Go to a top-tier business university, and that MBA degree might be worthwhile. Typically, however, getting an MBA makes little financial sense anymore.
Everybody has an MBA now
According to the Wall Street Journal, the early 1990s saw the rise of many part-time and executive MBA programs at lower-ranked schools, as well as online diplomas. The result is that the amount of MBA degree holders in society has gone up, but the amount of jobs has not kept pace.
Georgetown University McDonough School of Business professor Dr. Brooks Holtom noted that "An M.B.A. is a club that is now not distinctive. You need to not believe that this less exclusive club is going to confer the same benefits."
Taking a look at average MBA salaries
The result of this is proving to be some very costly stories of woe, designed for those with MBAs from schools that aren't top-tier. The figures bear this out. Average pay for graduates with minimal experience (three years or less) was $53,900 in 2012, according to data from PayScale.com. That's 4.6 percent lower than it was in 2008, and at 186 of the schools PayScale examined, pay dropped a whopping 62 percent over that time span.
Why the tremendous drop? It isn't simply due to the weak, recessionary economy. It's because business schools are dangling false hopes before students. Those with experience don't need diplomas as much, and top-tier companies tend to recruit from only the most exceptional schools. The glut of MBAs in the U.S. doesn't help matters, regardless of a company's exclusivity, and neither does the sluggish economy that retards the amount of opportunities available.
Cash cow diplomas
Business and law are cash cows for universities, but not necessarily for graduates. The prevailing advice that MBA students should heed is that unless they can gain admission to a top-10 business university, they should enter a different field. The amount of debt relative to the median salary is debatably not worth the trouble, otherwise. Learn to assess the career market before you commit to bone-crushing debt.
Everybody has an MBA now
According to the Wall Street Journal, the early 1990s saw the rise of many part-time and executive MBA programs at lower-ranked schools, as well as online diplomas. The result is that the amount of MBA degree holders in society has gone up, but the amount of jobs has not kept pace.
Georgetown University McDonough School of Business professor Dr. Brooks Holtom noted that "An M.B.A. is a club that is now not distinctive. You need to not believe that this less exclusive club is going to confer the same benefits."
Taking a look at average MBA salaries
The result of this is proving to be some very costly stories of woe, designed for those with MBAs from schools that aren't top-tier. The figures bear this out. Average pay for graduates with minimal experience (three years or less) was $53,900 in 2012, according to data from PayScale.com. That's 4.6 percent lower than it was in 2008, and at 186 of the schools PayScale examined, pay dropped a whopping 62 percent over that time span.
Why the tremendous drop? It isn't simply due to the weak, recessionary economy. It's because business schools are dangling false hopes before students. Those with experience don't need diplomas as much, and top-tier companies tend to recruit from only the most exceptional schools. The glut of MBAs in the U.S. doesn't help matters, regardless of a company's exclusivity, and neither does the sluggish economy that retards the amount of opportunities available.
Cash cow diplomas
Business and law are cash cows for universities, but not necessarily for graduates. The prevailing advice that MBA students should heed is that unless they can gain admission to a top-10 business university, they should enter a different field. The amount of debt relative to the median salary is debatably not worth the trouble, otherwise. Learn to assess the career market before you commit to bone-crushing debt.
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