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MBAs Now Even More Worthless

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  • MBAs Now Even More Worthless

    Hard to believe, I know.

    If you want proof that the immediate rewards of the MBA degree have declined, look no further than the past ten years. From 2001 to 2010, the costs of getting the degree have significantly outpaced starting pay at every one of the top 20 U.S. business schools.

    An analysis by Poets&Quants of school estimates of the cost of attending a two-year program and median starting salaries of new MBA grads show that large amounts of value have eroded from certain programs. The analysis did not take into account the fellowship grants that would reduce the costs of getting a degree.

    Whether this is merely a reflection of the overall economy which has led to widespread layoffs and stalled salaries among many white collar employees or a sign that the cachet of an MBA has declined is up in the air. But there’s no question that MBA candidates working toward the degree today will take a longer time to achieve a return on their investment than their predecessors did ten years ago.

    Which schools saw the greatest depletion of value in the past decade?

    The costs of attending Carnegie Mellon University’s Tepper School rose 12.8 times faster than its MBA starting salaries–more than any other top 20 school–while the University of Texas’ McCombs School of Business saw the cost of attending its MBA program jump 11.7 times its median salaries for graduates.

    Schools that held the most value

    The two at the top of the list: Stanford Graduate School of Business increased its budget recommendations to students by only 1.6 times its salary increases, and the costs of getting a Chicago Booth MBA rose only 2.2 times the salary of a Booth graduate. They were followed by MIT Sloan and New York University’s Stern School of Business, both of which saw costs rise 2.4 times median salary increases.

    Other findings:

    the top ten schools did significantly better than the bottom ten in the top 20.
    In the top ten schools, the costs of the degree rose three times the median salaries.
    But in the bottom ten of the top 20 schools, the costs increased 6.5 times pay.
    The single biggest increase in the cost of an MBA over the past ten years occurred at Texas-Austin where the recommended two-year budget for a student surged 140% to $127,444 from $53,034. Meantime, median base salaries went up only 12% to $95,000 for the Class of 2010 from $85,000 for the Class of 2001.

    The smallest increase in base salary was at Emory University’s Goizueta School, where pay increased by only 6% in the past ten years to $90,000 from $85,000. The cost of getting a Goizueta degree, however, jumped by 45% to $130,280 from $89,920.

    Columbia Business School stands out–in a bad way

    Among the elite private schools, the greatest deterioration in the value equation was at Columbia Business School. The costs of getting the degree rose 8.9 times faster than the starting salaries in the past ten years. The recommended two-year budget at Columbia jumped 71% to $169,502 from $99,388, while median base pay increased by only 8% to $100,000 in 2010 from $93,000 in 2001.

    School 2010 Median Pay 2001 Median Pay %
    Increase

    2010
    Two-Year

    Budget

    2001
    Two-Year

    Budget

    %
    Increase

    Harvard $110,000 $100,000 10% $158,000 $109,600 31%
    Stanford $120,000 $100,000 20% $168,812 $128,000 32%
    Wharton $110,000 $95,000 16% $168,000 $119,456 41%
    Chicago $102,000 $85,000 20% $154,060 $107,722 43%
    Kellogg $105,000 $90,000 17% $156,990 $105,066 49%
    Columbia $100,000 $93,000 8% $169,502 $99,388 71%
    Dartmouth $105,000 $95,750 10% $159,900 $95,750 67%
    MIT Sloan $110,000 $92,500 19% $160,378 $110,620 45%
    Berkeley $110,000 $90,000 22% $144,746 $76,320 90%
    Duke $100,000 $85,000 18% $137,746 $82,948 66%
    Virginia $100,000 $85,000 18% $142,000 $84,000 69%
    NYU $100,000 $85,000 18% $157,622 $109,234 44%
    Michigan $100,000 $90,000 11% $141,210 $91,100 55%
    Yale $100,000 $85,000 18% $151,982 NA NA
    Cornell $96,000 $87,500 10% $142,404 $86,610 64%
    Carnegie-Mellon $95,000 $88,000 8% $149,400 $74,000 102%
    UCLA $100,000 $85,000 18% $147,278 $62,664 135%
    UNC $95,000 $85,000 12% $136,860 $82,650 66%
    Emory $90,000 $85,000 6% $130,280 $89,920 45%
    Texas $95,000 $85,000 12% $127,144 $53,034 140%
    Source: School reports to BusinessWeek. For public institutions, out-of-state recommended budgets were used.



