So, you are considering applying to an MBA program this year but wonder whether investing the time, money, energy, and everything else required for the endeavor is truly worthwhile. The easy answer is yes—go for it. Chances are high that after you earn your MBA, you will make more money, possess a better knowledge base that will propel your career forward, and have connections that will position you for success. But an MBA is not for everyone, and it is definitely not for anyone who is unsure about what is driving them to pursue the degree. Before you head down this road, think about why you want an MBA and where you want it to take you.
Salary and Career Outlook for MBAs
If you are thinking about pursuing an MBA, chances are you are weighing the degree’s return on investment (ROI). You are certainly not alone. An MBA will propel your salary higher than a mere bachelor’s degree. A 2021 study conducted by data analytics company PayScale for Poets&Quants found that graduates of the leading 50 U.S. business schools are expected to earn a median total of $5.7 million in cash compensation after 35 years of post-graduate work just in terms of salary (i.e., excluding bonuses, stock options, health care benefits, and other forms of remuneration), “a premium of $2.3 million over those with just an undergraduate degree.” Alumni of the MBA programs at Harvard, Stanford, Berkeley, Dartmouth, and the University of Virginia vault to the top with more than $8 million in earnings over that 35-year period, according to the study. Those kinds of numbers certainly make an MBA degree sound worthwhile!
Programs That Offer the Best ROI
Prospective applicants considering the possible ROI of an MBA can calculate what they might expect via simple back-of-the-envelope math: adding the average salary of a school’s graduating students to the average signing bonus, and then dividing that total by the average student debt of those who borrowed. In 2024, to compare the ROIs of MBA programs, U.S. News & World Report ranked 32 business schools whose full-time MBA program graduates average six-figure salaries within three months of graduation—and the findings might surprise you. What are generally considered the most competitive U.S. MBA programs did not even crack the top 25! The number-one ranked program was Baruch College’s Zicklin School of Business in New York City, which is 53rd in the U.S. News overall business school ranking. Its students reported an average salary and signing bonus total of $133,655 within three months of graduating, while the average debt was just $16,544. That equates to a salary-to-debt ratio of 8.1-to-1.
Nevertheless, the employment market for MBAs is not without concern right now, and many worry that the U.S. economy could be heading toward a recession. A study by Poets&Quants of 30 leading U.S. business schools found that only two of the programs reported higher placement rates in 2024 than they did in 2020, in the midst of the pandemic: Washington University’s Olin Business School and Indiana University’s Kelley School of Business. Numbers at the Vanderbilt Owen Graduate School of Management and the University of Virginia’s Darden School were flat. The remaining 26 programs all recorded lower MBA employment placement. At the same time, schools are reporting a decline in MBA compensation. Poets&Quants revealed that only two of the business schools in its study reported average starting base salary increases from 2023 to 2024: MIT Sloan (up $1,275 to $169,370) and Emory Goizueta (up $1,551 to $153,868). The 21 other schools that reported average starting salaries were down. Rochester Simon saw the biggest drop in average salary (down $11,352 to $129,093), while the Yale School of Management saw the biggest drop in median salary (down $15,000 to $160,000).
Other Benefits of an MBA
In addition to boosting your income, an MBA can fuel your career trajectory. Learning to work well in teams, solve complex problems, and strategically make decisions can translate into being an effective contributor—and hopefully, leader—in the workplace. Not only do you build technical skills over the course of your MBA studies, but you also gain soft skills in management and leadership that can help you navigate complicated challenges when dealing with people and projects. The professional development your MBA experience will provide will last throughout your entire career, well beyond your initial post-graduate role.
Building Your Network via Business School
An expanded network is another benefit of attending business school. You will meet fellow students in your classes, of course, but also when doing group work, volunteering, participating in extracurriculars, going on study trips, and socializing. Given how global most MBA programs are these days—many have classes that are nearly 50% international—students are able to connect with classmates who come from all over the world, thereby expanding their global mind-set. In addition, business schools have vast alumni networks, and students can call on these connections as needed throughout their career. Long after graduation, you might be invited to interview at a company, and a quick search of your school’s alumni database will give you the names of fellow graduates who work there. Bingo—you have contacts who can help you!
mbaMission Career Coach Elissa Harris offers her tips on overcoming networking nerves in this article.
Factoring Career Goals into Your MBA Plans
While salary and job outlook, ROI, skill development, and network building certainly play into why someone would want an MBA, they are not the only factors one should consider. Before you apply to business school, really examine your career goals. The last thing you want to do is apply to a program that will not propel you to where you want to be professionally after you graduate. Although MBAs can generally be found working in every field, you should dedicate time to researching whether the degree will provide what you need to be able to achieve your long-term career aspirations. For example, does the MBA program you are considering have courses that relate to your area of interest? What is the typical level of job placement in the industry you want to target? An MBA will not be worth the investment if you end up scrambling for work at graduation.
For information on setting reasonable career goals, read this article by mbaMission Career Coach Elissa Harris.
The Financial Commitment of an MBA
Another important factor you need to weigh is your finances. You need to be realistic about your risk tolerance. Are you in a position to take two years off of work to complete a full-time program? If not, maybe a part-time or executive MBA program would serve you better by allowing you to continue working. On the personal front, asking yourself whether now is the right time to go back to school is crucial. This question extends beyond just the financial aspect of pursuing the degree; ask yourself whether you have the time to dedicate to it as well.
As you are considering whether an MBA would be worth the time and other resources that earning it requires, do not be blinded by the potential gain in compensation. Think about what else the degree could change for you in the long term. If you feel that it would advance your career in terms of greater leadership opportunities, then you very well might be making the right choice about applying to business school.
If you have questions about MBA application strategies or about which schools you would be competitive at, sign up for a free 30-minute consultation with an mbaMission consultant.
