In my previous attempt to examine the value of a prestigious college degree, I floated the idea that undergraduate prestige may be worth more in some fields than others. Anecdotally, a lot of people I’ve talked to seem to think that attending a traditionally elite university gives you a major leg up in some fields (like consulting, or finance) and doesn’t matter as much in others (ie. tech). Is there a quantitative way to examine this question?
In order to get some data on this, I looked at Vault.com’s rankings to identify the five most prestigious firms (and in theory, the most desired jobs) in each of management consulting, law, finance, the internet/social media, advertising, accounting, political lobbying, and entertainment.1 I then used LinkedIn data for each of these firms to identify what proportion of their employees have an undergraduate degree from an Ivy-Plus school (the Ivy League plus Stanford, MIT, UChicago, and Duke). With that percentage, I calculated a “prestige index”, which represents the ratio by which Ivy-Plus students are overrepresented at that firm compared to their baseline percentage of the college-educated population. For example, Ivy-Plus grads make up roughly 0.4% of U.S. college graduates and 11.2% of Bain Capital employees, so Ivy-Plus grads are overrepresented at Bain by a factor of about 25.2 In order to rank industries, I pooled data for all five firms.
This is, of course, a pretty far cry from a randomized experiment. Because prestigious schools select the type of person we would expect to perform well in the job market anyway, the prestige index for a single firm doesn’t really tell us much of anything. Even differences between industries can be partially explained by factors like selection on student interests and geographical bias. That being said, if there are noticeable intra-industry similarities and major inter-industry differences (spoiler alert: there are), that suggests to me that the credential and connections one gets from an elite school really do give students more help securing top jobs in some fields than others.
Without further ado, a ranking of industries by prestige index:
Law (Ivy-Plus percentage: 11.8%, Prestige Index: 27.0): It doesn’t shock me that this one tops the list. My intuition is that a lot of this is explained by the fact that a prestigious undergraduate degree helps you get into a prestigious law school. The top five law firms are also pretty small (500-6,000 employees) and U.S.-focused compared to the rest of the companies on this list, so that probably skews the data to some degree.
Management Consulting (Ivy-Plus percentage: 10.4%, Prestige Index: 23.9): Again, not a surprise. Consulting firms are well-known for recruiting heavily at top universities. The fact that consulting firms rank so close to law firms is pretty impressive when you consider that they are both more international and much larger than their legal counterparts.
Internet/Social Media (Ivy-Plus percentage: 6.4%, Prestige Index: 14.7): This one shocked me. Before starting this experiment, I would have bet quite a bit that tech would be much closer to the bottom of the list. The absolute percentage is not so high, but it raises my eyebrows that tech ranks higher than industries like banking, which are popularly thought to be quite elitist. Unless there is some major flaw in my process, this suggests that degree prestige may be more important to top tech firms than I originally thought.
Political Lobbying (Ivy-Plus percentage: 5.3%, Prestige Index: 12.0): I honestly expected this one to be higher, especially when one considers that a lot of K-street lobbyists have law degrees and are therefore subject to the same pressures as lawyers at the top law firms.
Banking (Ivy-Plus percentage: 4.9%, Prestige Index: 11.2): Again, a surprisingly low ranking, although it’s worth pointing out that there are a couple of outlier firms. Is the Ivy-Wall Street pipeline weaker than it’s popularly perceived to be?
Entertainment (Ivy-Plus percentage: 1.2%, Prestige Index: 2.8): I didn’t expect to see entertainment companies ranked above the more-corporate accounting and advertising, but the numbers are low enough at this point that elite schools are barely overrepresented at all.
Accounting (Ivy-Plus percentage: 0.80%, Prestige Index: 1.8): Again, somewhat of a surprise. The Big Four accounting firms are in many ways very similar to the Big Three management consulting firms. It seems significant that one has a 13x larger proportion of employees from Ivy-Plus schools. It’s worth pointing out that the accounting firms seemed to be, in general, more international than the other companies in my data. This probably depresses their numbers a little bit.
Advertising (Ivy-Plus percentage: 0.76%, Prestige Index: 1.7): Interesting mostly because of how small the numbers get. I computed the prestige index against the population of all college grads, but if it was possible to restrict the comparison to college grads in major cities I suspect that Ivy-Plus students might be underrepresented at top advertising firms.
I think the most striking thing about this list is how much variance there is between industries. If most sectors had a medium-high prestige index I might have shrugged my shoulders and assumed most of what I was picking up was a correlation between Ivy-Plus grads, living in New York City, and working at a prestigious firm. The fact that industries which in theory require similar competencies (ie. management consulting and accounting/business services) have very different indices suggests that there are some real differences in how different sectors recruit students from elite schools. It’s unclear exactly what mechanisms are at play here; my best guess is that the overrepresentation of students with prestigious degrees at the top of some industries reflects a self-reinforcing combination of preference for those degrees, strong connections with university career offices, and a high level of visibility among students.
The second big shock for me was how high the tech industry is ranked. Much hay has been made of Silicon Valley’s anti-credentialism, but they sure seem to recruit a lot more Ivy-Plus students than standard corporate accounting and advertising firms.
