Obtaining a Master of Business Administration (MBA) degree is a significant accomplishment, offering many benefits to young and mid-career professionals for career growth. The knowledge and training can position the graduate to introduce and implement sound business practices into their career.
Beyond career advancement opportunities, the salary level offered is one of the most coveted benefits of getting the degree. It's safe to say that the motivation for pursuing a postgraduate education boils down to the potential of increasing wages. So, what can you earn with an MBA and which factors influence your compensation?
Key Takeaways
- The salary level offered is one of the most coveted benefits of getting an MBA.
- The average annual salary for an MBA graduate depends on the school where the degree was earned.
- Geography and gender can also play a role in an MBA graduate's earning potential.
The Average MBA Salary
Among the 146 ranked full-time MBA programs that reported to U.S. News & World Report for its annual MBA survey, the overall average base salary plus bonus paid to 2023 graduates was $128,997.
Compensation projections published by the National Association of Colleges and Employers predict that the average starting salary for MBA grads in the class of 2024 will be $75,303—6.2% lower than the predicted average starting salary for 2023 grads.
$182,500
The 2023 average starting salary plus bonus for those emerging from Stanford University's Graduate School of Business. Stanford MBAs consistently rank highest on the starting pay scale.
Still, these numbers must be taken with a grain of salt. Many grains of salt. MBA salaries vary based on each individual, specific career path, and the school from which they got their degree. Those six-figure starting salaries tend to be at the top 30 business schools, where they range from $166,650 (UC-Berkeley) to $182,500 (Stanford University's Graduate School of Business), according to Poets & Quants, an online publication that covers the B-school industry.
According to PayScale's survey of tens of thousands of MBA graduates, the average salary of MBA graduates is estimated much lower at $98,000, with typical jobs ranging from financial analyst ($70,237 average) to financial controller ($97,749 average) to chief financial officer ($160,919 average).
Of MBA graduates, approximately 1.3% of participants had less than one year of work experience, whereas 32.3% were experienced, and 27.4% reported that they were mid-career graduates. Based on these results, work experience and rank contribute significantly to an MBA’s salary.
Salaries by Geography and Gender
Where a job is located can influence the salary. ZipRecruiter (which uses data compiled by employer job postings and third-party research) has a slightly larger overall number compared to PayScale: As of 2024, the average pay for MBA jobs in the U.S. was $165,372 a year.
However, ZipRecruiter also parses MBA pay by state, revealing some interesting disparities. Annual average salaries on the East and West Coasts tend to be the highest:
| Washington | $200,825 |
| New York | $179,210 |
| Vermont | $175,826 |
| California | $171,250 |
| Arkansas | $124,272 |
| Florida | $121,108 |
Gender is another variable that can skew an average salary. Men on average earned between $61,000 and $177,000, while women earned between $53,000 and $148,000, according to PayScale (whose gender measures compare only men and women). When it comes to comparing the average MBA salary, there is still a lot of progress to be made in terms of the gender wage gap.
No matter what the industry, the median annual wage for those with an MBA is greater than for those with just a bachelor's degree. The disparity is greatest among securities, commodities, and financial services sales agents, where those with MBAs earn 89% more, according to the BLS.
Salary Variations by MBA Profession
The average MBA salary also varies according to industry and profession. Some graduates made close to twice as much as others based on the field entered.
For example, according to the U.S. News survey, MBAs specializing in consulting topped the list, having an average base salary of $152,470—$22,500 better than financial services, the second-highest industry. From there, technology management followed, with $124,289. Retail ($108,270) and real estate ($107,552) were other hot areas. Not surprisingly, nonprofit ($85,154) and government sectors ($80,520) were at the bottom.
Depending on the field, however, some MBA career investments also age better over time, according toPayScaledata provided toPoets & Quants for a recent joint study. For example, although innovation management started at a lower early-career pay of $62,600, it had doubled to $134,000 by mid-career. The same was true of entrepreneurs and the average MBA salary of those who had concentrations in marketing and finance.
What Are the Requirements for an MBA Program?
Prospective MBA students must apply to the school(s) of their choice and may be required to write the GMAT or GRE and submit academic transcripts. You must have an undergraduate degree to apply. Some schools may also require letters of recommendation, a personal essay or statement outlining your reason for applying and career goals, and work experience.
What Specializations Are Available for MBA Students?
MBA students can specialize in a variety of fields, including marketing, healthcare management, human resources, management, consulting, information technology, finance, leadership, real estate, and entrepreneurship. Keep in mind that this isn't an exhaustive list, so the options are fairly wide ranging.
What Are the Career Options for MBA Graduates?
People who graduate with an MBA can find work in different fields. For instance, graduates can work in sectors like finance, technology, and healthcare to name a few. They can find work as chief financial officers, financial analysts, investment bankers, accountants, management consultants, marketing managers, sales managers, and human resources managers among others.
The Bottom Line
For many prospective students, perhaps the greatest concern is whether earning a prestigious MBA degree is cost-effective. With numerous factors to consider, the question of average MBA salary is based on individual circ*mstances, usually involving a combination of factors.
While the individual B-school can be important, experience and job types are the biggest influencers on MBA compensation. As an employee invests time on a specific career path, it is reasonable to expect progressive increases in salary. Gender and location also play a role in determining the level of pay, although not to the same degree as the two preceding variables.
No education is a waste. With time and effort, obtaining an MBA can provide access to certain career opportunities.It can help take the graduate as far as their ambition will allow.
Article Sources
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U.S. News & World Report. "Find MBAs That Lead to Employment, High Salaries."
National Association of Colleges and Employers. "Winter 2024 NACE Salary Survey, Executive Summary," Page 4.
Poets & Quants. "MBA Salaries, Bonuses & Job Success Rates At 30 Top U.S. B-Schools."
PayScale. ”Master of Business Administration (MBA) Degree.”
ZipRecruiter. "MBA Salary."
ZipRecruiter. "What Is the Average MBA Salary by State."
U.S. Bureau of Labor Statistics. "Should I Get A Master’s Degree?"
Poets & Quants. ”The Highest Paying MBA Concentrations of 2017.”
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