Who benefits from attending elite universities? Family background and graduates’ career trajectories

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Abstract

The literature on social stratification has paid considerable attention to whether and to what extent attending prestigious universities is beneficial for graduates’ labor market returns. This paper contributes to the literature by applying a more dynamic perspective in asking whether graduates from prestigious and less prestigious universities differ in their career progression across fourteen years since labor market entry. It further investigates whether graduating from prestigious universities pays off more or less for graduates from different educational backgrounds. While the positive selection hypothesis suggests that students most likely to attend prestigious universities will benefit the most, the negative selection hypothesis suggests the opposite. Using multilevel growth curve modeling and the 1970 British Cohort Study (N = 939), the findings show no discernible differences in occupational prestige between graduates from diverse universities. If at all, there is a small Russell Group premium restricted to the early working career. This early Russell Group premium is mainly found among first-generation graduates providing evidence for the negative selection hypothesis.

Introduction

Research on the labor market consequences of horizontal stratification in postsecondary education has given much attention to whether and to what extent attending prestigious universities is beneficial for graduates’ labor market returns (Gerber & Cheung, 2008). Studies commonly rank higher education institutions either by ‘college quality’ - a multidimensional construct including various factors such as mean standardized test scores, expenditures per full-time students, and quality of teaching or facilities, or ‘college selectivity’. The latter focuses entirely on mean test scores at admission and is considered a much more accurate measure of institutional prestige (Witteveen & Attewell, 2017). Regardless of differences in measurement, evidence for a causal relationship between institutional prestige and labor market outcomes remains ambiguous. Some US studies found significant positive earnings effects (Brewer, Eide, & Ehrenberg, 1999; Hoekstra, 2009; Loury & Garman, 1995; Witteveen & Attewell, 2017) or an advantage in occupational status (Brand & Halaby, 2006) of the prestige of the institution attended, but other studies did not find effects on earnings (Dale & Krueger, 2002, 2014; Long, 2008). Similarly, for the UK, a few studies showed a wage premium of attending selective universities (Belfield et al., 2018; Broecke, 2012; Chevalier & Conlon, 2003; Hussain, McNally, & Shqiponja, 2009), but others were unable to detect differences in labor market outcomes (Sullivan, Parsons, Green, Wiggins, & Ploubidis, 2018; Walker & Zhu, 2018).

However, most existing studies relied on single snapshot measures of labor market outcomes and did not apply a longitudinal and dynamic perspective on how the prestige of the higher education institution shapes graduates’ career progression (Gerber & Cheung, 2008). Graduates from prestigious institutions may have an advantage in returns at labor market entry over graduates from non-prestigious institutions, but this advantage may decrease over time, remain stable, or even increase across the career. Studies that found no returns to college prestige at labor market entry also do not know whether returns emerge later in the career (Thomas & Zhang, 2005). Differentiating between labor market entry and career progression also sheds light on the mechanisms for the effect of institutional prestige on labor market outcomes (Borgen, 2014; Ishida, Spilerman, & Su, 1997). Suppose the advantages of graduates from prestigious institutions continue to exist beyond the initial stages of the career and assuming that productivity among graduates becomes more visible via their work experience. In that case, it will speak against the idea that the prestige of the higher education institution is merely a signal for future productivity to employers. In recent years, scholars of social stratification increasingly used multilevel growth curve analysis – a more holistic approach of modeling occupational attainment over the life course - to examine inter- and intra-generational mobility simultaneously (Barone, Lucchini, & Schizzerotto, 2011; Härkönen & Bihagen, 2011; Härkönen, Manzoni, & Bihagen, 2016; Manzoni, Härkönen, & Mayer, 2014; Passaretta, Barbieri, Wolbers, & Visser, 2018; Schulz & Maas, 2010; Schulz, Maas, & van Leeuwen, 2015).

