Business Schools

Calculating Athletes' Gains

By Julie Gordon and Janie Ho on August 23, 2006

Student athletes are the envy of many on big sports campuses. They sometimes enjoy free tuition and room and board at bigger schools, and assume pseudo-star status with students, fans, and even faculty. But since they sometimes carry a reputation of being poor students, there's always the question of how players' degrees hold up in the real world, and whether being a student athlete enhances future earnings.In a new study published in the Journal of Human Resources, researchers at Binghamton University in New York and Ramapo College of New Jersey affirmed previous studies indicating that, overall, student athletes do earn more in fields such as business, the military, and manual labor. However, they found that less than half of former athletes earn more than non-athletes in some more specific fields.The new study found that, on average, slightly more athletes than non-athletes were in higher income brackets six years after college. "This may be because athletics enhance existing skills during college or because athletes learn skills on the field that they can apply in their careers," says study co-author Daniel Henderson, an assistant professor of economics at Binghamton. In addition, compared with non-athletes, the researchers said, athletes were more likely than non-athletes to attend private institutions, to say they were driven, and to have a goal of being financially well-off.While saying that overall collegiate athletes earned more, Henderson also notes that financial benefits aren't uniform to all sports players. On average, athletes receive a modest return and go into the occupations where they're likely to get jobs, such as teaching high school or coaching sports. "Almost 10% enter teaching, an occupation with an especially low wage for athletes. A good 50% do no better than the college population at large," Henderson says.Colleges often argue that their athletics programs are of lasting value to student athletes and lead to higher earnings after school in order to justify the costs of the programs. For example, the study notes that National Collegiate Athletic Association (NCAA) Division I-A athletic departments lose an average of $600,000 per year on average revenues of $25.1 million, after subtracting institutional support.The new study relied on data from the Cooperative Institutional Research Survey of college freshmen in the 1970-71 academic year. The participants were then surveyed in 1980, six years after their expected college graduation. The follow-up questionnaire asked about individuals' post-college earnings, occupational choices, graduate degrees attained, and athletic participation in college. The recently released study used new analytical methods to glean more detail from the data, which had been used in earlier studies.Hollywood DreamsDo you dream of becoming the next great filmmaker? This year, you might have your chance, as Campus MovieFest—started in 2001 by three Emory University business majors and an Emory College student—travels to about 25 campuses.The organization provides Apple (APPL) laptops, camcorders, and training and gives students a week to create their five-minute movies—all at no charge. About 30,000 students are expected to participate this year, says co-founder David Roemer, a Goizueta Business School alumnus (see BusinessWeek.com, 5/8/06, "Emory's Rich B-School Experience").Though most students participate in the project for fun and the chance to see themselves on the big screen, CMF offers some serious prizes for top teams. This fall, more than $50,000 worth of prizes will be awarded, including Apple computers, plane tickets, Campus MovieFest-engraved iPods, and even cash. CMF also has a partnership with Turner Classic Movies (a division of Time Warner,TWX), creating the possibility of airtime on the channel.When Roemer, along with Emory pals Dan Costa, Vijay Makar, and Ajay Pillarisetti, started the festival on their campus, about 1,500 people participated. "They were all showing up for the red carpet finale. They showed creativity, talent, and school spirit that Emory's maybe not known for," says Roemer. After the guys graduated, they created a company called Ideas United and continued with their project, picking up more interest and sponsorship along the way. Campus MovieFest has in the past partnered with several companies looking to reach the youth market, including Coca-Cola (KO), mtvU, Virgin Mobile, and Delta (DALRQ).Campus MovieFest is starting in the San Francisco Bay Area at the end of August, finishing up in mid-October. The tour will continue to schools in Atlanta, Boston, and Florida during the spring. Regional red carpet finales will showcase top films.Foreign Study Boost ProposedMore business undergraduates may get the chance to study abroad if a Senate bill introduced this summer is passed. The Abraham Lincoln Study Abroad Fellowship Program would create a partnership between the federal government and universities to increase the number of undergraduates taking classes in foreign countries.If all goes according to plan, 1 million college students would study abroad in 10 years. About 191,000 students did so in 2004-05. More student diversity, program offerings, and countries—especially in the developing world—are also part of the proposition."The capacity of the United States to lead in the 21st century, not just in Iraq but all over the world, demands that we school new generations of American citizens who understand the cultural and social realities beyond what they have experienced here at home," Senator Richard Durbin (D-Ill.), a sponsor of the bill, said in a statement. The bipartisan bill is co-sponsored by Sen. Norm Coleman (R-MN).The number of business majors heading off-campus for a semester or two has increased in recent years (see BusinessWeek.com, 5/8/06, "No Passport to Success"). While study abroad is often considered a worthwhile educational experience, it's not necessarily a passport to a better job after graduation, as many employers say that, in the recruiting process, work and internship experience are valued more highly.Good Morning, IthacaCornell University students will groove to their own beat this fall when the school gets a student-run Internet radio station. Slope Radio will begin airing Sept. 4. Though Ithaca, N.Y., where Cornell is located, already has a station that some students are involved in, up until now the school didn't have its own radio station. Slope, started by three undergraduates, is an official student organization. The university gave the club several thousand dollars in funding.Many colleges have radio stations—one Internet database lists more than 800 in the U.S.—and the stations are often the training ground for people who are interested in the business of broadcasting.Senior business major Alex Zahn, one of the Cornell station's founders, says he and friends Yaw Etse and Jeff Bookman saw a void that needed to be filled. The guys are hoping to broadcast 24/7, with about 12 pre-recorded radio shows and music. One of the shows in the works—Pitstop—will explore how songs and bands got to where they are today. Another show will join the lineup from all the way from across the pond. Two study-abroad students who had a "variety show" at the London School of Economics' PuLSE FM will be part of Slope's schedule.So did Zahn's education in business help with this venture? Certainly. "I have a better sense of how this whole thing will work," he says. "It's essentially a small business." Hopefully, it will become bigger as the year moves on.Gordon and Ho are reporters for BusinessWeek.com in New York.