MBA Salary Guide: Starting Salaries & Highest Paying MBA Concentrations (2023)
New data on the average starting salaries for graduates with MBA degrees recently appeared. The roundup below summarizes those salary surveys, then presents data correlating salaries with MBA concentrations and industries.
The average salary and bonus package that MBA graduates earned in 2021 was $105,684, according to the latest data from U.S. News & World Report. The publication based this average on reports from 131 full-time MBA programs in their 2022 U.S. News Best Business Schools chart.
Elite business schools disclosed more generous compensation, reporting a $175,789 average. The ten MBA programs revealing the highest average salary and bonus packages exceeded the average for all schools by $70,105—a staggering 66 percent gain.
These programs fell within the publication’s 15 highest-ranked programs.
The Graduate Management Admission Council’s Business School Hiring Report
In 2022, employers now offer MBA graduates the highest inflation-adjusted salary ever recorded in the United States: a median of $115,000 annually. That’s according to the Graduate Management Management Admission Council (GMAC). This is exactly the same median salary that was reported in the 2021 report.
GMAC, best known for their Graduate Management Admission Test (GMAT) and Executive Assessment (EA) business school entrance examinations, pointed out in 2021 that this MBA salary is more than twice the median of $55,000 reported for new hires with undergraduate business administration degrees.
Compared with historical trends, MBA hiring remains robust. According to the 2021 report:
In a little more than a decade, the proportion of surveyed recruiters planning to hire MBA graduates has grown significantly, a trend especially notable in Europe, where the percentage jumped from 44 percent in 2010 to nearly twice as much (86%) in 2021, and in the United States, where it grew from 56 percent to 94 percent, a 68 percent increase.
The National Association of Colleges and Employers’ Average MBA Salary Survey
NACE is an association made up of corporate recruiters and university career advisors. The group reports that the MBA class of 2022’s average salary increased by 11 percent over last year’s average to $87,966. That’s more than $29,000 greater—nearly 50 percent more—than the association’s average starting salary estimate for undergraduate business administration graduates, $58,869.
Average MBA Salary by Concentration
Obtaining a master’s degree in business administration (MBA) is a significant decision. Along the path of completing an MBA—beginning with the application process and ending at graduation—students must make many small decisions that will determine the course of their lives. These decisions include selecting a business school and type of program and other choices, such as whether to study abroad, choose an internship, and pick where they want to work and live after graduation.
The highest priority before tackling that list of decisions involves choosing a field to focus on, known as a concentration or specialization. The concentration a student selects is the second most important commitment a student can make next to enrolling in graduate management education itself.
Granted, some schools like Harvard Business School do not offer formal concentrations, and in those cases, students create de facto fields of concentration from their electives. In either case, such specializations amount to critical choices in an MBA student’s career. They permit students to deliver highly marketable skills to an employer immediately upon graduation—a value for which most employers will gladly pay a handsome salary premium.
However, before covering the salary values of different concentrations, it is worthwhile to understand how the benefits of concentrations translate into those salaries.
The Benefits of MBA Concentrations
Many experts agree that MBA graduates with a concentration have substantial competitive advantages over those without one during recruitment. For example, Raghu Sundaram, the dean of MBA programs at New York University’s Stern School of Business, told the U.S. News and World Report: “Having a specialization will not get you the job, but it certainly will make it a lot easier to get the interview. It opens the door, which is why students are so fond of specializations.”
Furthermore, some concentrations lead to higher-paying jobs. As a result, there is a dramatically wide range of earning potential corresponding to different concentrations. MBA aspirants would be wise to familiarize themselves with these earning potentials before selecting target schools.
According to Phil Miller, the assistant dean of MBA programs at the Carlson School of Management at the University of Minnesota, better-paying MBA concentrations align with sectors with higher salaries: “Students who specialize in finance and go into banking earn a disproportionate amount of higher salaries.”
He also advised students to look at where previous students of a program land in the following three years after graduation. This will help them better understand what each specialization yields for graduates.
To wisely select a concentration, most MBA aspirants first want to know which concentrations offer the highest pay. The website PayScale, which provides compensation data focusing on salary and benefits, has reported the average salary associated with MBA program concentrations for the last several years.
PayScale produces these reports using the website’s database of about 1.5 million university graduates who disclose data about themselves when they search for salary information. PayScale is a labor market database similar to other platforms, including Glassdoor, RelishCareers, and TransparentCareer.
The PayScale data does present some limitations. For one, PayScale needs a controlled vocabulary that better differentiates among concentration names. For example, the term “finance” or “financial” repeats in four concentration names and, “marketing” repeats in three. As a result, it is difficult to understand the distinct differences in how these overlapping names represent actual concentration fields at different schools.
Furthermore, these self-reported pay statistics only consider annual salaries. However, bonuses are significant income sources in management consulting, investment banking, and financial services compensation. Moreover, equity—i.e., stock options and redemptions—accounts for a considerable portion of income in the compensation packages of startups and tech firms. PayScale counts neither of these income sources in their statistics.
