Stanford Sets A New Record For MBA Compensation: $231.7K

Finance remains the industry of choice for most Stanford MBAs, with more than a third of the Class of 2020 (34%) choosing the sector, up a tick from last year. Tech jobs — which, as Jamie Schein points out, can be put into many different categories in today’s highly digitized work world — rebounded partway from last year, when they dropped to 24% from 33% in 2018. Twenty-eight percent of this year’s class went into tech. Consulting, meanwhile, slipped to 15% from 18%.

Schein says too much was made of the drop-off in tech jobs in 2019.

“The way we talk about tech is, it bounces around a lot, and tech bounces around a lot because this is all student-reported,” she tells P&Q. “This is what students are reporting as tech,” Schein says. “We talked about this is last year’s report: transportation logistics, is that in tech, is it not? It’s a tech-enabled business. If people are going into fintech, is that fin or tech? And students get to self-report. So we look at the bouncing around as really what’s defined in the segment. And last year tech was down, so we consider tech to be sort of at a steady state this year. I think you have to look at the trend over the last several years. It’s still in our top three.”

Not included in the job-seeking pool was another record number for Stanford: the number of MBAs launching their own venture. The GSB, well-known as an entrepreneurship hotbed, saw 18% of the Class of 2020 start their own company, up from 15% last year, and tying the school record from 2013.

“I think one of the things that’s notable in the students who are starting their own ventures is that there’s a rise in the number of ventures that are related to healthcare,” Schein says. “We see those as opportunities for disruption in healthcare plus there’s been a big focus on mental health and well-being during the pandemic.”

SOMEONE IN PE REPORTED A BASE SALARY OF $400K

However tech may bounce around, it is generally lower-paid than finance, and 2020 was no different. Finance jobs led all positions with a median salary of $175,000 and an average of $182,706, led by the as-usual astronomical sums earned by MBAs in private equity ($200,667 average) and venture capital ($197,143). That includes someone in PE who reported a base salary of $400,000, and someone else in VC who reported $300,000. Consulting was next with a median $165,000 and mean $156,222, and tech followed with a median $140K. However, someone in “tech enterprise” reported hauling in a starting salary of $300K.

Tech, interestingly, comprised the full gamut of signing bonuses, reported by 51% of the class. Tech bonuses ranged from $3,000 to $175,000, both the low and high marks on the full class scale. Performance bonuses were gaudiest in PE, however, with a median $177,500 and a high of $400,000.

Not unusually, a salary gap persists between those with and without permanent U.S. work authorization — in other words, between domestic and international MBAs. Stanford reports that U.S. MBAs in the latest class made a median $164,500 this year, while their foreign counterparts made $137,000. However, “When controlled for international location and industry sector, the gap gets smaller,” Schein says. “Also, non-U.S. work-authorized graduates had higher bonuses than U.S. work-authorized graduates” — $30K compared to $25K — “and that helped close the gap.”

One of those international students, Jack Armstrong, faced the same set of hurdles many international students in the U.S. contend with: visa concerns in addition to a job search. A native of the UK, Armstrong “was fortunate” to lock in his job in September 2019, well before the onset of coronavirus, landing a job as chief of staff at Amplity Health, an Altamont Capital Partners portfolio company. Yet even with that concern allayed, he faces ongoing challenges in being a non-citizen.

“I was fortunate to have it locked in early and then really it was about having good conversations with the company I ultimately ended up in, to say, ‘Is that still a role? How are we doing? Does it still make sense for you?'” Armstrong says. “And fortunately for me, the company was doing fine. The biggest thing in March was the change of tone toward visas. That was really my uncertainty versus anything else.

“I still don’t feel secure in my ability to get a visa,” he adds. “It got harder after I joined in August, as Trump changed the laws. Luckily, my company has an immigration lawyer we’re working with, and it looks like some recent rulings in the Bay Area plus the change of administration should roll back some of those requirements. But one of the deciding factors that I liked about this organization is that they have a UK office, providing me with a safety net that I feel very grateful for.

“Finding a job that will sponsor you for a visa is important. Finding that job during a pandemic — I feel very lucky.”