Social Mobility Index

Opportunity through US Higher Education

SMI Purpose

  • Purpose

    The chief goal of the Social Mobility Index (SMI) is to stimulate policy changes within US higher education to help arrest the dangerous and growing economic divergence between rich and poor in our country.

    As reported in Science magazine in May, 2014, despite the political rhetoric around opportunity, the US now provides the LEAST economic mobility among developed nations worldwide.

    MIT Economist David Autor:  “…among a set of 13 OECD member countries for which consistent data are available …the United States has both the lowest mobility and highest inequality among all wealthy democratic countries.” http://m.sciencemag.org/content/344/6186/843.full#ref-6

    Not only has the gap in the US between rich and poor grown since the Great Recession, it has reached proportions matching the Belle Epoque in Europe, a period whose growing economic disparities contributed to the onset of the Great Depression and two world wars. By crumbling infrastructure, destroying asset values, and forcing high taxation to pay for war efforts, these cataclysmic events reversed the divergence of economic and social classes. But this early 20th century movement towards convergence shifted back again to economic divergence in the 1980’s, most aggressively in the United States.

    Thomas Piketty opines in Capital in the 21st Century that contrary to the thesis of Marx, capitalism may not be inevitably divergent because it does not operate in a vacuum of social and economic policy. Getting policies right can provide essential buffering against social instability. As shown today in several European countries, particularly Scandinavia, ensuring broad access to education can help countervail against divergence and contribute to economic mobility. But achieving this in only one region of the world does not ensure it for the rest of the world. If we learned anything from the global fallout of the Great Recession, it was that getting economic policy right in the US may be necessary for long term world stability.

    So while the much publicized student debt overhang, now in excess of $1 trillion, imposes distress and financial burden on millions of students and families, it is a symptom of the much greater problem of economic and social divergence in our country. The good news is that colleges and universities carry great potential to powerfully address this problem.

    Economist Thomas Piketty: “the principal force for convergence [reduction of inequality] – the diffusion of knowledge – …depends in large part on educational policies, access to training and to the acquisition of appropriate skills, and associated institutions.” Capital in the 21st Century, pp. 21-2

    If colleges can begin aggressively shifting policy towards increasing access to higher education, particularly for economically disadvantaged students and families, they will establish themselves as a key force for economic and social convergence. Unfortunately, as the SMI rankings reveal, the opposite is occurring. Pursuing false prestige in popular periodicals, many schools are wasting money and time groveling to each other for recognition in so-called peer assessments. In the meantime, a great civic opportunity and service for higher education—ramping access for the economically disadvantaged—goes lacking. By acknowledging those schools that are already providing pathways for social and economic mobility, we hope the SMI will stimulate other schools to move beyond opportunity rhetoric towards meaningful action.

  • Contrasting SMI methodology with other higher education ranking methods.

    Unlike the popular periodicals, we did not arbitrarily assign a percentage weight to the five variables in the SMI formula and add those values together to obtain a score. The relative weight of any variable was established by testing how much a realistic change in the value of that variable would move a school within a set of rankings derived from real data. Accordingly, the greatest sensitivity for movement in the SMI rankings comes from making changes in tuition or making changes in the percentage of students within the student body whose family incomes are less than or equal to the national median--$48,000. Simply put, a school can most dramatically move itself upwards in the SMI rankings by lowering its tuition or increasing its percentage of economically disadvantaged students (or both).

    While tuition and economic background of the student body are the most sensitive variables in the SMI, three other variables in descending order of sensitivity are also critical. These are: graduation rate, early career salary, and endowment. While capable of producing big movements, graduation rate and early career salary carry approximately ½ the sensitivity of the first two variables. The rationale for this is not only that tuition and economic background are the most critical front end determinants for access, they are also the two variables over which policy makers have almost 100 percent, decisive control. By contrast, improving early career salary or graduation rate—critical outcomes to economic mobility-- require more substantial policy and system changes over a longer term. Finally, endowment carries ½ the sensitivity of the outcome variables. Although a strong indicator of power to act, endowment primarily serves a “tie-breaking” role in the SMI as explained below.

