There are many things that MBA employment reports won’t tell you. But there is also much to learn from reading them — especially with the context offered by previous years’ data.
No period in B-school history has required more context than the last two years, and we don’t need to explain why. The world was upended by the Covid pandemic in March 2020 — and just as economic, political, and cultural news from the ensuing months must be contrasted with the period before everything changed, so too with MBA employment data. A good example is the top business school in the United States, Stanford Graduate School of Business.
As Stanford goes, so do all other B-schools aspire — and they must be encouraged, because for the most part, when it comes to MBA employment outcomes, Stanford has put the pandemic behind it. Within three months of graduation, 91% of Stanford’s MBA Class of 2021 had accepted a job offer, up from the trough of 85% for the Class of 2020 and even better than the 88% for the Class of 2019. The mean and median starting salaries for the Class of 2021 were $161,831 and $158,400, respectively — both increases for the seventh consecutive year.
MEDIAN TOTAL PAY FOR CLASS OF 2021 STANFORD MBAs: MORE THAN $200K
In one measure, Stanford MBAs graduating in 2021 still suffered from the lingering effects of the global pandemic. In total mean pay, Stanford saw its pace-setting total barely rise in 2021, up a mere $112 to $231,849 — a delayed sign of Covid's impact across MBA-heavy industries.
Poets&Quants calculates total pay by totaling mean base salary, sign-on-bonus, and expected performance bonus, with the latter two adjusted to account for the percentage of graduates receiving those elements of pay. A drop in average sign-on bonus was the main culprit in Stanford's flattened average total pay from 2020 to 2021, offsetting the good news of salary increases.
The median total pay picture, however, reinforces an overall sanguine outlook. With a median salary of $158,000, sign-on bonus of $30,000 (reported by 52% of grads), and expected performance bonus of $37,750 (70%), the median total pay of Class of 2021 Stanford MBAs was $200,025, up nearly 3% from 2020 ($194,365), which was up 3.5% from 2019's $187,760.
Clearly, Stanford grads do the best of any top B-school — much higher than Columbia Business School's median $178,380 or Harvard Business School's $189,850, the only other schools that even come close.
GSB GRADS 'WELL-POSITIONED TO MAKE AN IMPACT'
“The Class of 2021 weathered the initial shock of the global pandemic as they pursued their summer internships in 2020, demonstrating grit and resilience,” says Jamie Schein, assistant dean and director of Stanford's Career Management Center. “Those students then graduated into a robust job market where they found opportunities aligned with their values and where they could make an impact. Outcomes for the class are in line with previous years, and show a return to pre-pandemic offer timing with strong salaries.”
Stanford MBAs' industry choices did not undergo any major shifts in 2021, with finance-bound grads once again comprising about a third of the class, tech inching up a point to 29%, and consulting climbing to 18% from 15%. The GSB, well-known as an entrepreneurship hotbed, saw 18% of the Class of 2021 start their own company, same as 2020 and up from 15% in 2019. The 18% once again ties a school record from 2013.
“The pandemic has made the MBA experiences for the classes of 2021 and 2022 very different from what they imagined when they arrived at Stanford. I am thrilled that the rebounding economy has provided them with opportunities in traditional MBA roles as well as in new and disruptive organizations,” says Paul Oyer, senior associate dean for academic affairs. “Our 2021 graduates are well positioned to make an impact in their post-GSB careers.”
Adds Stanford GSB Dean Jonathan Levin: “More than other classes, the Class of 2021 learned how to deal with ambiguity and uncertainty, and to be adaptable and resilient. We are thrilled to see how they are applying what they have learned, going on to incredible roles in numerous industries.”