Which University Majors in Singapore Have the Highest Return On Investment?

A university education is one of the biggest investments that a person can make in his life. In fact, earning a university degree can increase your monthly income by more than 100-200% compared to having just earned a secondary degree. However, the major you study can have a significant impact on this calculus as well. This is because different concentration of studies have different starting salaries and employment rates. To measure which majors are the most "cost-effective," our team at ValueChampion compared the tuitions of NUS's various majors to their respective employment statistics to estimate a measure of return on investment for each concentration.

Table of Contents

Key Findings

Majors with the Highest Return on Tuition

According to our calculation, we found that undergraduate programmes pertaining to computing, engineering, architecture, pharmacy and law tend to have the highest level of return on investment on their tuitions immediately upon graduation. In particular, a bachelor's degree in law stood out as having the 2nd highest median gross monthly wage* and the 5th highest full-time employment rate. Though both architecture & law require additional training after graduation, both programmes yielded good results for their graduates once they started working full-time. Also of note, a bachelor degree in computing and computer engineering took all of the top 3 spots in terms of return on tuition. Bachelor of arts degree and bachelor of business administration degree with honors also had above average ROI on tuition.

Majors with the Lowest Return on Tuition

On the other end of the spectrum, we found that bachelor of arts, science, music, dental and medicine degrees tended to have the lowest ROI on tuition, adjusted for employment rate. In particular, music degree holders made only S$3,250 of gross median income per month, with a part-time employment rate of 86%, despite the fact that they had to pay S$110,000 of annual tuition. On the other hand, medicine, surgery and dental surgery degrees* tended to have low ROIs because of their extremely high tuition of about S$27,400 per year despite the fact that they had 100% full-time employment rate and S$4,000-S$5,000 of median gross monthly salary. However, this figure may under-represent the true economics of a medical degree given the stability of their income stream over the long run.

Effect of Earning a Honors Degree: Hard Work Pays Off

Another interesting discovery in this data set was that earning an honors degree does seem to have a real impact on a person's ability earn, in terms of both median salary as well as employment rate. On average, we found that honors degree increases a person's employment-adjusted salary by 27% compared to a normal degree from the same major. This was particularly true for bachelor of arts degrees as well as bachelor of business administration degrees, whose median wage itself increased by about 20% and employment rate increased by 12% just for getting an honors degree. The impact was the lowest for a bachelor of science degree in nursing.

Parting Thoughts

Of course, one person's long term ROI on their degrees are heavily dependent on the individual's own abilities, efforts, success and luck. However, this measure of the short-term and immediate ROI is especially relevant for students who have taken study loans from a bank to fund their higher education or those who just need to maximise their income relative to their costs as soon as possible. Furthermore, while these measures of return on investment aren't absolute, they do capture what students or recent graduates can expect to make immediately after graduation compared to the cost of their degrees. For instance, computer science majors cost nearly 1/3 of the cost of a medical degree, but can get opportunities that pay well in excess of S$100,000 immediately in the first year of one's career. On the other hand, medical decrees cost 2-3x more than other degrees, but doctors can definitely reach six figure income later in their careers with a much higher level of stability.

Note on Methodology

By comparing the latest gross tuitions of NUS's various majors to their employment statistics compiled by the Ministry of Education, we attempted to identify the best majors with the highest return on investment on their tuitions. To calculate the ROI, we divided each major's median annual gross salary by 1 year of tuition. Then, we multiplied this figure by the full-time permanent employment rate to get to an "adjusted ROI" figure for each concentration of study. Such calculation is meant to reflect the realities of an average student at NUS for each degree.

Admittedly, this methodology is not perfect. For instance, it may be unfair to compare the latest tuition figures to the salary of the latest graduating class. Also, we use the tuition for a Singaporean citizen receiving the MOE grant, though we also saw that rankings changed little even when using the pre-MOE grant tuitions. Not only that, wages can change in the future for different industries, and therefore can alter the long-term ROI of each major. Lastly, certain jobs tend to have a lot more stable stream of income for a long period of time (i.e. doctors), while others with high level income (i.e. finance) may not have the same level of safety. However, we wanted to estimate the most current measure of ROI, and hence decided on the calculation methodology explained above.

Detailed Data

For interested readers, we have compiled the following table displaying the detailed data set that we used to compile this study.

Footnotes

*Gross monthly salary pertains only to full-time permanently employed graduates. It comprises the basic salary, overtime payments, commissions, fixed allowances and other regular cash payments, before deductions of the employee’s CPF contributions and personal income tax. Employer’s CPF contributions, bonuses, stock options, lump sum payments, and payments-in-kind are excluded.

Data on law, medicine and pharmacy graduates are obtained from a follow-up survey on 2015 graduates after they have completed their one-year practical law course/pupillage/housemanship/first-year residency/practical training. Data on architecture graduates are obtained from a follow-up survey on 2013 architecture graduates after they have completed their practical training.

^For music degrees, for whom the vast majority of employment was for part-time, we used the part-time employment rate instead of full-time employment rate.

^^NUS's Bachelor of Environmental Studies is a multidisciplinary programme that allows graduates to specialise in either Environmental Biology within the Faculty of Science, or Environmental Geography within the Faculty of Arts and Social Sciences. Therefore, we divided this group into two groups for bachelor of arts degree and bachelor of social sciences degree.