What kind of salary growth can you expect in your career after business school? Will you see a high ROI reflected in your MBA salary?
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Let’s imagine that you’re on ABC’s Shark Tank, where entrepreneurs (many of them MBAs!) pitch their business and product ideas to five mega-millionaires in the hopes of gaining the coveted financial and strategic support of a “shark.”
Only you’re not the one pitching your product to the sharks. You’re sitting in one of those sharks’ leather chairs yourself, and the dean from one of the country’s top business schools steps into the tank to convince you to invest in an MBA. What questions would you ask the dean to help you determine whether or not you should go for that degree?
You might wonder, how can going to business school help me? What kind of career and salary growth can my MBA help me attain? Let’s take a look at some of the benefits that might help you, future shark, pull the trigger on investing in your future with an MBA.
Show me the ROI!
MBA salary growth is measurable and significant.
Shark Tank’s Kevin O’Leary, a.k.a. Mr. Wonderful, states in his book, Cold Hard Truth: On Business, Money & Life, “I’m not trying to make friends, I’m trying to make money.” Every shark has to carefully analyze the financial prospects of any investment. We would expect nothing less from you, fledgling pup, in thinking about the ROI of your business school education.
So what kind of salary growth and return on investment can you expect post-MBA? For starters, the median MBA starting salary for the class of 2013 was $90,000, plus approximately $10,000 in bonuses and additional compensation.
The level of increase that poses for you will depend, of course, on your current, pre-MBA salary. But if you’re curious, business schools offer data on the average salary increases their graduates attain. The 2013 Forbes business school ranking, for example, details graduates’ pre-MBA salaries; post-MBA starting salaries; and 5-year, post-MBA salary gains.
For full-time students, post-MBA starting pay increased by 50% upon graduation. For part-time students, the increase was slightly lower, around 41%. If you look at the five-year salary data, the monetary ROI of an MBA degree—especially for a full-timer—is even more compelling. Five years after graduation, full-time MBAs’ median salaries increase by another 80% on top of their post-MBA starting pay, compared to 56% for part-time graduates.
That translates to a pretty hefty salary bump for future MBAs to look forward to. You can find a step-by-step method for calculating your own expected ROI here.
Taking the next step in your career
An MBA is immensely valuable to career growth, across industries.
Obtaining your MBA can give you the freedom to not only move up at your current job, but also to pursue your passion in a different field or industry. This is a major business school selling point. Harvard Business School, for example, shows how several of their alumni pursue various careers post-MBA. You can watch videos of current MBA students’ stories on GMAT’s official website to hear more about real-life MBA opportunities and career motivations.
Expanded career opportunities are a prime factor in an MBA’s return on investment and worth. The Graduate Management Admission Council (GMAC) reports that 77% of 2011 MBA alumni said they could not have gotten their first jobs post-graduation without their degree, and 88% report good to outstanding career outcomes in terms of opportunities for faster career advancement.
Although a higher salary may be part of what makes an MBA worth the investment, money shouldn’t be your only motivation. When you’re considering the reasons to get an MBA, look at your personal career trajectory and examine the specific ways an MBA might be worth it for you in the long term. Will it help you get the job you want, find the career satisfaction you’re looking for, or make a positive impact on the world?
One more word on salary
In the spirit of Shark Tank, let’s revisit the topic of money and worth one more time.
When you’re considering your potential MBA salary increases and career paths, it may interest you to know that salary increases vary depending on whether you decide to stay with your current employer or change jobs post-MBA.
Those who continued with their current employer saw an average percent increase in salary of 39%, whereas those accepting new job offers saw an average increase of 70%. MBA graduates accepting jobs from internships tend to see the highest percent increase in salary—a whopping 84%. This is a big reason why internships are considered a key part of the business school experience and maximizing your MBA investment.
Remember, think like a shark!
Carefully analyze the ROI you can expect from your MBA—both in terms of salary and career growth—to maximize your sizable investment and make your MBA worth it!
Increase your MBA ROI with a great GMAT score. Take our free GMAT practice test today!
The post What ‘Shark Tank’ Can Teach You About Your Post-MBA Salary appeared first on Kaplan GMAT Blog.
