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MBA degrees are back in vogue

Salaries and signing bonuses of fresh graduates took a double-digit jump in 2005 to a record average $106,000 and signaled an end to the "perfect storm" of sour news this decade that included the dot-com bust, the September 11 terrorist attacks and a subsequent recession, said Dave Wilson, president of the Graduate Management Admissions Council (GMAC) that oversees the test for aspiring graduate students in business. Corporate recruiters had disappeared from campuses. But, Wilson reports, "The MBA is back as the currency of intellectual capital."

The $106,000 salary and signing bonus was up 13.5 percent from 2004, according to a GMAC survey of 5,829 2005 graduates. Salary alone increased to $88,600, surpassing the previous high of $85,400 set in 2001. The 2005 salary still trails 2001 by about $4,000 when adjusted for inflation, but the inflation-adjusted record will likely be broken this year.

Consulting firms and investment banks, the best-paying employers of freshly minted MBAs, had been slashing jobs. "They're back and hiring aggressively," says Nunzio Quacquarelli, the London-based director of the QS World MBA Tour that recruits students to 350 business schools in 56 cities worldwide.

The average bonus paid to a 2005 MBA graduate by investment banks was $40,000, Quacquarelli says.

Other forces are behind the rising compensation. The health care industry craves MBAs to help manage spiraling costs, and schools such as Boston University offer an MBA for those looking for careers ranging from hospital administration to biotech.

Technology hiring showed signs of life last year and is building steam in 2006, Quacquarelli says. Even the outsourcing of jobs to places such as India is driving demand for MBAs. The Labor Department estimates the outsourcing industry will need 2,000 senior executives this year, up from 100 in 2000. By 2012, it will need 9,500.

(www.spokesmanreview.com)

 
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