GMAC press release offers some optimistic news on the MBA job-front: The median salary for b-school alumni who graduated in the past ten years is continuing to grow as the global economy improves. In 2007 the median base salary was $89,000; in 2010 that number had increased to $94,500.
Another improvement: 93% of recent MBA graduates are employed, according to GMAC’s Alumni Perspectives Survey, compared to 90% in 2009. (The percentage is slightly lower, however, than the 95% rate in 2007.)
According to a BusinessWeek article that looks at the GMAC survey results critically, “MBA Pay is Up! Maybe,” the numbers actually reveal “a mixed bag.” Louis Lavelle (the author of the BW article) points out that if people who earn the highest salaries are the ones who responded to the GMAC survey, then obviously the numbers will reflect a high base salary—58% of respondents got their MBAs in 2008 in earlier (which means their salaries are likely higher than those of more recent grads) and one-third of respondents came from high-paying consulting or financial services jobs. The 7.2% of self-employed or entrepreneur respondents and the 6.9% of unemployed respondents aren’t even taken into account when calculating the average; if they were, that $94,500 figure would be significantly lower.
Lavelle points out another shortcoming in the GMAC results—the fact that inflation is not considered when comparing the 2010 results with the 2007 results. According to GMAC, the pay growth between these two periods is about 6.2%, but adjusting for inflation, the $89,000 salary in 2007 would equal about $95,277 in 2010, which is more than the reported 2010 average of $94,500, not less.
Lavelle concludes his critique by quoting Michelle Sparkman-Renz, director of research communications at GMAC, who maintains that while GMAC’s survey results are “subject to fluctuations in response rates from different graduation cohorts and industries…the numbers are generally reflective of the pay and employment status of alumni.”
“Salary is more than one number,” she told me. “I’m definitely aware that our survey every year reports from a different sample. There are a kaleidoscope of things that determine salary: choice of industry, organizational focus, different job levels, years of work experience. All of these things can determine earnings. I feel very positive about it.”
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