MBA Pay: A Crystal Ball

Exclusive new research shows how much graduates of top business schools earn over the course of their careers What’s your MBA really worth? Well, a lot depends on what you mean. In their marketing materials, elite business schools focus on starting salaries, which can be quite impressive. But what about 5, 10, even 20 years out? For a long time, that’s been terra incognita”a no-man’s-land of guesswork and supposition. Not anymore. New research commissioned by BusinessWeek suggests that when it comes to the post-MBA earnings accrued by graduates of top business schools over the span of their careers, not all schools are created equal. Some schools that start out strong with six-figure salaries sometimes sputter and stall, leaving grads with less-than-impressive salaries after 20 years in the workforce. And some schools where grads earn modest salaries out of the gate end up with the strongest of finishes, in some cases doubling their cash compensation after 20 years and overtaking better-ranked rivals. (See our interactive table MBA Pay Through the Years at 45 Top Programs.) The research comes from PayScale, which collects salary data from individuals through online pay comparison tools. BusinessWeek asked PayScale to dig into its database of 80,000 graduates of 45 top MBA programs and calculate their median cash compensation”salaries and bonuses”during the first five years of their careers and after they have an average of 5, 10, 15, and 20 years under their belts. BusinessWeek then used that data to calculate an estimate of median cash earnings over the entire 20-year span. The data suffer from some inherent limitations”it doesn’t include stock or options, and the pay data for some smaller schools at the 20-year mark may be based on fewer than 100 pay reports. It...

What now for MBAs?

Even in a down economy, MBAs can still navigate a great career path ” if they know where to look In the wake of the economic crisis, applications to business schools are on the rise, as college grads and business professionals seek shelter from an ugly job market. Some are re-tooling for the rebound; others are plotting alternative career tracks, now that Wall Street ” which typically absorbs 30 percent of new MBAs ” has retrenched, and as top companies in almost every industry are slashing headcount and budgets. Where, then, are the best opportunities for aspiring business leaders? BNET talked to b-school professors, recruiters, and companies and identified four career tracks where demand for management talent is likely to remain strong through the recession and beyond.Read full...

The Finance MBA: Life Beyond Wall Street

finance programs aren’t likely to change much in response to the Wall Street collapse; what will change the most are graduates’ expectations For years, finance ” and more specifically, investment banking ” has been the single most popular career track for MBAs. In fact, top schools like University of Pennsylvania and New York University typically send at least 45 percent of graduates to financial services and investment banking firms each year, with Wall Street absorbing the vast majority of those MBAs. That was then. This year, the sector is wheezing from the collapse of at least five major financial institutions and the loss of more than 200,000 jobs ” 60,000 in New York alone. Business-school professors and their career advisers say their finance programs aren’t likely to change much in response to the Wall Street collapse; what will change the most are graduates’ expectations. Investment banks that handle M&As, for instance, will still need qualified new hires. But be warned, says Ed Fredericks, a professor and career adviser at Pepperdine University’s Graziadio School of Business and Management: “The jobs aren’t going to be as lucrative, exciting, or crazy as they were before.”Read full...