MBA salaries in the United States are the highest on record in 2019 with the median annual base starting salary at $115,000, more than double the median for new bachelor’s degree hires ($55,000) and the highest ever recorded in the US when adjusted for inflation, according to the GMAC’s Business School Hiring report.
The median MBA starting salaries are highest in the consulting ($135,000) and finance/accounting ($125,000) industries in the US, the report, based on findings of the annual Corporate Recruiters Survey, said.
More than 1,200 employers in 45 countries had participated in the survey providing insight into the current market and hiring trends among MBA and business master’s graduates, GMAC said in a press release.
The Graduate Management Admission Council (GMAC), a global association of leading graduate business schools, had prepared the report in partnership with MBA Career Services & Employer Alliance and European Foundation for Management Development (EFMD).
“Employers clearly place a high value on acquiring MBA and business master’s graduates,” said Sangeet Chowfla, President and CEO of GMAC.
“We are seeing a highly active candidate marketplace in terms of geographical shifts in study destinations, but the value that both employers and graduates see in an advanced business degree is a constant,” he added.
The report said, overall, most employers plan to increase MBA starting salaries in 2019 (56%), including 63% of Asia-Pacific employers, 56% of US employers, and 49% of European employers.
The median annual base starting salaries vary considerably by world region. While European companies plan to offer new MBA hires $95,000, the median for Asia-Pacific companies is $45,000.
The US companies’ international hiring plans are similar to last year. The recent H-1B rule changes could positively impact 2020 hiring, GMAC said.
This year, 48% of US employers either plan to or are willing to hire international candidates, about the same as 2018 (47%) and down from 55% in 2017. This year’s survey was fielded in February and March, before the recent H-1B rule change became official on April 1.
The rule change stands to benefit international graduates with advanced degrees from US institutions of higher education over graduates with bachelor’s degrees.
“There has been a feeling of uncertainty in recent years around the direction of US visa policy, which is impacting international hiring and application trends,” Chowfla said.
“It will be interesting to see how much positive impact this rule change may have on both the flow of international students to the US and their employment opportunities,” he added.
Despite the MBA hiring projections remaining strong relative to historical trends, for the second consecutive year, a smaller proportion of companies overall report plans to hire MBA talent compared to the previous year. Among US employers, 77% plan to hire MBA talent in 2019, down for the second consecutive year.
A slightly smaller proportion of responding US companies report plans to grow and expand this year (66%) compared to last year (69%), as worries associated with talk of trade wars and higher tariffs may be impacting employer plans.
Nearly nine in 10 (87%) companies in Asia-Pacific plan to hire MBAs in 2019—the highest share of any world region, though off slightly compared to last year (90%). Nearly 7 in 10 European companies plan to hire MBAs in 2019 (69%), up from 2018 projections (64%).
The report found that international hiring was on the rise among Asia-Pacific and European companies as US companies continue to pull back. Seventy-one per cent and 69% of European and Asia-Pacific companies, respectively, either plan to or are willing to hire international candidates in 2019, both up from recent years.
Reasons differ for not hiring international talent. US employers are more likely to cite uncertainty about future changes in policy/law as a factor (25%), which further emphasizes the potential positive impact around the recent H-1B rule change. While in European or Asia-Pacific companies, 15% and 11% respectively cite policy/law as a determining factor in hiring.
“Our recent research reported on the decline in US companies recruiting international students from MBA and speciality master’s programs based on uncertainty about economic conditions,” said Megan Hendricks, Executive Director for the MBA Career Services & Employer Alliance.
“While the decline in this year’s GMAC report holds steady with regard to US business’ plans to hire foreign talent, we hope the recent H-1B visa rule change will encourage students to study in the US in order to diversify b-school classrooms and talent pools,” she added.
“This year’s GMAC report on MBA and GME hiring trends shows the tremendous opportunities graduates have when they finish their business studies,” said Eric Cornuel, Director General & CEO of EFMD.
“The growth of quality business schools around the world has also been met with increased employment opportunities for graduates in emerging markets and regional economies. Now is an exciting time to be pursuing an MBA and business master’s degree,” he added.
GMAC also released a new Career Aspirations Report based on 10 years of data from the mba.com Prospective Students Survey. The new report highlights how the mix of GME candidates’ aspirations for their careers post-GME have shifted over time, as now a greater share of candidates seek to enhance their current career path (41%) than switch job functions (36%) or industries (27%).
Candidate interest in consulting is high, as 36% identify it as a job function and industry of interest. Other industries of interest include finance/accounting (34%), products/services (27%), and technology (19%). The desire for international employment also rose slightly (2%).