Why an MBA, and why now? - Desert Path Marketing Group

If you’re considering a master’s degree in business, you likely are in one of two groups of people: Those who will graduate soon with a bachelor’s degree and want to pursue a master’s right away, or those who already have some experience in the business world and have seen the benefits that an MBA would provide.

In either case, this guide will show you the value of an MBA, both upon graduation and long-term. It will discuss the importance of earning a graduate degree from a quality school like Manhattan College in New York. And it will introduce you to successful people in many fields who have MBAs and have risen to top positions in their companies.

How much is an MBA degree worth?

Pursuing an MBA is a significant investment, in both time and money. How does that investment pay off? What are the benefits of the degree?

In earnings alone, the payoff can be significant. Each year, the Bureau of Labor Statistics calculates the increases in salary that accompany a master’s degree. In the 2015 report, the bureau noted that a worker with a high school diploma earns an average of $678 per week; one with some college earns $738; with an associate’s degree, $978, and with a bachelor’s degree, $1,137. However, with a master’s degree, that worker’s pay rate rises to an average of $1,341 a week, almost 20 percent higher than that of the worker with a bachelor’s degree.

“Among all occupations in 2013, business, financial and sales occupations had some of the highest wage premiums for workers with a master’s degree,” the report said.[i]

Perhaps in a reflection of this, the MBA became the most popular advanced degree in 2010-2011 in the United States, according to Department of Education statistics. MBAs accounted for more than 25 percent of all master’s degrees in that year, which was higher than the number awarded to education majors for the first time.[ii] The next year, MBAs moved even further ahead.

In addition, Labor Bureau statistics show that the unemployment rate drops as education rises: Workers with only a high school education have a 5.4 percent unemployment rate; those with some college have a 5.0 percent unemployment rate; with an associate’s degree, a 3.8 percent unemployment rate, and with a bachelor’s degree, a 2.8 percent unemployment rate. Workers with master’s degrees, however, fall to a lower rate still, of 2.4 percent.[iii]

What will my earnings be with an MBA?

“Higher levels of educational attainment are associated with higher earnings for a variety of reasons,” says a 2014 report by the Urban Institute. “Earnings differentials have grown most in recent years for those with advanced degrees.”[iv]

“A business degree remains one of the most predictable paths to success and financial stability and can provide the proverbial leg up from relative poverty to great accomplishment and wealth,” said Srilata Zaheer, a dean at the University of Minnesota, in Fortune magazine.[v]

When the MBA class of 2014 graduated, students expected an average increase in salary of 80 percent over their pre-MBA earnings, according to the 2014 Global Management Education Graduate Survey. Indeed, the average salary increase was 79 percent for full-time MBAs and 58 percent for part-time or flexible MBAs.[vi] New hires expected to earn $95,000 in the United States and $83,000 in Western Europe.[vii] And when alumni from MBA classes from 1959-2013 were surveyed, 88 percent said that their salaries increased post-graduation. Their salaries in the United States today average $110,000, and 33 percent said their total net worth was more than $1 million.[viii]

“The expected median starting salary for recent MBA graduates in the United States will be $100,000 this year,” said Fortune magazine. “That’s an increase of $5,000 from last year’s salaries and a $45,000 advantage over … candidates with bachelor’s degrees.”[ix]

Job Outlook for MBAs

Both salaries and business-school enrollment dropped during the recession, but both are bouncing back, according to the Graduate Management Admission Council (GMAC).[x] “Worldwide, more than half (54 percent ) of companies say they’re sweetening starting pay for MBAs. U.S.-based employers plan to offer median salaries of $105,000, up a bit from $100,000 last year,” wrote Fortune magazine in mid-2016 in an article titled, “The Job Market for MBAs is the Best Since 2010.”[xi]

Even during the recession, MBA graduates continued to find jobs while those with less education could not. A report by Georgetown University’s Center on Education and the Workforce found that workers with master’s degrees gained 253,000 jobs from December of 2007 to January of 2010, a time period in which employment statistics fell for every other group.[xii]

U.S. World and News Report recently highlighted 6 top jobs for MBA grads: marketing managers, human resources specialists, logisticians (those who help coordinate efforts across multiple disciplines), medical and health services managers, fundraisers and financial advisors. All “offer robust growth, comfortable salaries and modest unemployment rates,” the magazine said.[xiii]

What is the demand for MBAs like?

“Employer demand for recent MBA and non-MBA business master’s graduates is high, according to more than 800 corporate recruiters who participated in the 2016 Corporate Recruiters Survey,” says the GMAC report.[xiv] “Nine out of 10 U.S. employers (91 percent) report plans to hire recent MBA graduates this year, compared with 84 percent who hired these candidates last year,” the report said. In addition, 88 percent of those companies say they plan to recruit MBA graduates on campus, which is five percent higher than in 2015.

