The two MBA “pandemic classes” had it tough, no doubt about it. Harvard is the latest elite U.S. business school to show that the struggle was worth it.
One year removed from an employment report that saw its MBAs go backward in total compensation, Harvard has released a trove of jobs data showing that 2022 was a return to form, and then some. Massive jumps in median salary and median total pay serve as a reminder to everyone that an elite MBA — and even more so, a Harvard MBA — is a ticket to socioeconomic advancement.
MEDIAN SALARY UP 16%, MEDIAN TOTAL COMP UP 17.5%
In 2021, HBS reported that overall median salary was up only slightly from 2020, to $150,500 from $150K, while total median compensation slipped to $189,850 from $193,200, a decline of about 1.2%. Harvard’s 2021 total pay lagged the pre-pandemic Class of 2019 by about a third of 1 percent.
Of course, 2021 was a far different landscape for newly minted MBAs, from the top tier down. The pandemic was still very much a factor in the classroom and outside of it. This year, HBS grads had fewer challenges and saw bigger rewards, including a huge 16.3% year-to-year increase in median salary to $175,000 (see table above). Median signing bonuses remained at $30,000, where they have been since 2019, but median performance bonuses increased to $40,000 from $37,000.
The latter, plus the muscular salary increase, powered a leap in total median compensation to $223,100, an incredible one-year jump of 17.5%.
3 FINANCE FIELDS EXCEED MEDIAN $100K IN PERFORMANCE BONUSES
Placement rates had already rebounded for Harvard in 2021, with 96% of those who were seeking work receiving an offer three months after graduation and 92% accepting, up from 90% and 83% respectively during the worst of the health crisis. This year's HBS grads had a slightly harder time finding the right fit, with 95% receiving offers and 90% accepting after 90 days.
No major change occurred in the top three industries, with just over a third of the class filling various financial services roles, about the same as last year, consulting ticking upward to 26% of the class, and tech flat at 19%. See table below for top three industry trend lines through the years.
Most financial services jobs reported a median base salary of $175,000, and consulting also reported a base of $175,000. Tech had a base of $165,000. Investment banking and investment management/hedge funds, under the financial services umbrella, reported a median signing bonus of $50,000, leading all industries; consulting and tech both reported a median $30,000.
Finance fields really shone in performance bonuses, with banking reporting a median $125,000 and management $168,000, while private equity — comprising 15% of the class — topped them all at a whopping $175,000. Consulting grads reported a median $30K performance bonus; tech grads, $26K.
2022 HEDGE FUND MBAs MADE A MEDIAN $343,940
Consulting paced all other industries in 2021, with total median pay for Harvard graduates hired on by the MBB firms and other consultancies up to $211,800. Accepted consulting offers last year were comprised of a starting salary median of $165K, a $30K signing bonus given to 95% of those going into the field, and other guaranteed comp of $30K, reported by 92% of the students.
This year, consulting median total pay climbed to $230,200, up 8.7%. Consider that 2021's total was an 8.4% increase from the 2020 mark of $195,336, and a pattern emerges. (For the curious, in 2019, Harvard's consulting crowd reported $194,880 in total pay, reinforcing the struggles that 2020 grads faced.)
At the top end of the pay scale in 2021 was the 8% of the latest class to head into hedge funds and investment management jobs, for whom the median total compensation totaled a gobsmacking $279,900, up from $203,307 in 2020, with median salaries of $165,000 (up from $152,682), sign-on bonuses of $50,000 (from $27,500), reported by 50% of the students, and a gargantuan $145,000 in other guaranteed comp landed by 62% of the grads, up from $132,500 the previous year. The latter was the main cause of a 38% year-to-year jump in total comp for the hedge fund crowd.
This year, once again hedge funders comprised 8% of the class, and once again they made a lot of money — starting with an incredible $175K median base, plus $50K median signing (reported by 59%), plus a ludicrous $168K median performance bonus (reported by 83%), equaling an astounding median total compensation of $343,940. This just edged out the private equity folks, whose total comp equaled $334,300 ($175K base, $30K signing bonus received by 41%, and $175K performance bonus received by 84%). The 7% of the class who went into venture capital made starvation wages in comparison, with a median base salary of $178K and total compensation of $215,350.
See pages 2 and 3 for tables with complete industry and region placement and pay data for the HBS MBA Class of 2022.