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Why An MBA Beats An Undergrad Degree

Why an MBA Beats an Undergrad Business Degree

The MBA has become the most popular postgraduate degree in the US, according to figures from the US Department of Education. And there’s good reason behind that.

Farran Powell, a reporter at US News, recently disclosed a few advantages that the MBA offers for prospective students – especially when compared to an undergraduate business degree.

Increased Earning Potential

Experts say MBAs can expect to earn as much as a 20% increase in entry salary when compared to an undergraduate business graduate.

But RT Good, dean of the College of Business and Management at Lynn University, tells US News that several factors could make that number even higher.

According to a 2018 report by the National Association of College and Employers, MBA grads make upwards of 38% more than their undergraduate business graduate counterparts.

“This compensation rate increase compounds with each additional year, and studies indicate that an MBA degree can accelerate the rate of increases so that within five years, graduates might expect an 80 percent increase over their post-MBA entry compensation rate,” Good tells US News.

Higher earning potential also hinges on your MBA program. Harvard MBAs earn an annual median of $204,000 by “mid-career,” which is defined as “10 or more years of experience.”

Higher Career Prospects

Many companies also seek out MBAs for leadership positions that are likely unavailable to undergrad business grads. Last year, we reported that Amazon hires over 1,000 MBAs a year.

“It’s one of the smartest companies on the planet, and it has become a training ground for MBAs,” says Shashi Matta, faculty director of the MBA program at Ohio State University’s Fisher College of Business. “They are absolutely hungry for talent and growth.”

Michell Kubot, who earned an MBA at University of South Dakota’s School of Business, tells US News she pursued an MBA to enhance her career prospects.

“A bachelor’s in business prepares you to do a job – like a marketing coordinator. An MBA prepares you to manage the people, processes and strategies that do the job – like a marketing director,” Kubot tells US News.

Network Opportunities

While the information you’ll learn in an MBA is crucial, the people you learn with is even more crucial.

“That’s the network they’ll have the rest of their career,” Stephen Rakas, executive director of the career opportunities center at Tepper School of Business at Carnegie Mellon University, tells US News.

Rachel Soper Sanders, a 2017 MBA graduate of Harvard Business School, tells US News that her experience at Harvard gave her invaluable connections.

“I would say more than earning potential, having an MBA greatly expands opportunities largely due to the network that you have gained as a result. Oftentimes, more opportunities mean higher earning potential in the future,” she tells US News.

Sources: US News, National Association of Colleges and Employers, Poets & Quants, Poets & Quants, Poets & Quants