Getting an MBA is a big deal, and it’s not just about the degree. It’s about the connections you’ll make, the skills that you’ll learn, and the opportunities you’ll have.
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But as much as we love our MBAs, there’s no denying that they come with a high price tag. The average cost of tuition for an MBA program at a top business school is $100K (and that’s just tuition!), so it makes sense to want to get the most out of your investment by making sure that your MBA pays off in the long run.
So how much will you earn on average after five years with your MBA? What can you expect to be making? Well, we’ve got some good news: according to PayScale’s analysis of more than 1 million MBA graduates with comparable education and experience levels, MBAs earn an average salary increase of $61K after five years!
Average Mba Salary After 5 Years
A new analysis from U.S. News & World Report calculates how much more graduates from the class of 2016 can expect to make in the five years after earning their MBA than they did before enrolling.
According to a new analysis from U.S. News & World Report, the average salary for an MBA graduate five years after earning their degree is $38,286—about $10,000 more than what they made before enrolling in business school.
The study also found that these graduates earned on average 8% more per year than they did before enrolling in their MBA program, which comes out to an increase of around $3,800 per year. This means that even though these graduates saw only modest raises at first (between 1% and 3%), their salaries grew by much larger amounts later on in their career as they became more established and gained greater responsibility.
MBA grads earn an average salary of $102315 before enrolling, which rises an average of $36145 by year five, analyzed U.S. News, for $382860 total or a 37% premium over the pre-MBA salary, with an average annual increase of 8%.
What is the average salary of an MBA grad?
In general, an MBA graduate can expect to earn about $102315 before enrolling at a school, and this rises an average of $36145 by year five, analyzed U.S. News & World Report for Business Insider. That’s a 37% premium over their pre-MBA salary, with an average annual increase of 8%.
How does this compare to other industries?
The pay bump is on par with what you’d see in other high-paying fields like law and medicine: according to PayScale’s Salary Negotiation Guide, it’s common for entry-level lawyers or doctors to command starting salaries in the low six figures (and often more), which rise rapidly over time through promotions and raises. It also compares favorably with other high-earning professionals like software engineers who might earn between $95k–$126k before they land their first jobs; however they won’t see quite as steep a raise as those pursuing MBAs
The percentage increase is roughly in line with other analyses. Earlier this year, PayScale reported that MBAs can expect to see an 84% increase in their pay, but only over a 25-year career and when not accounting for opportunity costs. In a separate analysis, PayScale determined that graduates of top 10 MBA programs can expect an increase of 99%, while those graduating from programs ranked 11-20 will have a pay increase of 56%.
If you’re an average MBA graduate, then you can expect a salary increase of 37% over five years. This is roughly in line with other analyses of the same data. Earlier this year, PayScale reported that MBAs can expect to see an 84% increase in their pay, but only over a 25-year career and when not accounting for opportunity costs. In a separate analysis, PayScale determined that graduates of top 10 MBA programs can expect an increase of 99%, while those graduating from programs ranked 11-20 will have a pay increase of 56%.
The average salary before going to business school was $102,315 per year; after graduation it was $382,860 per year—an increase of more than three times more than what they were making prior to enrolling at business school!
