It’s the money, stupid.
Amid much soul-searching and navel-gazing, a great deal of the research, commentary, and coverage of the decline of full-time, residential MBA programs has been dedicated to U.S. immigration policy in the Age of Trump. And not for nothing: The president’s bluster, his administration’s apparent antipathy toward prospective immigrant populations with even the most sought-after skills, is troubling to a great many people.
But Trump’s chaos means that a major — perhaps the major — cause of the MBA’s struggles has been somewhat overlooked: cost. It is, frankly, damned expensive to get an MBA at a U.S. business school — and increasingly at an elite school, prohibitively so. A Poets&Quants analysis of tuition, room-and-board, fees, and other costs at the leading MBA programs shows that the total price tag has eclipsed $200,000 at a dozen institutions, up from nine schools last year. In 2016, only four schools charged that much for two years of graduate business education. Another four schools are in the $190K range, knocking on the door to the $200K Club.
MBA PROGRAMS HAVE BECOME VERY EXPENSIVE
It doesn’t matter how deep your pockets are. No one can look at these costs without blinking. Leading the way, so to speak, is MIT’s Sloan School of Management, which in 2019 has grown its total cost by more than 18% in the last two cycles, to $237,636. In the last year alone the price tag for an MBA from MIT grew 6.5%. Following MIT are NYU’s Stern School of Business ($233,022), Stanford Graduate School of Business ($231,834), which was the most expensive school each of the last two years, Dartmouth College’s Tuck School of Business ($230,080), and The Wharton School at the University of Pennsylvania ($229,792).
After MIT, four schools saw double-digit increases in cost over the last three years: UCLA’s Anderson School of Management (13.3%, to $220,112), the University of Michigan’s Ross School of Business (11.3%, to $193,720), UC-Berkeley’s Haas School of Business (10.8%, to $203,068), and Dartmouth Tuck, where the cost climbed 10.5%.
THE BIGGEST PIECE OF THE PRICE PIE: TUITION
Harvard Business School and the University of Chicago’s Booth School of Business made news this year when both schools announced they would freeze tuition for the 2019 intake. Stanford GSB seems to have followed their lead; its listed tuition of $73,062 is unchanged from last year. That is doubtless a welcome move where students at each school are concerned, but it doesn’t change the fact that all three still are among the dozen most expensive in terms of tuition, and among the top 10 in highest overall cost.
The highest tuition in the land, however, is not in Cambridge, Chicago, or Palo Alto. It’s in Philadelphia. The Wharton School hiked by 3.1% what was last year’s highest tuition as well, to $81,378 — the only school to eclipse the $80K threshold. Meanwhile Wharton only accounted for a modest (1.4%) increase in living expenses (see below). After Wharton comes Columbia Business School, which increased tuition by 4% to $77,376 (while staying flat in room/board estimate), followed by MIT Sloan ($77,168), Dartmouth Tuck ($75,108), and NYU Stern ($74,184). Looking at only out-of-state tuition (many schools do not distinguish between in- and out-of-state students), 13 schools have tuition rates of $70K or more. That’s up from nine schools last year.
One school merits mention for keeping all its costs and cost estimates flat from 2018 to this year: the University of Texas-Austin McCombs School of Business. From last year to this year, Texas McCombs kept tuition at $54,924 and cost of living estimate at $18,370. Every other school examined by P&Q had some change, however small, in one or the other data point.
ABOUT THOSE LIVING EXPENSES …
B-schools’ calculation of living expenses in their total cost estimates is a source of ongoing debate. To wit: Who thinks it’s possible to live like a monk for two years in New York, Los Angeles, Philadelphia, Chicago, or the Bay Area of California? Or for that matter in Hanover, New Hampshire, Ann Arbor, Michigan, Charlottesville, Virginia, or Austin, Texas? Because in many — really in most — cases, schools’ estimates of annual living expenses are far below realistic.
For example, NYU says its MBA candidates should budget $26,780 for a year in New York City, a town where the average rent for a one-bedroom apartment, according to Rent Jungle, is just shy of $3,000 a month. That’s to say nothing of the cost of food and the occasional item of clothing or night out. Columbia, in the same town, is even worse, budgeting only $21,375. Across the country, Stanford is a bit more realistic about the cost of living in pricey Palo Alto, budgeting a “living allowance” of $32,712 — but consider that, according to Rent Café, the average cost of an 800-square-foot closet anywhere in the vicinity of Stanford’s campus is more than $3,300 per month. And again, there’s that whole eating thing.
Stanford doesn’t have just one number that it applies to all students’ situations. Rather, the school indicates that married students should budget a yearly living allowance of $54,300. Which is great — until you realize that by doing so, your total cost to attend GSB has ballooned to $277,044 over two years. Further down the rankings, Indiana University’s Kelley School of Business has widely disparate cost estimates for in-state versus out-of-state residents. Indiana residents can expect to pay $27,863 in tuition, a little more than half what everyone else pays: $51,451. That’s a big enough difference that it might be worth it to live in Indiana for a while before starting your MBA.
See the next page for a complete chart of the costs at 23 of the top-ranked U.S. B-schools.