MBA Pay Reaches Record Highs

Specialized master’s degrees are on the rise in graduate management education. Meanwhile, some well-known business schools are shuttering their MBA programs — and others are considering it. Yet even as its fortunes appear on the wane, the MBA still pays off — and new data from the Graduate Management Admission Council show that in 2019 the degree is poised to pay off better than ever.

GMAC released its Business School Hiring Report today (May 28), based on findings from its 2019 Corporate Recruiters Survey, and it’s an eyebrow-raiser, showing that the median annual base starting salary that employers in the United States plan to offer new MBA hires in 2019 is $115,000, more than double the median for new bachelor’s degree hires ($55,000) and the highest ever median recorded in the U.S. when adjusted for inflation. (For more context, check out our analysis of salaries at the top 25 U.S. schools. Year to year, those pay levels never do anything but rise.) By industry among U.S. employers, GMAC found that median MBA starting salaries are highest in the consulting ($135,000) and finance/accounting ($125,000) industries.

Worldwide, most employers plan to increase MBA starting salaries in 2019 (56%), including 63% of Asia-Pacific employers, 56% of U.S. employers, and 49% of European employers. However, median annual base starting salaries vary considerably by world region: European companies plan to offer new MBA hires US$95,000 this year, and the median for Asia-Pacific companies is US$45,000.

“Employers clearly place a high value on acquiring MBA and business master’s graduates,” says Sangeet Chowfla, president and CEO of GMAC, in an announcement accompanying release of the report. “We are seeing a highly active candidate marketplace in terms of geographical shifts in study destinations, but the value that both employers and graduates see in an advanced business degree is a constant.”


GMAC’s hiring report was conducted in partnership with MBA Career Services & Employer Alliance (MBA CSEA) and the European Foundation for Management Development (EFMD). It includes insight, gathered in February and March, into current market and hiring trends among MBA and business master’s graduates from over 1,200 employers in 45 countries. Aside from salary projections, the report found that one major factor affecting business schools will likely continue in 2019: U.S. employers’ reluctance to hire international candidates, whether they have an MBA or another business master’s degree. Forty-eight percent of U.S. employers either plan to or are willing to hire international candidates in 2019, about the same as 2018 (47%) and still down from 55% in 2017. 


There’s a silver lining — maybe. This year’s survey was fielded before the recent H-1B rule change became official on April 1. The rule change stands to benefit international graduates with advanced degrees from U.S. institutions of higher education over graduates with bachelor’s degrees. How much, and how positively, will the rule change impact international graduates? And how much will it change the current calculus of foreign students currently mulling an academic pursuit in the U.S.? Time will tell, Chowfla says.

“There has been a feeling of uncertainty in recent years around the direction of U.S. visa policy, which is impacting international hiring and application trends,” he says. “It will be interesting to see how much positive impact this rule change may have on both the flow of international students to the U.S. and their employment opportunities.”

As U.S. companies continue to pull back, international hiring is on the rise among Asia-Pacific and European companies, GMAC found. Seventy-one percent and 69% of European and Asia-Pacific companies, respectively, either plan to or are willing to hire international candidates in 2019, both up from recent years.

Across world regions, reasons differ for not hiring international talent. U.S. employers are more likely to cite uncertainty about future changes in policy/law as a factor (25%), further emphasizing the potential positive impact around the recent H-1B rule change, while in European or Asia-Pacific companies 15% and 11%, respectively, cite policy/law as a determining factor in hiring.

Our recent research reported on the decline in U.S. companies recruiting international students from MBA and specialty master’s programs based on uncertainty about economic conditions,” says Megan Hendricks, executive director for the MBA CSEA. “While the decline in this year’s GMAC report holds steady with regard to U.S. businesses’ plans to hire foreign talent, we hope the recent H-1B visa rule change will encourage students to study in the U.S. in order to diversify B-school classrooms and talent pools.”


MBA hiring projections may appear strong relative to historic trends, but for the second straight year a smaller proportion of companies overall report plans to hire MBA talent compared with the previous year, GMAC found. In the U.S., 77% plan to hire MBA talent in 2019, down for the second consecutive year — and down considerably from the 9 in 10 employers who planned to hire MBAs from 2015-2017. A slightly smaller proportion of responding U.S. companies report plans to grow and expand this year (66%) compared with last year (69%), declines that GMAC associates with worries associated with talk of trade wars and higher tariffs may be impacting employer plans.

Nearly nine in 10 (87%) companies in Asia-Pacific plan to hire MBAs in 2019 — the highest share of any world region, though off slightly compared with last year (90%). Nearly 7 in 10 European companies plan to hire MBAs in 2019 (69%), up from 2018 projections (64%).

“This year’s GMAC report on MBA and graduate management education hiring trends shows the tremendous opportunities graduates have when they finish their business studies,” says Eric Cornuel, director general and CEO of EFMD, in GMAC’s news release accompanying the hiring report. “The growth of quality business schools around the world has also been met with increased employment opportunities for graduates in emerging markets and regional economies. Now is an exciting time to be pursuing an MBA and business master’s degree.”

See more data from the new GMAC report on Page 2.

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