    The relative sensitivity of the variables in the 2014 SMI are as follows:

    Variable Sensitivity
    Tuition 126
    Economic Background 125
    Graduation Rate 66
    Early Career Salary 65
    Endowment 30

    The integer associated with each variable indicates the average absolute position change each school experienced during testing when that variable was held constant. This sensitivity effect also works in reverse. That is, if the SMI formula had been calculated devoid of tuition to establish a ranking and then real tuition numbers were added back into the formula, each school’s position would have changed, on average, by 126 places. Policy makers should note that the higher the sensitivity of an SMI variable, the more likely changes to that variable will advance a school’s SMI ranking.

    Among the five variables, two of them—tuition and endowment—carry an inverse effect. That is, the higher the tuition, the lower the SMI ranking. Although it is the least sensitive of all five variables, endowment works in the same inverse direction within the formula in the sense that hoarding endowment monies countervails against high SMI ranking. The basic logic is that all things otherwise being equal in the SMI between school A and school B, if school A has lower endowment than B, then school A is doing its work more efficiently. By virtue of its larger endowment, B has untapped potential to do more and therefore will appear slightly lower in the rankings than A. This view of the endowment corpus is the opposite of that taken by popular periodicals where stockpiling and sitting on endowment money is somehow taken as a measure of goodness and “prestige.”

  • Source of Data

    Data are collected from third party sources including Payscale, Inc., IPEDS, and NACUBO (endowment)

  • Excluded Variables

    Unlike other rankings that rely on reputation surveys, SMI dismisses altogether the use of such data. Factoring in “opinions” from college faculty or administrators about social or economic mobility would only perpetuate the biases and stereotypes collected in such surveys. Our effort is aimed at defining an “economic mobility” index on an independent, accountable, and quantitative basis.

    Retention data such as the freshman dropout rate are very important indicators of student engagement and no doubt indicate progress towards learning and economic mobility. But in the final analysis, graduating into paying jobs evidences economic mobility. Therefore, we subsume retention metrics by incorporating graduation rates in the SMI.

    Variables such as reduced class size and higher faculty salaries (as a supposed measure of “prestige”) are relevant, if at all, only in that they drive costs and tuition higher. Wasted attention to “improving” such variables countervails student access. One egregious example of policy sycophancy to the periodical rankings has a noted university mandating no class sizes beyond 19 despite a student body of 16,000 (19 is a cutoff for the periodical in terms of evidencing “small class” sizes). Not only is there no research to support that 19 students vs 20 vs 30 in a college setting carries any impact on learning outcomes, such arbitrary measures clearly increase costs and jeopardize accessibility. Another egregious example of periodical ranking sycophancy is a noted institution soliciting its graduates for $5 donations so as to “prove” widespread support of the institution for the rankings. The pitch averred that the more graduates who so contributed, the greater would be the “value” of their degree. None of the data around such self-aggrandizing “policy” has anything to do with a university’s responsibility and role in addressing the national problem of economic mobility.

    Student “selectivity”—i.e. SAT/ACT scores at admission—is irrelevant to measuring social mobility. In fact, since SAT/ACT scores correlate with high family income, it may be the case statistically that high entrance test scores could serve as a counter indicator as to whether a school is effective at recruiting and advancing students who are economically disadvantaged. Another argument against focusing on SAT/ACT scores could be that a college’s contribution to social and economic mobility is greater when it is the college that has been genuinely responsible for improvements in the student’s “aptitude,” not an applicant’s prep school or test prep course. Until there is widespread adoption of the CLA (Collegiate Learning Assessment) or some equivalent, data on aptitude improvement during the college experience remain unavailable. We therefore exclude any use of standardized test scores.

