MBA Salary: What Can You Expect?

May 6, 2012 by Amanda Owens
What Can You Expect From an MBA Salary?

Last updated:2015

MBA Salary
The MBA remains to be the most sought after post-graduate prospects for many students, with high salary expectations. Many incoming MBA students have almost delusional expectations about the salaries they will earn after finishing their MBA. However statistics tend to tell a different story.  Let’s look at the actual reality.


What Is the Average MBA Salary Range?

The average MBA salary for the United States is about $113,000 (2013). However, this doesn’t give the complete picture. The mean salary is bloated by exceptionally high figures of a few individuals, as the highest salary an MBA graduate can earn varies from as high as $1,088,638 to as low as $12,000 for some graduates. The median MBA salary which a graduate can expect to earn with an experience of 4 years or less is $55,779, while those with 5-9 years can expect to earn around $71,920.



How Do MBA Salaries Vary and Why?

MBA salaries depend on a large number of factors such as the region in which the college is located, the ranking of the university, the industry of the job and the level of experience of the graduate. Top MBA schools such as Harvard and Stanford the average salary is $124,085 whereas those placed on the lower rung of the ranking table the average salary can be considerably low.
Many MBA graduates choose their MBA schools depending on the region they want to end up working in. Hence the regional dependence of MBA salaries is very important. Regions such as USA and Western Europe have historically had higher compensations which the average compensation more than six figures while it is lowest in Africa and South-America with Asia-Pacific showing an increasing trend in the recent years.

MBA salaries vary greatly with industry in which the graduate accepts a job offer in with the Financial Services consistently doing better than other industries. Even top business schools show a large variation in job offers across industries, with in industries such as manufacturing even graduates from the renowned Columbia Business School earning as low as $15,000. An MBA graduate of San Jose with about 15 years of experience in the mining industry earns about $38,500 while a Tuck graduate in finance at about the same point in his career earns as high as $295,000.

What Do MBA Salary Statistics Actually Show?

MBA salary statistics clearly show that while going by average figures we can expect every MBA graduate to be earning high salaries the real picture is quite different. A lot depends on the choice of business school and the industry in which a graduate accepts a job in. Factors such as previous job experience and location of job also play a major role. Therefore, it is very important to move beyond the MBA hype and do actual research before investing into an MBA degree as the return on investment may vary greatly. To expect an MBA degree to be a ticket to the corner office or to be a get-rich-quick scheme is equivalent to dreaming.
While this is true, MBA is the top qualification for return on investment. Apart from this, it also gives the option of switching careers which may be a very important career goal for many.


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