Obtaining a Master of Business Administration (MBA) degree is a significant accomplishment, offering many benefits to young and mid-career professionals for career growth. The acquired knowledge and training can position the graduate to introduce and implement sound business practices into their career. For many, it’s safe to say that the motivation for pursuing a postgraduate education boils down to the potential of increasing wages, in light of the costs. Beyond opening up career advancement opportunities, an MBA salary is also one of the most coveted benefits of getting the degree. For many prospective students, perhaps the greatest concern is whether earning this prestigious degree is cost-effective.
The Average Salary
According to 2019 data from U.S. News & World Report and MBA industry publication Poets & Quants, the total average MBA salary for U.S. graduates rose 5.8% from $127,603 to $134,991.
The average MBA salary in 2019 for U.S. graduates, according to data from U.S. News & World Report and Poets & Quants.
Still, these numbers must be taken with a grain of salt, since MBA salaries vary based on each individual, specific career path, and even the school where they got their degree--for example, the average Northwestern University Kellogg School of Management graduate made $141,417 in 2019, which jumped 6.9% from the previous year.
According to PayScale's survey of tens of thousands of MBA graduates, the average salary of MBA graduates is estimated much lower at $88,137, with jobs ranging from senior financial analyst to project manager, and even chief financial officer (CFO). Of MBA graduates, approximately 1.5% of participants had less than one year of work experience, whereas about a third were experienced, and 26% reported that they were mid-career graduates. Based on these results, work experience contributes significantly to an MBA’s salary.
Gender is another variable that can skew an average salary. Men on average earned between $56K and $165K, while women earned between $48K and $137K. When it comes to comparing the average MBA salary between genders, there is still a lot of progress to be made in terms of the gender wage gap.
Salary Variations Per Concentration
Still, the average MBA salary varies according to concentration. According to 2018 data, some graduates made close to twice as much as others based on the field entered. For example, MBAs specializing in strategy topped the list, having a median early-career salary of $94,800 per year--which was $13,900 better than any field of study. By mid-career, strategists were making a median of $150,000 annually. From there, real estate was a hot area with early career pay of $80,900, followed by technology management starting at a $78,200 median early career pay.
Depending on the concentration, however, some also aged better over time. Innovation management, although a concentration that started at a lower early career pay of $62,600, had doubled all the way to $134,000 by mid-career. The same was true of entrepreneurs and the average MBA salary of those who had concentrations in marketing and finance.
What Is the Average Salary For An MBA Graduate?
The Bottom Line
Experience and job types are the biggest influencers on compensation. As an employee invests time on a specific career path, it is reasonable to expect progressive increases in salary. Gender and location also play a role in determining the level of pay, although not to the same degree as the two preceding variables. With numerous factors to consider, the question of average salary is based on individual circumstances, usually involving a combination of factors. No education is a waste. With time and effort, obtaining an MBA can provide access to certain career opportunities. It can take the graduate as far as his or her ambition will allow.