The Most Lucrative MBA Concentrations
In recent years, marketing has been the highest-paying concentration according to PayScale’s rankings—not just because it offers the highest pay immediately after graduation but also ten years later. In their report MBA Paths and Their Payoff, PayScale noted that alumni specializing in marketing made $55,700 a year upon graduation and averaged $116,000 at mid-career. This represents a staggering 108 percent salary increase in 10 years.
It is important to look at mid-career averages and post-graduation numbers because the former will better indicate growth potential. Besides marketing, several concentrations earn handsome annual salaries by mid-career. These include finance at $120,000, technology management at $101,000, and human resources at $73,300.
Trends in Top Paying Concentrations
Quantitative Careers Are Favored Earlier, Verbal Later
Along with marketing’s consistent lead, a couple of trends become apparent. First, quantitative concentrations dominate the top early-career rankings. Following marketing, the three top-paying concentrations are finance at $62,100, technology management at $60,000, and human resources at $45,700. The top four early-career winners are quantitative-focused.
However, this trend changes at the mid-career mark. Ten years after graduation, two of the top four paying concentrations are more verbal: marketing and human resources. However, it is interesting to note that qualitative concentrations such as finance and technology management take second and third place in terms of total wage growth in a career: finance at $3,210,000 and human resources at $2,060,000.
This trend amounts to what one might expect. Most early-career MBA jobs emphasize quantitative and technical skills, while jobs that emphasize verbal skills predominate among the more senior positions seasoned executives hold.
Concentrations Where Earnings Double
The second trend relates to how some concentrations start out with rather modest earnings, approximately double by mid-career. These concentrations also appear to place a premium on verbal concepts and reasoning rather than technical or quantitative skills. They include finance ($62,100 to $120,000), marketing ($55,700 to $116,000), technology management ($60,000 to $101,000), and human resources ($45,700 to $73,300).
The marketing concentration sees a 108 percent increase in average pay over ten years and takes the top growth rate among all concentrations. Other concentrations displaying 80 percent growth or more include finance (93 percent), technology management (68 percent), and human resources (60 percent).
Salary Examples for Key Industries and Roles
Below are some examples of salaries for specific roles at companies that heavily recruit MBAs.
Consulting firms recruit about a third of each class at many of the top business schools. Firms recruit most of these hires from strategy concentrations and some from other specializations like general management.
These examples come from lists published by Management Consulted, a coaching firm and online resource for MBA students pursuing careers in consulting.
|Base||Performance Bonus||Signing Bonus||Relocation|
|McKinsey & Company||$192,000||$45,000||$30,000||$10,100|
|Boston Consulting Group||$190,000||$50,000||$30,000||Interest-free loan|
|Bain & Company||$192,000||$63,000||$30,000||$8,000 – $16,000|
|Parthenon-EY||$175,000||$26,250 – $52,500||$30,000||NA|
The following tables have been created from the TransparentCareer website.
About 80 percent of the jobs summarized in the following table fall within only three categories of functional roles: product management, marketing, and corporate finance, in declining order based on the proportion of all roles for MBA graduates.
|Total Compensation||Average Salary||Average Hours/Week|
Functional roles in the hardware industry vary widely; most of the jobs summarized in the following table fall within product management and operations roles. Note the average hours worked that the Apple employees reported.
|Total Compensation||Average Salary||Average Hours|
E-Commerce and Internet
Just like the table above, about 80 percent of the jobs summarized in the following table fall into three categories: product management, marketing, and corporate finance, in declining order based on the proportion of all roles for MBA graduates. Again, note the part that stock compensation plays in addition to salary.
|Total Compensation||Average Salary||Average Stock Comp.|
The following table includes data from TransparentCareer. Many of these hires likely graduated with finance concentrations.
Three of the four banks on the list display average hours worked that are almost double the standard United States 40-hour workweek. Such astonishing hours persist within this industry despite widespread reports that MBAs are increasingly accepting technology jobs with better work/life balances than those offered by Wall Street. Find out more in our Guide to MBA Careers – Business Administration Career Paths.
|Total Compensation||Average Salary||Average Bonus||Average Hours Worked|
|Bank of America Merrill Lynch||$251,750||$128,500||$76,750||75|
|Goldman Sachs Group Inc.||$247,521||$128,571||$53,571||75|
The following table consists of data from another TransparentCareer report.
|Total Compensation||Average Salary||Average Hours|
|The Vanguard Group||$157,205||$100,180||60|
Consumer Product Marketing
About 70 percent of the roles summarized in the following TransparentCareer table are for marketing jobs geared to MBA grads with marketing concentrations. The salaries appear to be almost one-third lower than those paid by the top consulting firms.
|Total Compensation||Salary||Signing Bonus|
Brand Management and Strategy
Finally, data in this TransparentCareer table parallels the consumer product marketing table above.
|Total Compensation||Salary||Signing Bonus|