The MBA Career Services & Employer Alliance, a trade group, confirms that on-campus recruitment of MBA graduates is increasing. It surveyed 104 business schools and found that 51% have seen an increase, especially technology (startups in particular), consulting and health care.[xv] The Bureau of Labor Statistics expects a 6 percent increase in the number of economists,[xvi] a 14 percent increase in the number of management analysts (consultants)[xvii] and a 17 percent increase in the number of medical and health services managers[xviii] from 2014-2024, all jobs in which MBAs are common. The Bureau expects those rates to be as fast as or faster than average in growth.

That growth holds true in all four major regions of the United States. In 2015, 88 percent of companies in the Northeast hired MBA grads; in 2016, that number is expected to grow to 95 percent. In the Midwest, the numbers are 89 percent in 2015, 94 percent projected in 2016. In the South, it was 84 percent in 2015 and 89 percent projected in 2016. And in the West, actual hiring in 2015 was 75 percent; it is projected to be 88 percent in 2016.

The increases aren’t limited to full-time students, often called day-MBAs. “The executive MBA has grown in the last several decades as companies and workers require more advanced business knowledge to move up, and potential entrepreneurs seek more education toward their goals,” writes the New York Times. “Executive MBA programs are targeted toward workers who want to get an MBA while working. ‘The average E-MBA student is 37 years old with 14 years of work experience and still working’, said Michael Desiderio, executive director of the Executive M.B.A. Council.”[xix]

Emsi, a company that studies market data about education and employment, analyzed job postings for positions that require MBAs. From Nov. 2015 to May 2016, the top 10 companies in postings for product management positions were, in order, Oracle, Amazon, Anthem Insurance, General Electric, Anthem Southeast, Honeywell International, Amazon Corporate, Cisco Systems, Microsoft and Apple. During those six months, the number of postings requiring MBAs increased 146 percent.[xx]

Demand is high enough, in fact, that many companies reimburse some or all of the tuition for their employees to seek an MBA, including online MBAs. Nearly 75 percent of all respondents to the GMAC Corporate Recruiters Survey said that employees with MBAs add value to their companies, and nearly half of their companies reimburse or sponsor employees who are pursuing graduate business degrees.[xxi]

This might be expected from technology or financial companies, such as Apple, Intel, Bank of America and Wells Fargo. But there are some perhaps-unexpected names doing so, too: Starbucks, Disney, Chevron, Gap, Home Depot and UPS among them.[xxii]

Is an MBA my path to a corner office?

Not everyone who pursues an MBA desires a career in upper management, but if you do, there’s no doubt that the degree helps. Nearly 40 percent of the Fortune 100 CEOs[xxiii] and almost a third of the CEOs at companies in the Financial Times 500 have MBA degrees.[xxiv]

Ed Batista, who earned his MBA from Stanford and is an instructor and coach there, often gets asked about the benefits of an MBA. His first answers are not about compensation, though. Rather, he says that an MBA gives you leadership and management skills, adds a credential to your resume that workplaces respect, and places you into a network of alumni that helps you long after you graduate.[xxv]

“Business schools have realized that it’s not sufficient to provide quantitative and analytical training,” Batista writes in the Harvard Business Review, “because within a few years of leaving school (or even immediately upon graduation) their alumni will add value more through their ability to lead and manage others than through their talents as individual contributors.”

This evolution is reflected in the corporate recruiters surveyed by GMAC: 70 percent believe that MBAs translate into skills that give employees versatility in taking on more roles, 67 percent agree that the degree provides “a fast track to upper-level positions,” and 66 percent say that leaders in their own companies tend to have an MBA.[xxvi]

A look at some real-life examples

The key to C-suite (corner-suite) jobs is combining your passion for a company, an MBA skill set and a vision for the future. Here are a few examples of people who have done just that:

