Columbia MBAs See Drop In 2020 Compensation

2019 Columbia Business School grads collectively made the most money of any previous MBA class. CBS photo

It’s a come-down, but only a slight one. After last year’s employment report brought big news for Columbia Business School MBAs — that the school set a new record for total median compensation which, at the time, paced all of the top U.S. schools in median pay — Columbia’s 2020 report bears the mark of a summer of coronavirus, namely a decline in both job offers and acceptances and a small drop in overall compensation.

Nevertheless, the report, released Monday (November 30), includes plenty of good news for CBS and its graduates, beginning with the fact that median base salary held firm and total median compensation only slipped by a few thousand dollars.

After Columbia MBAs’ median compensation leaped an astounding 14.6% between 2018 and 2019, to $177,970, it declined this year amid the challenges of the global pandemic, sliding to $174,313, a 2% drop. This despite a median base salary of $150,000, unchanged from last year, and a median bonus of $30,300, a school record, secured by 67% of graduates. However, other guaranteed compensation — such as stock options — halved, dropping from a record median of $50K in 2019 to $25K this year. Just over 15% of CBS MBAs reported receiving other comp, same as last year.

“This year, Columbia Business School students demonstrated resilience during a time of unprecedented disruption and landed well,” Regina Resnick,
senior managing director of the Columbia Career Management Center, says in the report.

HUGE LEAP IN TECH JOBS FOR CLASS OF 2020

Long-time faculty member Costis Maglaras will succeed Glenn Hubbard as dean of Columbia Business School on July 1

Columbia Business School Dean Costis Maglaras

Columbia reports that 90% of its Class of 2020 MBAs received job offers by three months after graduation, down from 93.9% last year and 94.1% in 2018, and 87% accepted, down from 90.4% in 2019 and 90.1% in 2018. Nineteen students started their own venture, roughly 2.5% of the class of 755, down from 4.5% in 2019.

The biggest industry this year was consulting, reclaiming the top spot after becoming the main industry for CBS grads for the first time in 2018, then slipping behind finance last year. Thirty-four percent of Columbia MBAs went into consulting, and 33.2% into finance, primarily Wall Street, to which CBS has long been one of the country’s primary feeders. As the school continued its transformation into a consulting bastion, McKinsey was again the top employer of Columbia MBAs in 2020, hiring 45, including 28 new hires; Boston Consulting Group and Bain were next with 30 and 24 hires, respectively. (See page 2 for a complete list of top employers of Columbia MBAs over the years.)

Perhaps the biggest story had nothing to do with either industry. Tech-bound MBAs grew to a huge proportion of the graduating class in 2020, increasing to a record 19.8% from 13.8%, a 43.5% jump in one year. Amazon was the fourth-biggest employer of CBS grads this year, hiring 22 of them. The shift is in line with the school’s embrace of tech, including designating its MBA as a Science, Technology, Engineering, and Math (STEM) program in the early part of the year; throughout its new employment report Columbia emphasizes the importance of STEM in its MBA going forward.

“Earning the official STEM designation for MBA and EMBA programs reflects the greater integration of technology and data analytics into the school’s curriculum, which will result in our graduates being even better prepared to solve today’s business challenges,” writes Costis Maglaras, who replaced Glenn Hubbard as Columbia’s dean in July 2019. “Retroactive to May 2019, the designation demonstrates the caliber of knowledge and skills our MBAs have in technology and data science. This designation also affords students from abroad the opportunity to work in the U.S. for up to three years after graduation under an extended Optional Practical Training (OPT) permit, enabling us to draw greater numbers of international students and enhance the already global nature of our programs.

“With our STEM designation, our robust initiatives in the area of diversity, equity, and inclusion, and our ongoing investment in innovation, we are committed to ensuring that our graduates are prepared to lead the type of complex, cross-disciplinary teams working today to solve business challenges and better our society.”

MEDIAN SALARY + BONUS CREEPS UPWARD

Delving a little more deeply into the overall numbers, we see that median salary plus signing bonus this year is $170,513, up a tiny amount from last year’s $170,370; the latter figure was an impressive 13.7% increase over 2018’s $149,890, which itself was up an enviable 5.7% from $141,754 in 2017.

Salary ranges can be instructive; while consulting grads reported the highest median salary at $160,000, finance had the gaudiest numbers, with someone in private equity reporting a base salary of $375,000, and someone else in investment management reporting other guaranteed compensation of $250K. In 2019, the distinction for highest starting salary went to another private equity person who pulled in a cool $375,000, followed by someone who made $263,000 in consumer products and a tech MBA who was paid $260,000 in Internet services/e-commerce.

Whatever they make, most Columbia grads were happy about it in 2020: 94% reported their job satisfaction as a 4 or 5 on scale of 1–5, up from 93% in each of the last two years.

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