The University of Chicago’s business school was always considered a finance school, but that changed in 2017 when consulting became the top industry for graduating MBAs. This year, banking made a big comeback at the Booth School of Business, hot on consulting’s heels — and the starting salaries reported by Class of 2022 MBAs in the finance game lifted all of Booth’s boats.
Total median compensation for Booth’s latest graduating class grew 10.1% year-over-year — more than twice the rate of growth of the previous class — to $196,600, according to the B-school’s employment report. While median signing bonuses dropped $5K to $30,000 after a one-year bounce, median base salary grew 13% to $175K, on par with fellow M7 stalwart Harvard Business School and exceeding regional M7 rival Northwestern Kellogg School of Management.
Even though banking led the fleet, the school’s top three employers were the big global consulting firms. McKinsey hired 61 Boothies, followed by the Boston Consulting Group (53), and Bain & Co. (28) (see table of top employers on following page). Still, the percentage of Boothies who found work in the sector skyrocketed 8 points to more than 35%, with every sub-sector but one growing as a destination (see table at the bottom of the page for details) — and the bankers made, ahem, bank: Median financial services salaries climbed to $175K from last year’s $160K, with private equity and investment management — together accounting for more than 10% of the entire class — growing their median base salaries 6.7% and 13.3%, respectively. For the entire industry, the minimum salary grew 22% to $110K, and the maximum grew 33% to $300K; the latter figure is the highest reported by Booth for any industry in 2022.
THE COLLAPSE OF TECH — BUT NOT TECH SALARIES
For all that, consulting remains the top industry at the Booth School, though only barely, with 35.5% of the class's 538 job seekers to finance's 34.1%. The MBB firms made up the top three employers of 2022 Boothies, with 11.3% of the class (61 graduates) going to work for McKinsey, 9.9% (53 hires) to Boston Consulting Group, and 5.2% (28 hires) to Bain & Company. Median consulting salaries matched finance at $175K, though both consulting's minimum ($71K) and maximum ($230K) were much lower.
"Booth’s Class of 2022 experienced an excellent job market and increases in compensation packages," says Stephanie O’Connor, the Booth School's associate dean for career services. "The increase in compensation packages can be attributed to a shift in industry mix and in some industries, an increase in median base pay. We also hear from firms that Booth students are well prepared to hit the ground running. Through their course work and leadership experiences, Booth students take on functional roles that demonstrate the value of an MBA, such as investment banking, consulting, and product management."
The most noteworthy change in placement was in tech, which after many years of steady rise has fluctuated wildly since the onset of the pandemic. In 2021, tech jumped more than 40% to 23% of the class (see chart below), but in 2022 it plummeted off a cliff, falling by 35%, 8 full percentage points, to 14.9% from 22.9%. That's the lowest proportion of a Booth class to go into the tech sector since 2014. Though Amazon was the fourth-biggest employer of Boothies in 2022 with 22 hires (4% of the class), every tech sub-sector but one declined: E-commerce/internet dropped to 9.1% from 13.5%, software to 3% from 6.5%, hardware to 0.4% from 0.7%, and telecom to nothing from 0.4%. Only fintech grew, to 1.5% from 0.9%.
Relatedly, Boothies headed to the startup world were halved in number, to just 3% of the class. For comparison, HBS's share of entrepreneurs was 14% this year, up from 12%, and Stanford was 18% in 2021 and 2020.
"Technology students were in high demand this year," O'Connor notes, "and while a smaller portion of Booth graduates entered this field, median base salaries moved from $133,000 in 2021 to $146,000 in 2022."
BIG INCREASE IN NEW YORK-BOUND BOOTHIES
It will come as no surprise, given the drop in tech jobs, that the percentage of Boothies who relocated to the West Coast dropped precipitously, to just over 20% from 26.8% last year. That includes 11.9% in the San Francisco Bay Area, 5.2% in Seattle, and 2.4% in Los Angeles — all down significantly.
The recent history of Booth's MBA outspread is interesting. In 2019, the largest single group of graduating MBAs from Chicago Booth stayed in the Midwest (28.9%), with 26.1% taking jobs in Chicago. About 21.7% of the class headed to the West Coast, with 13.5% in the Bay Area, 6.1% in Seattle, and 2% in L.A. A nearly equal percentage (21.3%) accepted jobs in the Northeast, mainly in New York, which accounted for 18% of the class. In 2020, in the vice of coronavirus, even more Boothies stayed local: 32.7% in the Midwest and 29.5% in Chicago. West Coast numbers were up that year, however: 24.6% headed for the coast, with 14.5% to the Bay Area, 6.2% to Seattle, and 3.7% to L.A. And New York got more Booth MBAs in 2020, as well: 22.6% went to the Northeast, including 18.9% to the Big Apple.
Last year, as pandemic pressure on the job market eased, the Midwest numbers were down to 29.6% (Chicago 27.2%); West numbers climbed again, to 26.8% (Bay Area 14.6%); and the Northeast dipped slightly to 21.8% (NYC 17.9%). So, if they eschewed the tech work of the West Coast, where did Boothies mostly go in 2022? More stayed in the Midwest (30.9%), though slightly fewer stayed in Chicago (27%). But the big increase was in the Northeast, where the finance jobs are, which climbed to 29.2% of the class. New York lured the lion's share: a full quarter, 25.1%.
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