Income Inequality

Looking to Double Your Salary? Try an M.B.A.

12/9/18
from The Wall Street Journal,
12/7/18:

Yes, the cost of business school is soaring, but a new survey shows that career-switchers can reap substantial financial rewards from getting their masters of business administration.

Fully 75% of those who earn an M.B.A. switch careers, a new survey shows, and they can double their salary by doing so. But the survey of thousands of graduates from dozens of U.S. business schools also reveals that the pay gap between men and women persists—except in the tech sector. At a time when the cost of business school is skyrocketing and enrollment in many programs is declining, The Wall Street Journal, in partnership with Times Higher Education, polled nearly 7,000 alumni who earned master’s of business administration degrees between 2012 and 2015 on their salary history and career-switching opportunities. M.B.A.s from the Yale School of Management, Stanford Graduate School of Business, Jones Graduate School of Business at Rice University, among others, reported making tens of thousands of dollars a year more after graduating from the two-year programs. The results show that the credential sought-after by generations of bankers and consultants still helps those graduates get ahead at work.

Dan Driscoll decided to get his M.B.A. at the McCombs School of Business at the University of Texas after leading a nonprofit youth soccer program in Washington D.C., for which he taught himself to code in order to manage the group’s website. With a newfound passion for tech, Mr. Driscoll interned with travel website Expedia Inc. and launched his own startup before graduation. The 36-year-old is now a senior product manager at Home Depot Inc. He credits his stint at McCombs with illuminating a career path he didn’t know existed before business school.

Still, many people in the generation of college graduates who entered the workforce in the immediate aftermath of the 2008 financial crisis are skeptical that the M.B.A.’s price tag, which has risen precipitously in recent years and now can run into the six-figure range, is worth the risk.

The number of applications to American business schools has declined for four years running, a trend that hit elite schools including Harvard and Stanford universities this year. As an alternative, online M.B.A. programs and one-year master’s degrees in business have proliferated as a way to attract young professionals who are loathe to pause their careers for full-time studies or take on additional debt to fund another degree. And business school is not a golden ticket that allows everyone to pull off the dramatic career switch they dream of, several students said.

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