Besides notable exceptions (e.g., Borgen, 2015; Dale & Krueger, 2002), studies rarely address whether graduate characteristics such as attending different higher education institutions lead to varying labor market benefits for different socioeconomic groups. Whereas the relation between family background and labor market destinations is weaker among graduates than among lower educated groups (Breen & Jonsson, 2008; Hout, 1988; Iannelli & Paterson, 2007; Torche, 2011), social inequalities among graduates are evident even after accounting for institutional prestige, the field of study or performance (Jacob, Klein, & Iannelli, 2015; Triventi, 2013). This suggests that other factors, such as parental resources or social networks, play a role in allocating graduates’ labor market positions. Students from advantaged backgrounds may not only be more likely to enter prestigious universities (Boliver, 2011; Jerrim, Chmielewski, & Parker, 2015), but allocation to elite positions may act as a ‘second filter’ for family background, i.e., students from advantaged backgrounds have more resources to convert their educational credentials into prestigious career paths (Rivera, 2011).

The paper advances the literature in two significant ways. First, following recent advances in modeling careers across the life course, it investigates whether graduates from prestigious and less prestigious universities differ in their career progression across the early and mid-career stages. Second, it explores whether graduating from prestigious universities pays off more or less for graduates from different socioeconomic backgrounds and at which stages of the career. The empirical analysis draws on the 1970 British Cohort Study (BCS70) following the lives of individuals born in England, Scotland, and Wales in a single week of 1970. I model graduates’ career progression from their first significant job until 14 years in the labor market. The BCS70 allows me to adjust for a rich set of covariates, including cognitive and non-cognitive ability measures that are commonly unavailable when accounting for selection into prestigious universities.

In what follows, I will briefly discuss the theoretical considerations of why institutional prestige should matter for labor market outcomes. I further elaborate on why the effect of institutional prestige may vary across graduates from different family backgrounds before presenting data, methods, and empirical results.

Section snippets

Institutional prestige and graduates’ career trajectories

Gerber and Cheung (2008: 301) differentiate between four theoretical explanations on why graduating from prestigious universities leads to higher labor market returns than graduating from non-prestigious universities: human capital theory, social networks, signaling theory, and selection bias.

From a human capital perspective, graduates from prestigious universities acquire advanced skills and knowledge during their studies that increase their labor market productivity and labor market returns.

Returns to institutional prestige by family background

Whether and to what extent institutional prestige is advantageous for initial labor market entry and career progression may depend on graduates’ family background. To get access to advantageous occupational positions attending prestigious universities may be a necessary prerequisite, but in the end, it may not be sufficient to succeed. The positive selection hypothesis argues that students who are most likely to attend prestigious universities will benefit the most from it (Brand & Xie, 2010).

Data and methods

For the empirical analysis, I use the 1970 British Cohort Study (BCS70), which follows the lives of people born in England, Scotland, and Wales in a single week of 1970 (Elliott & Shepherd, 2006). Data were collected at birth, age five, 10, 16, 26, and four-year intervals from 30 onwards. The latest sweep that is publicly available surveyed cohort members when they were aged 46. In this paper, I use the 1970 British Cohort Study Activity Histories dataset (University of London, 2017), including

Results

Table 1 provides an overview of the variables and descriptive statistics for 939 complete cases with 135,962 person-months. In this sample of graduates, SIOPS scores range between 15 (e.g., building construction laborers) and 78 (e.g., university professors and medical doctors), with an average of 55.33 and a standard deviation of 11.35. The average time I observe graduates since their first significant job is almost seven years (SD = 48.26 months). One-third of graduates obtained their degree

Discussion

This paper investigated the association between institutional prestige (Russell Group universities vs. other universities) and graduates’ career progression by parental education. It contributes to the literature by following graduates up to 14 years in the labor market, thereby assessing at what point in the career graduates from prestigious and non-prestigious universities differ in their occupational returns. Considering a dynamic and holistic account of graduates’ career progression

Acknowledgements

The author gratefully acknowledges the participants in the 1970 British Cohort Study (BCS70) for providing their information, the Centre for Longitudinal Studies at the Institute of Education, University of London for collecting and managing the data, the Economic and Social Research Council (ESRC)for funding BCS70, and the UK Data Service for storing the data and making them available. Earlier versions of this research were presented at the Society for Longitudinal and Life course Studies

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