Is an MBA Worth It?
The Costs and Benefits of Earning an MBA
With four years of college under your belt, and perhaps a few years of work experience as well, are you now contemplating getting an MBA or other Master's degree in business? Are you asking yourself "Is an MBA Worth It?" Compare the costs of pursuing this graduate degree with the benefits to your career, and you can decide for yourself.
How Much Does It Cost and How Long Will It Take to Get an MBA?
Earning an MBA involves a considerable expenditure both in time and money.
Expect to spend at least two years in school after college, if you choose to attend a full-time program. It will take you at least three years to graduate with an MBA if you attend school part-time.
Education is expensive. According to Karen Schweitzer on Thoughtco.com, "The average tuition for a two-year MBA program exceeds $60,000. If you attend one of the top business schools in the U.S., you can expect to pay as much as $100,000 or more in tuition and fees" (Schweitzer, Karen. "How Much Does It Cost to Earn an MBA Degree?". Thoughtco.com, March 8, 2017). You may be able to reduce the cost with scholarships and other financial aid. Lucky you if you work for an employer that offers tuition assistance or reimbursement. That means you will have to work while attending school though.
While you may not need an undergraduate degree in business administration or a related subject to enter an MBA program—requirements vary by school—applicants who haven't studied business in college will have to take prerequisite business classes before they can begin graduate study.
That is an added expense, and it will take you additional time to complete your graduate degree.
MBA Alumni Feel Earning Degree Is Rewarding
In a survey of 10,882 alumni from 274 graduate business programs, 94 percent described their B-School education as personally rewarding, 89 percent said it was professionally rewarding, and 73 percent reported that it was financially rewarding.
Not surprisingly, employed alumni found it more rewarding than those who are unemployed.
Alumni, revealed this survey, felt rewarded in several ways. Most agreed that their graduate education:
- "Prepared them for leadership positions"
- "Increased their earning power"
- "Prepared them for their chosen careers"
- "Developed their professional networks"
- "Prepared them to work in culturally diverse organizations"
- "Offered them opportunities for quicker career advancement"
(The Value of a Graduate Management Education: Alumni Perspectives Survey 2018, Graduate Management Admission Council.)
How Much More Can You Earn With an MBA?
Earning an MBA may bring you a higher starting salary than you could get with just a bachelor's degree in business, according to the Winter 2017 Salary Survey conducted by the National Association of Colleges and Employers (NACE). Here are examples of just a few majors in which starting salaries are higher with an MBA. As you can see, the differential is more significant for some majors than it is for others.
|STARTING SALARY BY DEGREE|
|Management Information Systems||$59,642||$75,433|
Source: Projected Top-Paid Business Bachelor's, Master's Grads, NACE (National Association of Colleges and Employers), March 8, 2017.
More Jobs and Career Advancement Opportunities?
It's good to know that having an MBA can improve your earnings and is, according to alumni, rewarding, but what are the real numbers regarding employment and advancement? The Graduate Management Admission Council's survey of alumni indicates that 89 percent of B-School grads are currently employed—79 percent work for businesses and 10 percent are self-employed (“B-School Alumni Employment Report: Alumni Perspectives Survey 2018,” Graduate Management Admission Council).
The survey further revealed that "almost two-thirds of alumni work for multinational companies, one-third work for companies with over 25,000 workers, 29 percent work for publicly traded companies, 19 percent work for Global Fortune 500 companies, 17 percent work for Global Fortune 100 companies, and 8 percent work at start-ups."
Seventy-six percent of alumni are very satisfied or satisfied with their career progression. After gaining experience, many who graduated at least 15 years ago are now in C-Suite or executive level positions.
MBAs, in general, commonly work in the products and services, technology, and finance and accounting industries. More recent graduates have been finding jobs with technology and products and services companies while earlier ones found their place in the accounting and consulting industries. Graduates work in functions including general management, finance and accounting, and marketing and sales (“B-School Alumni Employment Report: Alumni Perspectives Survey 2018,” Graduate Management Admission Council).
Jennifer DeJong, in an article on Monster, says that "MBAs are sought after for their ability to think critically, deal with ambiguity and solve complex problems...In the broadest sense, the master of business administration degree represents a way of thinking, not just a set of financial skills and business knowledge" (DeJong, Jennifer. "Why Do Some Companies Prefer MBAs,” Monster.
What Else You Need to Know About Getting an MBA
Once you decide to get your MBA, you will have several additional decisions to make. Choosing which school to attend is one of them. Not all business schools are of equal quality. There are several criteria you can use when picking a program. For example, see which schools rank best for job placement, which ones accept students with your GMAT score, and which ones have graduates with the lowest rate of debt.
Decide whether you want to attend school full-time or part-time. If you are a recent college graduate, you may opt for an Early Career MBA, or if you are a seasoned executive, an Executive MBA (EMBA) may be right for you. An online program is an option for individuals who don't live near a university that offers an MBA program or who can't fit going to school into their busy schedule. Some traditional programs offer a distance learning option.