This is the worlds leading source of financial content on the web, ranging from market news to retirement strategies, investing education to insights from advisors.
Forex Forever!

What Is The Average Salary For An MBA Graduate?

Author: Daniel Harris

The decision to return to school after spending time working towards a bachelor's degree is a serious and often costly one. For many, it's safe to say that the motivation for pursuing a postgraduate education boils down to the potential of increasing one's annual income. More specifically, a Master of Business Administration (MBA) degree can open up several career advancement opportunities in addition to providing desired salary increases. But for many prospective students, the real concern is whether earning this prestigious degree is truly worthwhile. (For more, see: The Real Cost Of An MBA.)

Opposite Ends of the Spectrum

In terms of salary, the financial outcome after attaining an MBA can be exhilarating or disappointing depending on a person's intent. According to a 2014 study performed by Poets & Quants, some graduates landed a substantial salary upon obtaining an MBA while others secured positions with starting salaries lower than jobs for graduates with bachelor's degrees.

For example, a few individuals from Stanford and Harvard landed jobs with starting base salaries in the $275,000 to $300,000 range in industries such as investment banking and private equity. On the low end, an MIT graduate landed a $48,000 position in business development and another Harvard graduate secured a $50,000 position at a non-profit organization. Although these figures represent a small number of individuals, they paint a picture of the best-case and worst-case outcomes for MBA graduates – even those from a top-tiered school.

The Average Expectation

PayScale conducted a survey of average salaries from 34,294 MBA holders with degrees in a variety of categories. According to the survey, 1.5 percent of participants had less than one year of work experience and reported a national average salary of $50,453. Those with one to four years of experience, 1.9 percent of respondents, had an average salary of $58,092. Additionally, the 34 percent with 10 to 19 years of experience made an average $98,252 annually. The survey results clearly reveal that work experience contributes significantly to an MBA's salary.

Gender and location are other variables that can skew an average salary. Men claimed to earn between $51,427 and $122,306 while women made between $42,976 and $97,046. California had the highest paid MBA graduates with 12.4 percent of people surveyed earning $99,625. Florida had the lowest paid graduates with 5.5 percent making $73,332.

Yet again, job type is also a significant determinant in calculating average salary. Financial analysts had a national average salary of $60,704 while finance managers earned $93,978. The national average salary for marketing directors and chief financial officers was $118,654 and $128,201, respectively. The list goes on, but you can see how occupation can play a large role in dictating average salary as well.

The Bottom Line

Fortunately, the numbers seem to indicate that an MBA leads to a higher salary. Although there are instances of extremely high and low starting salaries for MBA graduates, they aren't represented in massive quantities. Attending a top-tier school will certainly position one for a six-figure job right out of school—assuming the applicant is pursuing employment in a select industry—but it isn't a prerequisite to earning a handsome wage.

Experience and job type have the most significant impact on compensation. If the time is put in for a certain career path, a higher salary should be on the horizon. Gender and location play a role in determining the level of pay as well, although not to the same extent as the two preceding variables. With numerous variables to consider, the question of average salary truly comes down to an individual's circumstances. No education is a waste, and with enough time and effort, an MBA can take a graduate as far as his or her ambition will allow. (For more, see: MBA Vs. Executive MBA: Which Is Better?)

last five articles

#1251 A Guide to Dividend-Paying Whole Life Insurance

Author: Andrew Jackson

There are many different options when it comes to life insurance policies, ranging from comprehensive whole life to limited term policies. While term policies are usually the cheapest form of life insurance, whole life policies offer a number of benefits that policyholders may want to consider, i... see more

#1036 Mortgage Calculators: How They Work

Author: Michael Jackson

Many prospective homeowners applying for a mortgage tend to have two concerns before they agree to sign: How much interest will I end up paying, and can I afford the monthly payments?Unless you're a robot or mathematical savant, chances are you won't be able to calculate these figures off ... see more

#1291 Taxes in Texas for Small Business: The Basics

Author: Matthew Taylor

Texas is a popular place to conduct business. The state's job growth and unemployment numbers speak for themselves. As of August 2015, the Texas unemployment rate sits at 4.1%, a full percentage point lower than the national rate. Total payrolls and the labor participation rate have also been inc... see more

#609 You Missed The Tax Return Deadline: Now What?

Author: Christopher Harris

Missing the deadline for filing your return is serious but not the end of the world. If you asked for a filing extension, you're not late. But if you didn't request more time to file, don't ignore your failure; take action now to correct the problem.Minimize interest and penaltiesMissing t... see more

#928 Expanding Access to Work-Based Retirement Plans

Author: Andrew Williams

There was once a time when many retired Americans could count on a regular pension payment every month, not to mention a nice check from Social Security. Now, those days look like a very distant memory.Relatively few jobs come with a pension any more, and demographic shifts could mean smal... see more