Relish, a career-finding platform specific for MBAs, aggregated more than 11,000 self-reported salary data points from MBA students and graduates before entering business school and after business school between 2009 and 2018. It found eye-popping salary differences. According to the data, MBAs overall saw a salary jump of $36,742 — a nearly 50% increase. On average, users of the site reported a pre-MBA salary of $79,505 and an average post-MBA salary of $116,248.
“Before this analysis, we were confident that we would see a significant increase in salary, but the magnitude of that increase was surprising,” says Zach Mayo, co-founder and director of product development at Relish. “In addition, the fact that consulting led the pack by a large margin was also a surprise, particularly with such a large sample size across a range of schools — a more than 50% increase on one of the highest pre-MBA salaries we analyzed.”
COMMANDING A PREMIUM IN EVEN LOW-PAY INDUSTRIES
On average, MBAs reported earning an increase of $46,414 in consulting — from about $86,188 pre-MBA to $132,601 post-MBA. Consulting was also the second-most lucrative post-MBA career option behind private equity, where post-MBA users reported an average salary of $136,132. MBAs entering the food, beverage, and tobacco industry reported the second-highest salary jump at $41,249.
“This was another unexpected result, but is at least partially explained by this industry’s pre-MBA salary being one of the lowest we saw across all industries, while its post-MBA salary is only slightly below average,” Mayo says of food, beverage, and tobacco, which has an average pre-MBA salary of $63,070. The only industries with lower average reported salaries were education ($59,682), publishing ($58,333), and nonprofit ($56,424).
Post-MBA, food, beverage, and tobacco climbs to $104,319, which “would suggest that the compensation in this industry is generally low, but an MBA candidate still commands a premium among employers in this space,” Mayo adds.
Following consulting and food, beverage, and tobacco is investment management, with a salary jump of $38,844. Rounding out the top five for salary increases are private equity ($37,739) and technology ($36,763).
At the other end, MBAs in the law industry saw the smallest gains from before and after business school. On average, MBAs reporting salary data in the law industry saw an increase of $8,138. The next lowest industry was government, with an increase of $12,985; rounding out the bottom five were education ($14,826), hospitality ($14,982), and accounting ($20,994). Mayo says the data come from MBAs graduating across all schools on their platform, but the highest concentration come from graduates of Chicago Booth, Harvard Business School, MIT Sloan, Stanford’s Graduate School of Business, and Northwestern Kellogg.
In terms of job function, consulting also leads in the popular MBA job categorical areas with an increase of $45,327. Technically, architecture, physicians, research, and customer support all have higher average salary increases; but Mayo says that is largely because of the small sample size of data in those functional areas. Following consulting is human resources, where MBAs reported an average increase of $43,207; investment management had the next highest salary jump at $42,235, and rounding out the top five were marketing ($41,369) and private equity ($39,495).
“The data suggest that many traditional MBA target functions — consulting, business development, marketing, investment management — are attractive for good reason,” Mayo says. “Candidates moving into these roles realize more value from their degrees than most of the nontraditional functions, like IT, administrative roles, and engineering. But candidates would also do well to look at some of the less popular functions that still saw significant increases, like Human Resources or Research.”
Regardless of industry or function, the MBA continues to be a force in the marketplace.
“The biggest upshot of this data for us was that an MBA remains a fantastic career investment across nearly all industries and functions,” Mayo says. “For career-switchers, this data can help inform which new industries or functions to target — and which to avoid — but in general this data should be encouraging for anyone considering an MBA.”
SEE THE NEXT TWO PAGES FOR AVERAGE SALARY INCREASES FOR ALL INDUSTRIES AND FUNCTIONS.