MBA Pay: Harvard vs. Duke & Texas

moneytreeHow important is a business school brand in determining how much money you’ll make when you graduate with your MBA degree?

The answer, given the clamor among MBA applicants to get into the highest ranked school possible, may surprise you.

Consider three highly prominent schools that have released preliminary employment stats for full-time MBA grads of the Class of 2013: Harvard Business School, Duke University’s Fuqua School, and the University of Texas’ McCombs School of Business. Comparing the preliminary stats allows a glimpse of pay at what is generally regarded as the best business school in the world against two highly ranked and prestigious universities: one private and one public.


If you guessed that HBS grads left school with the highest starting salaries, you would be right. But the surprise is that they didn’t earn that much more than MBAs from either Duke or UT. The median starting salary for a Harvard MBA this year was $120,000, $10,000 more than Fuqua’s $110,000 median and $15,000 more than McCombs’ $105,000.

When it came to signing bonuses this year, each school reported exactly the same median number: $25,000. There was greater variation in guaranteed other compensation with Harvard MBAs pulling down a median $35,000 versus $20,000 at Fuqua and $10,000 at McCombs.

But the overall differences in pay may have as much to do with industry choice than with brand. Even geography doesn’t explain the differences. Harvard MBAs who went to work in the southwest, for example, reported median base salaries of $$130,850, significantly more than the UT average of $111,512 or the Duke median of $102,000. McCombs’ MBAs who landed jobs in the northeast reported average salaries of $105,583. That compares with the $110,000 median for Duke MBAs and the $120,000 median for HBS grads in the northeast.

The most revealing data can be seen in the industry breakdowns. The median for consulting, the industry that hires the most MBAs, at both Harvard and Duke is exactly the same: $135,000. McCombs didn’t report median numbers for industry specific compensation but its average of $128,698 for consulting is close enough to make little difference. What the data essentially shows is what most corporate recruiters already know: MBA pay is generally the same no matter where they recruit.


In some cases, these numbers diverge–but in surprising ways. The 10% of the class at Fuqua that accepted jobs in the technology industry reported median starting salaries of $117,000, a couple thousand dollars more than the 18% of the class at Harvard that went into tech. HBS grads reported median base salary of $115,000.

The average industry numbers for investment management at McCombs, $120,250, are better than Harvard’s median of $115,000 for the same industry. McCombs boasts higher averages for MBAs going into the consumer products industry as well.


On the other hand, Harvard kills it in private equity and venture capital. The school’s median base this year was $150,000. The UT average in the same industry was nearly $48,000 less at $111,000. At Duke, the median was $112,500, a difference of $37,500 in Harvard’s favor (see table). Even more telling is that 9% of Harvard’s graduating class this year went into PE or venture capital, versus only 1% at Duke and 3% at UT. Those differences alone could well account for the disparities in overall starting salaries reported by each school.

Harvard grads also seem to be doing a lot better in healthcare and manufacturing. In healthcare, for example, HBS grads nailed down median base salaries of $120,000, $10,000 more than those at Duke and nearly $18,000 more than the UT average. In manufacturing, Harvard MBAs reported median base pay of $120,000 as well, versus $102,600 for Duke grads and an average $93,750 for UT grads.

Still, the big surprise is that the differences–with few exceptions–aren’t all that great. And that especially is true when you take into account the sticker price for the education. The tuition bill for a UT student over the two-year MBA program is nearly $29,000 less than Harvard’s $126,400. The two-year tuition at Duke comes to $110,600, nearly $16,000 less than HBS.

(See following page for a breakdown of the key salaries at all three schools)