The cost of an MBA degree from a Top 20 business school in the U.S. climbed 5.7% this year, outpacing both inflation and the rise in starting salaries for MBAs from many of those prestige schools, according to a new analysis by Poets&Quants.
The sticker price for a Harvard MBA is now $121,220, not including room and board, or two years worth of lost income because of the need to quit a job. Harvard hiked its tuition and fees by 7.8% this year. When you add the estimated suggeted costs by Harvard for room and board, the total now comes to $168,099 for a single MBA student or $195,600 for a married student.
Some of these costs, of course, are being offset by scholarship grants made by schools that effectively discount the sticker price of an MBA. At HBS, for example, nearly 50% of the class receives an average of approximately $29,000 per year in need-based fellowships. Still, the cost of an MBA degree has been increasing each year, outpacing inflation for quite some time.
The largest percentage increases this year were pushed through at the Unversity of North Carolina’s Kenan-Flagler Business School, which hiked its total tuition and fees for non-residents by 10.9% to $103,365, and the University of Chicago’s Booth School of Business, which upped its tuition and fees by 9.3% to $109,272. Those increases were more than double the rise in the Consumer Price Index which jumped 3.6% between July 2010 and July 2011.
The price of an MBA degree–both this year and last–are taken from business school reported numbers to Bloomberg BusinessWeek. In some cases, including Harvard, schools included medical insurance, health fees, as well as books and case study materials. However, several schools reported their numbers without those required fees. If those additional fees were added to the total cost of an MBA, the cost of the degree at Columbia Business School would rise to $123,170, from the $113,180 reported total to BusinessWeek. The cost of the degree from Wharton would rise to $122,512, from $114,488. The two-year estimates also assume that costs will remain stable from an MBA student’s first year to the second (which never happens). The upshot: in most instances, the numbers in the table below are conservative estimates of the actual costs of the degree.
Even so, increases in MBA tuition and fees outstripped increases in median starting salaries for the Class of 2013 at 13 of the top 20 schools. At Chicago, for example, where the two-year bill for an MBA jumped 9.3% to $109,272 the latest graduating class saw only a 4.9% rise in base salaries to $107,000.
The data shows that increases for a brand name MBA also are outpacing the latest increases at private non-profit undergraduate schools. A recent study by the College Board, for example, showed that private non-profit four-year schools raised their tutition and fees by 4.5%–that’s 1.2 percentage points below the average for the top 20 MBA schools which include several public universities.
Some of the largest increases occurred at public universities for resident applicants (see separate table below). Three of the country’s top eight public B-schools posted double-digit percentage increases in tuition, versus just one of the top 20 for non-residents. At Berkeley’s Haas School, resident tuition and fees soared by 11.4% to $92,832, from $83,360. At North Carolina’s Kenan-Flagler Business School, resident tuition and fees jumped 11.2% to $54,407, from $48,928.
And at UCLA’s Anderson School of Business the two-year bill for a resident in the full-time MBA program rose 10.7% to $90,770, up from $81,966. Only one of the eight public B-schools in the top 25 actually lowered the cost of its MBA for residents: The cost of a Wisconsin MBA is now $25,662, down from $26,903.
2011 Tuition & Fees at Top 20 Business Schools
|School||Total Tuition & Fees||Annual Increase||2010 Tuition & Fees||2011 Salary Increase|
|Columbia Business School||$113,180||5.0%||$107,824||10.0%|
|Yale School of Management||$109,956||6.0%||$103,725||0.0%|
|New York (Stern)||$100,894||6.7%||$94,572||0.0%|
|Carnegie Mellon (Tepper)||$109,600||4.4%||$105,000||5.3%|
Source: School reported data to Bloomberg BusinessWeek
2011 Tuition & Fees for Residents at Top Public B-Schools
|School||Resident Tuition & Fees||Increase||2010 Tuition & Fees|
Source: Business schools reporting to Bloomberg BusinessWeek
Clarification: In an earlier edition of this story, we reported that Harvard Business School had the highest price of any MBA provider. That was because the cost of the degree as reported by Harvard to Bloomberg BusinessWeek included the costs of required medical insurance, books, and case study materials. Other schools did not include those additional costs in the numbers they reported to BusinessWeek. The cost of an MBA at Stanford, for example, would rise to $121,626 from $113,820 when you include health fees, medical insurance and instructional materials. The cost of an MBA at Columbia would rise to $123,170 versus $113,180.