3 Pros and Cons of doing an MBA and how it impacts Earning Potential
An Master of Business Administration or an MBA, is a graduate-level degree that can be completed in as little as two years, though most students take closer to three years to finish. The degree is designed to prepare students for executive-level positions in business and organizations. There are three main types of MBA programs: full-time, part-time, and online, and each has its own benefits and drawbacks. There are also executive MBA programs, though to keep it simple, it's not considered as part of the pros and cons.
The cost of an MBA is significant, but so is the potential return on investment (ROI). Here are three pros and three cons of getting an MBA, including how an MBA can impact your salary.
Pro #1:Heightened Earning Potential
The most significant benefit of getting an MBA is the potential for increased earnings. An MBA can open doors to better job opportunities and higher paying positions. On average, MBA graduates earn 20% more than those with just a bachelor’s degree. According to a 2023 survey by Coursera, the median base salary for MBA graduates is $115,000. That’s nearly $50,000 higher than workers with a bachelor’s degree. The report found that MBA graduates also receive nearly $30,000 more in signing bonuses and nearly $20,000 more in annual bonuses than workers with a bachelor’s degree.
Pro #2:A Wider Network
Another significant benefit of an MBA is the professional network you will develop. The individuals you meet while earning your degree can be valuable connections throughout your career. Many MBA programs also offer opportunities to intern with top companies, providing even more connections to industry leaders.
Pro #3:Enhanced Job Security
In today’s job market, many workers are looking for ways to make themselves more valuable to their employers and increase job security. An MBA can do both. The skills and knowledge you gain can help you contribute more to your organization. Many employers view an MBA as proof that you have the skills and knowledge to be successful in a management role. An MBA can also help you pivot into a new career. For example, if you’re looking to make a switch from marketing to finance, an MBA can give you the credentials you need to be taken seriously for finance jobs.
Whilst, there are obvious pros to having an MBA, there are cons as well. Some of these cons can be mitigated through proper planning.
Con #1:The Cost
The cost of an MBA can range from $30,000 to $225,000, depending on the school you attend and whether you pursue a full-time or part-time program. And that’s not including the opportunity cost of forgoing two years of full-time work (and salary). If you plan to finance your MBA with student loans, you could end up paying back hundreds of thousands of dollars over the course of your career.
Con #2:The Time Commitment
Another significant downside of an MBA is the time commitment. An MBA program typically takes two years to complete, though some programs can be done in as little as one year. That means you’ll likely have to take a hiatus from your career to focus on your studies. If you have family or other obligations, pursuing an MBA can be a major time commitment.
Con #3: An MBA is no guarantee of success
Despite the potential benefits of an MBA, the program is no guarantee of success. In fact, there’s no guarantee that you’ll land a job after graduation or that you’ll make more money than you would have without an MBA. The outcome of your MBA program will ultimately depend on your own merits and hard work.
Overall, an MBA can be a great way to boost your career and earnings potential. However, it’s important to weigh the pros and cons carefully before making the decision to enroll in an MBA program.
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