Lower pay or higher costs?
Quality of life or abundance of opportunities?
The right industry…or the right firm or role?
MBAs are asking themselves these questions during their job hunt. They aren’t easy choices. A dollar goes further in the Heartland than the Bay Area…but does it net you as much? Are you ready to get stacked up in the Big Apple – or would you rather spread out in Minneapolis or Salt Lake City? Who wouldn’t be attracted to the glitter, sunshine, and opportunities in Silicon Beach? Question is, can you stomach the traffic, smog, and tent cities that come with it?
HIGHER PAY…BUT ONLY RELEVANT IN CERTAIN REGIONS
Location is destiny, as the saying goes. It can amplify your business school and industry networks – and the doors that they can open for you. Their economics dictate the cost of living. Even more, location can impact – to an extent – how much you’re worth. That can come in handy when you have an offer placed in front of you.
Obviously, certain factors impact compensation. Take the schools. Not surprisingly, Stanford GSB tops base pay in the Western Region. Why? 33% of its 2018 grads entered the lucrative tech field, with another 29% landing jobs in private equity, venture capital, and hedge funds. On top of that, 18% of the class chose consulting, which came with $151,400 mean bases. Those numbers are heightened by 68% of the class remaining on the West Coast. In addition, Stanford grads posted the highest bases on the East Coast, which intertwines with a growing tech sector with long-thriving finance and consulting industries.
Of course, these numbers also reflect another issue. Just 7% of the 2018 Class re-located to the Mid-Atlantic, South, Midwest, or Southwest regions after graduation. This share is relatively consistent with past classes: 2017 (11%), 2016 (9%), 2015 (8%), and 2014 (9%). For the glass half empty crowd, these footprints translate to small regional networks to support their career progress. To an optimist, a Stanford grad seeking work in Missouri, for example, might be viewed as a modern-day unicorn who warrants a bigger checks thanks to the prestige, connections, and expertise they’d potentially bring.
A REFLECTION OF POSSIBILITIES
Each year, MBA programs break down base pay by geographic region, reporting it through both their employment reports and U.S. News & World Report. Why does base pay matter? It is certainly an incomplete metric. Base pay doesn’t include first-year bonuses, which can boost pay packages by 25% or more. In addition, bonuses aren’t always governed by the relative consistency of starting bases. At Wharton, for example, the 2018 class averaged a $34,751 starting bonus, a number that included a $250,000 bonus for one lucky grad. In contrast, Emory Goizueta grads notched $30,301 in bonus, capped by a $100,000 sign-on.
Even more, base pay doesn’t factor in the catch-all “Other Guaranteed Compensation” – an often unreported perk which can include stock options, tuition reimbursement, profit-sharing, and 401K matches. In 2018, Harvard Business School grads enjoyed $28,750 in such compensation, for example, nearly double the amount reported by Emory Goizueta grads ($16,275). As always, the number of students reporting impacts pay. Dartmouth Tuck is a case in point. In the South, Tuck grads average $145,083 in base pay, the highest in the region and nearly $7,500 more than Harvard Business School grads. Of course, Tuck’s South average is based on nine graduates – including one with a $215,000 base – in contrast to HBS’ 24 graduates (where the highest base was $157,000). It is Statistics 101: the smaller the sample, the less reliable the results.
Of course, such information also shows that it is possible to snag a $200,000 base in the South. That’s the whole purpose of reviewing these numbers. They are a starting point for knowing how much you are worth and how much employers may potentially be willing to pay, regardless of where you plan to start your MBA career. While you’ll find pay disparities by region, they can be leveled off by the cost of living calculators like this one. In other words, these school-by-school and region-by-region comparisons can guide you in weighing offers – and provide some justification when it comes time to negotiate.
To see how your target schools fare in base pay in particular regions – along with how low, average, and high pay has changed over the past three years – click on the links below.