - namely, the underrated schools, in green, which have a poor U.S. News ranking but a high graduate-salary ranking.

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over and under rated colleges fixed

Business Insider/Andy Kiersz, data from U.S. News & World Report and PayScale

Our regression line also makes it possible to come up with a quantifiable measure of just how underrated or overrated a school is: the vertical distance between the point and the regression line (called the residual in regression analysis). Really large negative residuals indicate very underrated schools. The smaller the residual, the closer the school is to being properly ranked.

analyzing residuals chart

Business Insider/Andy Kiersz, data from U.S. News & World Report and PayScale

Our ranking, then, is based on those residuals. The most underrated colleges and universities in America are those with the largest negative residuals: schools whose graduates make much higher salaries than their U.S. News rankings would suggest.


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