  • Why Salary Matters

    It is a canard that education resulting in “good jobs” must necessarily be illiberal. We agree that undergraduate education, in particular, should support intellectual roaming. Fortunately, core requirements for undergraduates at most institutions encourage a diverse foundation of coursework. As we continue to move deeper into a knowledge economy, smart employers will increasingly recognize that the likelihood for quality work is enhanced by broad knowledge and skills. Metaphor is the partner of creativity and invention, and students who study most broadly carry the greatest potential for innovation. As far as we know, there is no research that demonstrates that achieving a high salary upon graduation correlates with experiencing a limited range of intellectual exploration and skill development during college. A high salary is only a proxy to be sure, but a validator nonetheless of a student’s success at intellectual and skill development.

    Other ranking systems abound. Our focus in developing the SMI is to comparatively assess the role of our higher education system in providing a conduit for economic and social advancement. While some other ranking system might value as “good” a circumstance where all the graduates of a given institution take low paying jobs in, say, civil service, it is not our intent to measure that good and certainly not our intent to deny it as a good. Many other ranking systems exist to measure many other “goods.” Despite its broad national importance, the good we seek to measure is more narrow: the extent to which colleges and universities contribute to solving the problem of economic divergence in our country.

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Frequently Asked Questions

Information about the SMI

  • Why is there a need for a college ranking like the SMI?

    This past May, Science published a disturbing finding: Among developed nations, the United States now provides the least economic opportunity and mobility for its citizens. Not only is economic mobility constrained in the US, the gap between rich and poor is now as large as it was in Europe during the Belle Epoque – an unsustainable period of inequality that finally collapsed under the weight of the Great Depression and two world wars. http://www.sciencemag.org/site/special/inequality/

  • How could such economic immobility and inequality develop in the US, the "land of opportunity?"

    One major factor has been the erosion of higher education's historic civic mission in favor of a new mission: spending for glory in USNews’ rankings. Despite unease with this hollow pursuit, colleges nevertheless obeisantly seek to make classes smaller, enroll more students with high test scores (i.e., those from richer families), hoard endowments, build expensive facilities, and market themselves to each other for favor in "peer assessments." The resulting tuition bomb has not only suppressed access, it has locked a $1.1 trillion ball and chain around the ankles of those who were "lucky" enough to attend college. Whether tuition can now be lowered and access to higher education opened to the economically disadvantaged will be a powerful determinant of whether we can make good as a society on restoring broad promise for economic opportunity.

  • How is the SMI different from other college rankings?

    The SMI differs from most other rankings in that it focuses directly and broadly on the problem of economic mobility. To what extent does a college or university educate more economically disadvantaged people (family incomes below the national median) at lower tuition so that they graduate into good paying jobs? The colleges that do the best at this rank higher according to the SMI. Gone is any quixotic pretense of "best" college based on arbitrary or irrelevant popularity criteria such as percentage of applicants denied.

    Put another way – Is one college "better" than another because it turns away more students? Or is it "better" because it draws in and hoards more endowment money? Or is it "better" because other college administrators say it is? These criteria only mirror popular sentiment, and preoccupation with them amounts to a zero-sum game of institutional narcissism. The only winners are the publications harvesting "eyeballs" and advertising dollars. Everybody else loses: students; indebted families; our nation's economic and social stability; and higher education's credibility for critical thought and civic purpose.

  • What is the methodology for the SMI?

    The SMI is computed from five variables: published tuition, percent of student body whose families are below the US median income, graduation rate, reported median salary 0-5 years after graduation, and endowment. Unlike other rankings that assign percentages to variables and then sum for a score, the SMI variables are mathematically balanced against live data so that they fall into three weighting tiers: a) tuition and economic disadvantage at the highest tier (access); b) graduation rate and salary at the next, half-weight tier (outcome); and c) the endowment at a half again, or 1/4 weight tier (institutional capability). Each weighting tier is thus twice as "sensitive" as the next in that making realistic changes to the variables at that tier can cause approximately twice as much movement in the rankings as changes to the next tier's variables.