    I hear some businesses are now firing their MBAs and hiring cheaper BAs and BSs from top schools. Could this be the boost business needs?
    “As a lifelong member of the Columbia Business School community, I adhere to the principles of truth, integrity, and respect. I will not lie, cheat, steal, or tolerate those who do.”
    "Capitalism ho!"

  • #2
    "more worthless" more goodless english.
    I drank beer. I like beer. I still like beer. ... Do you like beer Senator?
    - Justice Brett Kavanaugh

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    • #3
      I knew I should have written "Worthlesser."
      “As a lifelong member of the Columbia Business School community, I adhere to the principles of truth, integrity, and respect. I will not lie, cheat, steal, or tolerate those who do.”
      "Capitalism ho!"

      Comment


      • #4
        There's nothing syntactically wrong with "more worthless".

        Once more, kiddy proves himself the most worthless poster.
        12-17-10 Mohamed Bouazizi NEVER FORGET
        Stadtluft Macht Frei
        Killing it is the new killing it
        Ultima Ratio Regum

        Comment


        • #5
          Originally posted by KrazyHorse View Post
          There's nothing syntactically wrong with "more worthless".

          Once more, kiddy proves himself the most worthless poster.
          no, that honour is still bestowed on you

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          • #6
            har har har. where do you come up with those witty repartes?
            12-17-10 Mohamed Bouazizi NEVER FORGET
            Stadtluft Macht Frei
            Killing it is the new killing it
            Ultima Ratio Regum

            Comment


            • #7
              MBAs screwed GM up by not knowing jack **** about building a better car and instead focusing on cutting costs which resulted in crap cars no one wanted to buy. I know several engineers who refuse to hire someone simply because they're MBAs. Sure, there is a roll for MBAs but they're mostly generalists and the schools keep pushing the retarded lie that a good MBA can run any company no matter what they do when in fact most of them don't know jack about the specifics of the business and so don't know good trade offs vs bad trade offs.
              Try http://wordforge.net/index.php for discussion and debate.

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              • #8
                sure didn´t learn it from you - given your limited skills in this regard you´d be a very mediocre teacher

                do tell us, what kind of satisfaction do you get out of calling somebody worthless?

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                • #9
                  on-topic, it always appeared to me that the only value in an MBA is the people that you get to know

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                  • #10
                    Who are you talking to?
                    Try http://wordforge.net/index.php for discussion and debate.

                    Comment


                    • #11
                      Anyone willing to listen. It's not that business degrees are worthless, they're broad-based. It's possible to narrow your focus, if that's your desire. You still have business, but with a focus.
                      Life is not measured by the number of breaths you take, but by the moments that take your breath away.
                      "Hating America is something best left to Mobius. He is an expert Yank hater.
                      He also hates Texans and Australians, he does diversify." ~ Braindead

                      Comment


                      • #12
                        I'm not sure what's more depressingly worthless, the MBAs issued at Tepper here at CMU or my own program, Information Systems. The good news is I am basically turning my "Information Systems" degree (read: CS lite + business lite) into just a plain old CS degree since there aren't any ****ing course requirements.

                        As for why I am in such a terrible program, two reasons:
                        1. It wasn't actually my first choice,
                        2. I thought it would be something along the lines of systems administration, and it turns out it's a load of stupid crap.
                        If there is no sound in space, how come you can hear the lasers?
                        ){ :|:& };:

                        Comment


                        • #13
                          What exactly do people teach in business school anyway? I can't figure that one out.
                          If there is no sound in space, how come you can hear the lasers?
                          ){ :|:& };:

                          Comment


                          • #14
                            I really can't see a problem. They have to hire high quality teachers so of course the price goes up
                            With or without religion, you would have good people doing good things and evil people doing evil things. But for good people to do evil things, that takes religion.

                            Steven Weinberg

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                            • #15
                              the dirty little secret of universities is that teaching is a cash cow, rather than a service to the public. why did you think there´s more than 3 people in a class?

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