Many people in the business field hope to boost their careers and their earning potential by going back to school for a Master's in Business Administration (MBA).
For the most part, MBA graduates will increase not only their knowledge but their capacity for earning more throughout their career, depending on their experience, the reputation of their graduating institution or alma mater, the area in which the graduate wishes to live and work and the industry in which the graduate works.
Averages
According to the Graduate Management Admission Council (GMAC), the average starting salary for 2006 MBA graduates was $80,809. Graduates of the MBA program at Fisher College of Business reported salaries ranging from $48k to $160k, with the median falling at $89k.
The GMAC says salaries have been steadily rising at 21 percent each year for most of the last decade. The GMAC says the average MBA graduate can expect an increased earning potential of up to 50 percent as soon as the degree is earned.
Industry Matters
Some industries pay newly minted MBA graduates more than others. For example, salary plus benefits for graduates entering the field of health care was $30,000 more than those graduates working for nonprofits or the government, according to the GMAC.
In 2006, average salaries were over $100k for graduates in consulting, energy, finance and health care; those taking lower salaries worked in high-tech industries, manufacturing, government and products and services.
Perks
Along with annual salary packages, MBA graduates often receive perks from new employers, including health benefits, stock options, "tuition reimbursements, car allowances and relocation costs," according to the GMAC.
In addition, many companies offer yearly or signing bonuses. At Fisher College of Business at the Ohio State University, 50 percent of the class reported receiving a bonus upon signing an employment contract; others offer bonuses based on individual and company performance. Perks and benefits are a major consideration of many MBA graduates. Depending on the industry, they can radically change an offer from poor to rich.
Cost of Living
According to Fisher College, MBA graduates who wish to land a higher salary need to look in specific areas of the world: in Europe and Asia as well as in the northeastern and mid-Atlantic United States, where average starting salaries begin around $80k. The southwestern states are also a hotbed for high-salary jobs, with salaries beginning around $93 for Fisher graduates.
MBA graduates do not find as much of a salary boost in the midwest or northwestern states or in South America or Africa.
University
Like many industries, a degree from a well-regarded, top MBA school may increase a graduate's chances of landing a high starting salary. According to "U.S. News and World Report" 2008 business school rankings, MBA graduates from Columbia University land a median total pay package of $144,000; all of the top schools, such as Harvard, Stanford, Duke, Cornell and Dartmouth report six-figure starting salaries. Regional schools or state universities without an Ivy League name behind them often fall behind, earning their graduates a more normal median of $50 to $100k.
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