On to the companies themselves. Here’s the ranking of every firm I collected data on:
Centerview [Banking] (Ivy-Plus percentage: 30.9%, Prestige Index: 70.6)
Wachtell, Lipton, Rosen & Katz [Law] (Ivy-Plus percentage: 24.8%, Prestige Index: 56.8)
Cravath, Swain & Moore [Law] (Ivy-Plus percentage: 17.9%, Prestige Index: 40.9)
Sullivan & Cromwell [Law] (Ivy-Plus percentage: 14.1%, Prestige Index: 32.3)
Evercore [Banking] (Ivy-Plus percentage: 13.2%, Prestige Index: 30.1)
Skadden, Arps, Slate, Meagher & Flom [Law] (Ivy-Plus percentage: 11.3%, Prestige Index: 25.8)
Bain [Management Consulting] (Ivy-Plus percentage: 11.2%, Prestige Index: 25.5)
McKinsey [Management Consulting] (Ivy-Plus percentage: 10.5%, Prestige Index: 24.1)
Boston Consulting Group [Management Consulting] (Ivy-Plus percentage: 10.0%, Prestige Index: 22.7)
Latham & Watkins [Law] (Ivy-Plus percentage: 9.1%, Prestige Index: 20.8)
Twitter [Internet/Social Media] (Ivy-Plus percentage: 8.3%, Prestige Index: 18.9)
Facebook [Internet/Social Media] (Ivy-Plus percentage: 7.9%, Prestige Index: 18.2)
Akin, Gump, Strauss, Hauer & Feld [Political Lobbying] (Ivy-Plus percentage: 6.9%, Prestige Index: 15.7)
Goldman Sachs [Banking] (Ivy-Plus percentage: 6.8%, Prestige Index: 15.5)
LinkedIn [Internet/Social Media] (Ivy-Plus percentage: 6.0%, Prestige Index: 13.8)
Google [Internet/Social Media] (Ivy-Plus percentage: 5.9%, Prestige Index: 13.5)
Netflix [Internet/Social Media] (Ivy-Plus percentage: 5.5%, Prestige Index: 12.6)
Holland & Knight [Political Lobbying] (Ivy-Plus percentage: 4.8%, Prestige Index: 10.9)
Cornerstone Government Affairs [Political Lobbying] (Ivy-Plus percentage: 4.3%, Prestige Index: 9.8)
Morgan Stanley [Banking] (Ivy-Plus percentage: 4.3%, Prestige Index: 9.8)
J.P. Morgan [Banking] (Ivy-Plus percentage: 3.4%, Prestige Index: 7.8)
Brownstein, Hyatt, Farber, Schreck [Political Lobbying] (Ivy-Plus percentage: 3.4%, Prestige Index: 7.8)
Warner Media [Entertainment] (Ivy-Plus percentage: 2.6%, Prestige Index: 5.9)
BGR Group [Political Lobbying] (Ivy-Plus percentage: 2.3%, Prestige Index: 5.3)
NBC Universal [Entertainment] (Ivy-Plus percentage: 1.8%, Prestige Index: 4.1)
Interpublic Group [Advertising] (Ivy-Plus percentage: 1.1%, Prestige Index: 2.6)
KPMG LLP [Accounting] (Ivy-Plus percentage: 1.0%, Prestige Index: 2.3)
MDC Partners [Advertising] (Ivy-Plus percentage: 1.0%, Prestige Index: 2.3)
21st Century Fox [Entertainment] (Ivy-Plus percentage: 1.0%, Prestige Index: 2.2)
Deloitte [Accounting] (Ivy-Plus percentage: 0.9%, Prestige Index: 2.0)
Walt Disney Company [Entertainment] (Ivy-Plus percentage: 0.8%, Prestige Index: 1.9)
WPP [Advertising] (Ivy-Plus percentage: 0.7%, Prestige Index: 1.7)
Pricewaterhouse Coopers [Accounting] (Ivy-Plus percentage: 0.7%, Prestige Index: 1.7)
Ernst & Young [Accounting] (Ivy-Plus percentage: 0.7%, Prestige Index: 1.7)
McCann Worldgroup [Advertising] (Ivy-Plus percentage: 0.7%, Prestige Index: 1.7)
Grant Thorton LLP [Accounting] (Ivy-Plus percentage: 0.7%, Prestige Index: 1.5)
Omnicom Group [Advertising] (Ivy-Plus percentage: 0.7%, Prestige Index: 1.5)
The individual firm data makes me more confident in the internal consistency of the study. There seem to be clear clusters by industry. In other words, the differences between industries seem to be the result of real sector-wide trends rather than unusually high numbers at one firm or another.
Overall, I think this data has somewhat complicated implications for the value of a prestigious undergraduate degree. On one hand, there seems to be a clear pipeline from Ivy-Plus schools to certain industries. I think it’s likely that matched-applicant studies which purport to show no effect of attending a selective school on future income, conditional on acceptance, are underrating the unique advantage that prestigious schools give students looking to go into these fields. On the other hand, the absolute percentages of Ivy-Plus graduates at these firms aren’t that high.3 Plenty of students from less-selective schools seem to be doing pretty well.
I used less than five firms in the case of consulting (three) and entertainment (four) because there was a clear demarcation line between these firms and everything else. I also excluded Amazon (ranked first) from the internet/social media ranking because their LinkedIn page included an unusually high number of non-corporate employees. Finally, Vault doesn’t rank lobbying firms, so I was forced to use this list from POLITICO.
This number includes only graduates of U.S. colleges, so it will be low for firms that recruit heavily overseas.
Although I am very dubious about interpreting the absolute numbers given the general haphazardness of this experiment.