Last Updated: July 29, 2021
Job Options and Salaries for MBA Graduates
Candidates who are planning to pursue their higher education with an MBA must most often choose this course for the career prospects and promotions the degree can offer them. Having a well-thought-out career plan before enrolling in the course would be the best start for candidates. Fixing a career path will allow candidates to know the budget they can keep for educational expenditure and let them specialize in the field to help advance them toward their careers.
Candidates will also be able to choose between Professional MBA, full-time MBA, part-time MBA, Executive MBA, etc. based on their immediate career goals. Estimating based on potential salaries by calculating the average salaries in the field the candidate wants to work in is also one of the ways in which candidates can choose their target school. Out of most graduate programs under the field of management and commerce, MBA offers candidates with the best career options.
Average Salary Increase after MBA
Although the main reason for candidates to go back to academics while pursuing a stable corporate job varies greatly, most of the time it is to advance their career prospects either in new work environments or to gain promotions. Earning an MBA degree provides candidates with better job titles and offers them the opportunity to switch to leadership roles.
There are a lot of factors that impact post-MBA salaries, such as the university from which the candidate got the degree, their role at the company they work in, previous work experience, the industry they work in, etc. But on average, the post-MBA salaries that candidates got were significantly higher than their pre-MBA salaries. Forbes conducted a comprehensive research study on accredited business schools ranked in the top 50 based on the pre-and post-MBA salary comparisons and found the following results:
- The starting pay post-MBA increased at a 50% rate when compared to pre-MBA salaries if the candidate did a full-time MBA.
- The increase rate in salary for part-time MBAs is 41%.
- By the end of five years, post-MBA pay increased 80% compared to post-MBA starting pay for full-time students.
- For graduates of part-time MBA programs, this pay has increased by 56% when compared to their starting pay.
Average Salaries by Industry
The salaries that recent MBA graduates earn vary widely depending on the industry. MBA students who go into consulting tend to earn the most, whereas their classmates who go into the nonprofit sector earn significantly less.
For full-time MBA graduates from the academic year of 2020, the average salary for consulting was $152,470 and for nonprofits, $80,520 according to the U.S. News & World Report. For the class of 2016, the highest paying industries were consulting, financial services, and technology for full-time MBA program graduates. Also, graduates who earned the highest salaries attended a top-ranked university. Job opportunities from top consulting companies are competitive, and some companies will ask for student GMAT test scores as part of the job application requirements.
Salary Breakdown by Industry
Class of 2020 graduates of the full-time MBA program
|Healthcare|| $118,000 |
|Consumer Packed Goods||$107,000 |
|Real Estate||$108,000 |
Average Salaries According to Specialization
For candidates who do an MBA, the field of occupation varies according to the specialization they choose. While most b-schools have their specializations clubbed together under different courses, the top schools will always offer different specializations the candidate can concentrate on. Candidates often choose the institution they want to study is based on the specializations they offer.
The most common specializations offered by schools are marketing, human resources, statistics, economics, general management, corporate strategy, international management, finance, etc. Each of these specializations pertains to a particular industry in the job market where the candidate will be able to find jobs. Candidates who choose to take up an MBA without a specialization will be able to find similar jobs though the probability of them receiving similar jobs will be comparatively small.
The average salaries of candidates vary according to the specialization they have chosen during their MBA. Having a specialization makes the candidate eligible to work in particular fields where their market value will substantially increase due to their additional knowledge in the field. Out of the different specializations, finance, strategy, and human resource are the fields that offer the highest paying career options. According to a report received by Poets & Quants, candidates who specialized in strategy during the 2017 academic year got an initial salary of around $95,000 which increases substantially by the time they reach their mid-career.
Average Salaries According to Program
Business schools offer MBAs under different structures to cater to candidates from different backgrounds. The different kinds of MBAs offered by schools are part-time MBA, full-time MBA, executive MBA, professional MBA, etc. each of which will play different functions in the job market and will be a deciding factor for the salary specifications of the candidate.
Candidates who complete a full-time MBA often get better-paying jobs than part-time MBA candidates. There is also an evident disparity between the initial salaries of candidates who did an MBA on a full-time basis and a part-time basis.
Average Salaries According to Ranking
The ranking of the university the candidate applies to also plays an important role in the salaries the candidates receive. The study from BusinessWeek on MBA salaries found that the median base salary for MBA graduates is $105,000. However, this varies significantly by the school.
For example, the average post-MBA starting salary of Harvard Business School graduates is $172,000 while graduates of second-tier schools, such as Arizona State or Illinois-Urbana Champaign, earn an average starting salary of $72,000. The places where the compensation is the least only receive an average salary of $52,000 according to the USnews.
While it is important to look at the cost of expenditure and the monetary returns of the investment made pre and post-MBA, it is also important that candidates choose a specialization of their interest and a school that has a good ranking. This is because ultimately, factors like the ranking of the school, kind of program, specialization, etc. will all play an important role in the job market. Candidates will often be judged not just for the GPA
and skills they have earned during their degree but the space from where they received the degree will also matter.
Doing the necessary research and looking at the statistics of different schools along with their job placement opportunities can be a good start for candidates who wish to apply to certain institutions. This will help candidates set realistic expectations.