  • Why did you choose this particular methodology?

    Enhancing economic mobility means providing access to economically disadvantaged students, graduating them, and moving them into good paying jobs. Each tier constitutes a proxy for one of three concepts: access, outcome, and institutional capability. Considering these tiers in reverse helps explain the intuition behind their weightings. The bigger endowment a university possesses, the more capability it has to address any problem. Yet because drawdowns on an endowment can be aimed at purposes separate from the problem of economic mobility, endowment primarily serves in the SMI as a tie-breaker. If school A and school B are very close with respect to social mobility policy, yet B has a larger endowment, A is rewarded by the SMI for having applied its resources more efficiently.

    Optimizing outcomes is key to economic mobility, hence the heavier weighting in this tier. Yet no matter how many students are graduated and then acquire good paying jobs, economic mobility is suppressed if tuition in the US continues to ramp unchecked. Students and families cannot advance economically if they must labor under huge debt. And, of course, no matter how high the graduation rate and no matter how high the early career salary, if higher education serves primarily as a finishing school for scions of the privileged, then economic mobility goes unaddressed. That is why the access proxy (tuition and economic background) is assigned the greatest weighting. Lowering tuition and recruiting more economically disadvantaged students to participate in higher education is the basis for improving economic mobility.

  • What does a high SMI ranking mean?

    A high SMI ranking means that a college is contributing in a responsible way to solving the dangerous problem of economic immobility in our country.

  • What does a low SMI ranking mean?

    Just the opposite. All schools adopt the rhetoric of access and opportunity. But a school with a low SMI is more likely to be failing, sometimes miserably, at providing real opportunity and advancement for the economically disadvantaged citizens of our country. A low SMI asks: why should "prestige" any longer be affixed to an institution that openly pursues a self-aggrandizing climb through arbitrary "prestige" ranking schemes that even their own administrators openly and widely criticize? It is time for presidents and regents at low SMI institutions to read their mission statements more closely, get behind solving an important national problem, and make policy changes that help justify the taxpayer support and exemptions they receive.

  • What should colleges and universities take away from their individual SMI rankings?

    The SMI should serve as a valuable mirror for policy, an instigator of conversations with institutions that are doing a better job, and a stimulant for policy change.

  • What should students and their families take away from the SMI rankings?

    If a student wants to pursue academics in an institution that models awareness and civic responsibility, the SMI can provide a valuable guide. In the end, the greatest returns to self from work, academic or otherwise, come from delivering benefits to family, nation, and our world. Families and students who understand this, and want to move up efficiently to a position of social and economic influence in our country will gravitate to high SMI schools.

  • How can the SMI rankings change higher education?

    The SMI rankings cannot by themselves change anything about higher education. But to the extent they provide a new barometer for policy and renewed attention to institutional civic responsibility, they can be part of improving both economic opportunity and social stability in our country.

  • Will new SMI rankings be released each year going forward?



    Early-Career Salary: Combines base annual salary or hourly wage, bonuses, profit sharing, tips, commissions, overtime, and other forms of cash earnings, as applicable. Salary does not include equity (stock) compensation, which can be a significant portion of pay for some executive and high-tech jobs. In addition, salary does not include cash value of retirement benefits, or value of other non-cash benefits (e.g. healthcare).

    Early-Career Employees: These are full-time employees with five years of experience or less in their career or field working in the U.S. who hold a bachelor's degree and no higher degrees. This sample does not include U.S. territories, such as Puerto Rico or Guam. The typical (median) early-career employee is 27 years old and has two years of experience.

    Bachelor's Only: Only employees who possess a bachelor's degree and no higher degrees are included. This means bachelor's degree graduates who go on to earn a master's degree, M.B.A., M.D., J.D., Ph.D., or other advanced degrees are not included.

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