Record Median Salaries For Ross MBAs

Graduating MBAs at the University of Michigan’s Ross School of Business this year scored record median starting salaries of $123,000, up from $120,000 a year earlier. But total median compensation declined to $147,845, from last year’s record $150,606, because fewer students reported signing bonuses and other guaranteed compensation.

Median sign-on bonuses, received by 82.1% of the Class of 2017, totaled $25,000, exactly the same as last year when 91.5% of the graduates got signing bonuses. Median other guaranteed compensation, reported by 21.6%, was $20,000, up $5K from year earlier numbers, but in 2016 51.5% of the class received it. Add all the numbers up, adjusted for the percentage of grads receiving bonuses and other comp and the median total starting pay came to $147,845.

Ross said that 92.9% of its students received job offers at graduation, with the percentage increasing to 97.1% three months later. The overall job offer rate three months after graduation was down slightly from last year’s 98.4%. “The class was really strong and we are happy to see them build on the success of the prior year,” says Heather Byrne, managing director of the career development office at Ross. “We hit an all-time high for salary and bonus this year and an all-time high for students going into the tech industry, 23.6% this year versus 20.4% last year.”

INTERNATIONALS REPORTED A HIGHER RATE OF JOB OFFERS THAN DOMESTIC STUDENTS

Foreign nationals surprisingly had slightly higher rates of job offers across the board than domestic students despite increasing concerns over the availability of H1B visas for MBA grads. At graduation, for example, 90.6% of U.S. citizens and permanent residents had offers versus 98.1% of internationals. Three months after commencement, the job offer rate for foreign nationals remained unchanged at 98.1% but was still below domestic students at 96.6%. Roughly 87% of all the grads used their MBA degrees to do a career switch, changing industries or disciplines from their pre-MBA jobs.

One reason for the success of internationals may well be the increasing role tech firms are playing in hiring more MBAs. More of those companies, especially the larger players such as Amazon and Microsoft, are more willing to deal with the paperwork required to hire international students.”The reality is we and the students dedicated considerable time and resources helping them,” adds Byrne. “Our international students do an amazing job of taking advantage of the resources we have. Still, we all are acknowledging that the conditions for work authorizations are going to be a challenge for everyone.”

Even when it came to compensation, the gap between domestic and internationals was small. Foreign nationals pulled down median base salaries of $121,500, versus $125,000 for U.S. citizens, while median bonuses for internationals, at $25,250, actually exceeded the sign-on bonuses of $25,000 for domestic students. More U.S. grads, however, received signing bonuses, 84.9% compared to 76.1% of the internationals.

The highest reported starting salary in the class was $180,000 to an MBA graduate who took a job in an undisclosed industry and function in the New York metro area. The highest reported sign-on bonus was a whopper: $88,500 to one grad.

‘TECH IS A SEXY INDUSTRY AND THERE ARE A LOT OF EXCITING THINGS GOING ON’

Tech firms were two of the top five major employers at Ross this year. For the fourth straight year, Amazon again led all the largest employers at the school, hiring 38 full-time MBAs and 27 summer interns. McKinsey & Co. was not far behind, employing 28 full-timers and eight interns. Deloitte was next with 14 full-time hires and nine interns. Boston Consulting Group and Microsoft were both tied for fourth and fifth place, hiring a dozen full-time MBAs and 11 and eight interns, respectively.

What’s behind the tech industry’s demand for MBA talent and student interest in that sector of the economy? “It’s a sexy industry, says Byrne.”There are a lot of exciting things happening in the industry. It appeals to this generation of students and most of the roles students get in tech is where they could own something and have an impact. It makes them feel they have the opporutnity to do good things at work.”

The consulting industry again took the largest share of Ross MBAs, hiring 32.7% at median base salaries of $144,500, the highest base pay of any industry at the school. That’s up slightly from last year’s 32.2% level and median salary of $144,000. Consulting and technology alone are now hiring more than half of the school’s class.

MBAS GOING TO FINANCE FELL YET AGAIN TO A LOW OF JUST 11%

Increases in both tech and consulting hiring at Ross offset yet another decline in financial service companies. Tech is now taking more than twice as many MBAs out of Ross as the finance sector. Only 11% of the class accepted jobs in the financial sector this year, down from 13.6% a year earlier, while 8.8% went to work in consumer packaged goods, down from 9.8% last year. Manufacturing picked up a little steam, capturing 6.6% of Ross’ graduating MBAs compared with 5.6% in 2016. The healthcare industry remained steady, attracting 6.9% of this year’s crop of Ross grads, versus 6.8% a year earlier.

The growth in the importance of tech at Ross is also causing more of a shift in where the school’s MBAs end up. “We are seeing a record number of students going to the West Coast after graduation,” adds Byrne. “It’s 32.1% compared to 24.2% last year. A lot of it is that the tech industry is booming and that tends to pull the students to the West Coast and maybe weather. That is really exciting for us. It speaks great volumes to our students, our alumni network and the partnership we have with recruiters.”

Unlike Northwestern University’s Kellogg School of Management, the only business school in the midwest to send more MBA grads to the West Coast than remained in the midwest, Ross still supplied the largest single chunk of its MBAs into jobs in the midwest—but not by much. Some 34.6% of the class stayed in the midwest, compared with the 32.1% who went west, mainly to Seattle (17.6%) and the San Francisco Bay Area (10.4%). About 15.4% accepted jobs in the northeast, while 4.1% went to the southwest, 3.1% to the south, and 3.1% to the mid-atlantic states. Some 7.5% of Ross grads accepted jobs outside the U.S.