CEO: Chief executive officers
- What the job is: The CEO is the top executive in a company, and is responsible for its success. The rest of the top managers report to him or her. CEOs set the vision, build a team of executive leaders and have final oversight of the budget.
- What the salaries can be: Virtually unlimited, up to tens of millions of dollars – it depends on the company. In addition to salary, bonuses, perks, and stock in the company typically are part of the package.
- Real people in the job:
  - Lowell C. McAdam, CEO Verizon Communications – Before joining Verizon in 2000, McAdam worked at Pacific Bell, AirTouch and PrimeCo Personal Communications. He served as Verizon’s executive vice president and chief operating officer before becoming CEO in 2011 and Chairman in 2012.[xxvii] His total compensation was just over $18 million in 2015.[xxviii]
  - Mary Barra, CEO General Motors – Barra began her career at GM in 1980, and earned her MBA in 1990 with a GM fellowship. She served the company in multiple vice-president roles; she has been CEO since 2014 and was elected Chairman of the GM Board of Directors in 2016. Her compensation in 2015 was $28 million.[xxix] [xxx]
  - Richard A. Hayne, CEO Urban Outfitters – Hayne co-founded Urban Outfitters in 1970 and has served as Chairman of the Board and President since 1976.[xxxi] He still performs those duties, and also became the CEO in 2012. [xxxii] Hayne cut his salary to $1 in 2010, but receives benefits and can earn performance bonuses up to $500,000.[xxxiii]

CIO: Chief information officers
- What the job is: CIOs oversee a company’s technology structure, security and growth. Areas of expertise include hardware/software, cloud-sharing, management of data breaches and the process of how the business interacts with customers.
- What the salaries can be: Base salaries start at about $150,000 and go up to about $250,000, according to a Network World analysis of Fortune 500 CIOs.[xxxiv] These executives also receive bonus packages that increase their salaries exponentially.
- Real people in the job:
  - LaVerne H. Council, CIO United States Department of Veterans Affairs, Office of Information and Technology – Council served in executive information capacities for Johnson & Johnson and the March of Dimes; she was named one of the Top 4 CIOS in America in 2010. She became CIO for Veterans Affairs in 2015.[xxxv]
  - John David Thompson, CIO Western Union – Thompson had been CIO at Veritas Software, PeopleSoft, Oracle and Symantec before joining Western Union. He has been CIO there since 2012 and also serves as Executive Vice President of Global Operations and Technology.[xxxvi]
  - Jason D. Molfetas, CIO Amtrak – Molfetas worked in IT at Recall, Westcon Group, Xerox, Pearson Publishing, Pepsi Co., Dannon and Unisys before coming to Amtrak, where he is CIO and Executive Vice President.[xxxvii]

CFO: Chief financial officers
- What the job is: CFOs oversee the company’s financial picture, past, present and future. They are responsible for financial reports, day-to-day operations, investments and capital spending, and forecasting future success.
- What the salaries can be: Again, bonuses and profit-sharing increase the bottom line here; Payscale.com puts the range for CFOs at $67,000-$210,000, with a median of almost $122,000, but executive bonuses can take it into the millions of dollars.[xxxviii]
- Real people in the job:
  - Anthony Noto, CFO Twitter – Noto had experience with Kraft Foods, the National Football League and Goldman Sachs before joining Twitter in 2014. His salary, stock options and other compensation added up to more than $70 million in 2014, making him the highest-paid CFO on Business Insider’s list.[xxxix] [xl]
  - Luca Maestri, CFO Apple – Maestri worked at General Motors for 20 years, serving as CFO for its European and Brazilian divisions. He moved to Nokia Siemans Networks and then Xerox, both in CFO positions, before joining Apple. His total compensation for 2014 was $14 million.[xli]
  - Ruth Porat, CFO Alphabet (Google) – Porat was 27^th on a list of Forbes’ “Power Women” for 2016. She moved to Alphabet after years on the East Coast with Morgan Stanley, Smith Barney and Dean Witter. The move made big headlines with the announcement that Google would pay Porat more than $70 million in total compensation for the move.[xlii]

CMO: Chief marketing officers
- What the job is: CMOs are responsible for creating and operating a company’s marketing strategy, enhancing its image and increasing (if appropriate to the company) sales or fundraising efforts.
- What the salaries can be: The national average for a CMO salary is about $190,000; it ranges up to nearly $350,000, according to Glassdoor.com.[xliii]
- Real people in the job:
  - Marc Mathieu, CMO Samsung Electronics America – Mathieu worked at Coca-Cola in marketing for a dozen years before he started his own company, BeDo, and served at Unilever as Senior Vice President of Global Marketing. He has been Samsung’s CMO since 2015.[xliv]
  - Patrick Adams, CMO Paypal – Before coming to Paypal in 2014, Adams worked in marketing roles at AOL, the SUM Group, Victoria’s Secret Direct and Citibank. He was named one of the 100 Most Innovative CMOs in the world by Hot Topics in 2015.[xlv]
  - Susan Vobejda, CMO Tory Burch – Vobejda was Vice President of Marketing for Yahoo and Head of Global Marketing for Bloomberg before joining Tory Burch as CMO in 2015.[xlvi]

