Approximately 300,000 students are enrolled in an MBA program every year. Business by far is the most popular master’s degree for both men and women. Approximately 11.4% of women and 22.3% of men seeking master’s degrees were enrolled in a business administration program. Other popular master’s degree paths, such as education, social work, and engineering, didn’t even come close to these numbers.But with the rising cost of tuition and stagnant salaries, some are asking: is a traditional MBA worth the investment?
The average tuition for a two-year program is $82,147, with top schools such as Harvard, Stanford, Columbia, and Yale coming in at over $100,000. And this doesn’t include the cost of books, housing, and other living expenses while in school. Statistics show that many graduates with a 10-year repayment plan will owe approximately $1,300 a month for their loan payments, after interest and fees. Worse, one in five MBA graduates default on their loans, and nearly 40% rely on their parents for assistance with these payments.
While an advanced degree might typically increase your earning potential in the field, the lifetime earnings potential for someone with an MBA was only $2.4 million compared to $2.3 million for someone with a bachelor’s degree. In fact, only about 13% find jobs in the coveted consulting field, and only 1 in 4,000 alumni of the top MBA programs work their way to the highest-paid executive jobs. Many successful entrepreneurs put their time and effort into growing their companies instead of spending more years in school. In fact, Warren Buffet, Bill Gates, and Richard Branson are among some of today’s top billionaire executives and none of them have an MBA.
Now, this is not to say an MBA can’t be beneficial. However, it is important to think hard about this investment and the likely return you will see on it. Many online programs have lower tuition costs and allow you the flexibility to continue working and gaining important professional experience as you pursue a degree. That’s something to consider before you pick a program. You want your MBA to be worth your time and money.