CSO: Chief strategy officers
- What the job is: CSOs act as implementers, carrying out a CEO’s strategies for his or her company. They define, decide and follow through on management decisions and planning processes in order to achieve the company’s goals.
- What the salaries can be: The general baseline range is from just less than $230,000 to $360,000, with the median being right at $280,000, according to Salary.com.[xlvii]
- Real people in the job:
  - Kanuj Malhotra, CSO Barnes & Noble – Before he joined Barnes & Noble, Malhotra served as Vice President and Finance Head for Kaplan Test Prep. He also worked at Sloane Square Partners, the Cendant Marketing Group and Lehman Brothers.[xlviii]
  - Denisha Tate, CSO Boys & Girls Clubs of Greater Milwaukee – Tate has been CSO in Milwaukee since 2015; she served previously as Chief Operations Officer and Vice President of Programs and Operations. She was named a Woman of Influence by the Milwaukee Business Journal in 2013.
  - Nicholas Lehman, CSO TEGNA – Lehman was president of digital for NBC Universal before joining TEGNA. Prior to that, he had worked at Plum TV and IAC, and in several roles at MTV Networks.[xlix]

CPIO: Chief Process Innovation Officers or Chief Innovation Officers
- What the job is: CPIOs are charged with the responsibility of looking at a company’s products and processes and figuring out innovative ways to do them better, including scouting new ideas, building teams and implementing training.
- What the salaries can be: The majority of CPIOs earn between $150,000-$199,999, according to Innovation Leader’s compensation survey.[l]
- Real people in the job:
  - Eduardo Conrado, CIO Motorola Solutions – Conrado has been with Motorola since 1992, and held positions in marketing and IT before working in strategy and innovation. In 2011 he was named B2B Magazine’s Marketer of the Year.[li]
  - Amy Radin, CIO Daily Innovator – Radin has held positions in innovation with E*TRADE Financial Corporation, AXA, Citi and American Express.[lii] Radin was one of America’s first CIOs in her position at Citigroup.[liii]
  - Roy Rosin, CIO Penn Medicine – Rozen works across the Penn system to improve health outcomes, customer service and revenue through innovation. He previously spent 18 years at Intuit, and was the first Vice President for Innovation at that company.[liv]

Other job opportunities for MBAs:

The positions profiled above are those of top executives, people who run entire divisions or companies. But there are plenty of other individual careers in which an MBA enhances your skills and effectiveness while increasing your pay scale.

Management consultants
- What they do: Management consultants work with businesses in strategy, management and operations. Their mission is to help a company accomplish its goals, whether those be in marketing, revenue, management or innovation.
- Career trends: The Bureau of Labor Statistics (BLS) predicts 14 percent growth in this career between 2014-2024, which it classifies as “much faster than average.”[lv]
- How an MBA prepares you for this career: You’ll learn leadership skills, organizational behavior, entrepreneurial management, critical thinking and change management.
Operations managers/directors
- What they do: They are responsible for general business operations inside a company, including personnel, technology, budget matters and customer experience. This job, more than many, changes depending on the size of the company.
- Career trends: S. News & World Report ranks Business Operations Manager as 8^th in Best Business Jobs. BLS predictions are for 7 percent growth between 2014-2024 (as fast as average).[lvi]
- How an MBA prepares you for this career: You’ll study technology and operations management, leadership and organizational behavior, strategy and management.
Business development managers/directors
- What they do: They look toward the future, seeking opportunities to enhance a company’s growth, grow its customer base and develop new markets.
- Career trends: “Business development managers (BDMs) are increasingly in demand as organizations ramp up their efforts to gain market share and expand,” writes Robert Walters, a company that specializes in professional recruitment.[lvii]
- How an MBA prepares you for this career: With courses on strategy, management, designing creative organizations, business marketing, entrepreneurial sales and sales force management.
Investment managers
- What they do: They usually work in financial institutions, making investments for clients – both individuals and businesses – to accomplish those clients’ goals. This includes buying and selling stocks and securities day-to-day.
- Career trends: BLS predictions are for a 7 percent increase between 2014-2024 (as fast as average).[lviii]
- How an MBA prepares you for this career: You’ll learn about corporate financial operations, entrepreneurial finance, private equity, emerging markets, financial management and real estate.
Senior financial analysts
- What they do: Manage teams of financial analysts who evaluate accounting data, financial and economic risks and make recommendations based on a company’s goals; present this information to upper management.
- Career trends: BLS predictions are for a 12 percent increase between 2014-2024 (faster than average).[lix]
- How an MBA prepares you for this career: With study in financial report and control, big data and critical thinking, business analysis and valuation, international economy and corporate accountability.

What steps do I need to take?

First, find the right school. If you’ve decided that you’re interested in pursuing an MBA, the first thing to do is to find the program that’s right for you. Some students choose to go full-time, but many others pursue an online MBA while they continue to work in their careers; if this is the case, you’ll want to investigate the accreditation and quality rankings of the schools that interest you, the flexibility of their programs, and the return on investment (ROI) you’ll get with your degree.

Find an executive mentor: As you pursue your degree, seek a mentoring relationship with someone who can advise you as you grow.

“Finding a mentor is one of the best investments you can make in yourself and your career,” says the World Economic Forum. “Whether you are an entrepreneur or a goal-oriented professional, you need advice from someone who has already been where you are headed.”[lx] A mentor teaches you, looks out for you, inspires you and helps you over the rough spots – and can be a reference and a guide after you earn that MBA.

Learn to network with both peers and executives: Networking can seem intimidating, especially with people who have more education or experience than you. But it’s a learned skill, just like other skills you value in your career.

“When I think about my own career, I owe every job I’ve ever had to networking,” says Thomas Farley, the president of the New York Stock Exchange. Farley suggests four key principles to building a network and maintaining those relationships:[lxi]

Don’t limit yourself to those in your business. Smart, experienced, interesting and powerful people transcend their industries.
Do your homework. Once you’ve met someone, take the time to learn about him or her.
Don’t network for specific outcomes. Networking is not about asking for favors. Rather, the point of it is to create a circle of people around business relationships.
Aim high. Farley acknowledges the intimidation factor, but doesn’t worry about it. “There is very little danger to aiming high,” he writes for Fortune “The worst that can happen is they say ‘no’.”

Be innovative at work: You have the best lab right in your own workplace; use it as a learning experience, not just a job. The Innovation Management website says that innovation “is a word that’s been heard on the lips of more CEOs, read in more broadsheet papers, and detailed in more business magazines” than ever before.[lxii] So take advantage of that momentum. As you work on your MBA, put the leadership, vision and innovation skills you learn into practice whenever you can. When those efforts pay off, the results will enhance your resume down the road.

The MBA: Investing in your career and increasing your net worth

In the last few years, the MBA degree has become the most popular in the United States, for a variety of reasons. Workers with master’s degrees in business are seen as trained leaders that enhance a company’s performance. And earning an MBA has been shown to increase a worker’s value, with higher salaries and greater benefits beginning with graduation and increasing over the lifetime of a career.

Manhattan College is a fully accredited university that offers online MBA programs. The program is flexible; lectures and course materials are available 24/7. The school has earned distinctions on such lists as Money magazine’s Best Colleges (41^st out of 736 in 2015) and U.S. World & News Report’s Best Regional Universities (17^th overall). It was ranked in the top 10 universities that increase mid-career earnings by Brookings in the 2015 report Beyond College Rankings,[lxiii] and was ranked 15^th out of 900 colleges in the 2014 College Return on Investment Report.[lxiv]

To receive more information on Manhattan College’s online MBA program, you can explore its website, fill out an information request or download a brochure.

[i] Bureau of Labor Statistics (BLS), Should I Get a Master’s Degree?, 2015

[ii] National Center for Education Statistics, Digest of Education Statistics, Bachelor’s, Master’s and Doctor’s Degrees Conferred by Post-Secondary institutions, by Field of Study, 1970-71 through 2011-12.

[iii] BLS, Earnings and unemployment rates by educational attainment, 2015

[iv] Urban Institute, Higher Education Earnings Premium: Value, Variation and Trends, 2014

[v] Fortune magazine, Why the MBA has become the Most Popular Master’s Degree in the U.S., 2014

[vi] Graduate Management Admission Council (GMAC), The Value of the MBA in 3D, Global Management Education Graduate Survey, 2014

[vii] GMAC, The Value of the MBA in 3D, Corporate Recruiters Survey, 2014

[viii] GMAC, The Value of the MBA in 3D, Alumni Perspective Survey, 2014

[ix] Fortune magazine, Congrats, MBA Grads! You’re Getting a $45,000 Raise, 2015

[x] Graduation Management Admission Council, Corporate Recruiters Survey Report, 2016

[xi] Fortune magazine, The Job Market for MBAs is the Best Since 2010, 2016

[xii] Poets and Quants, Why the MBA is More Valuable Than Ever, 2016

[xiii] U.S. News & World Report, Discover 6 Hot Jobs for MBA Graduates, 2016

[xiv] GMAC Corporate Recruiters Survey Report, 2016