Is an MBA Still Paying Off? Surfacing Useful Market Data to Inform Strategy

Earlier this fall, my colleagues and I were selected to present a session at this year’s annual meeting of the Executive MBA Council. After past presentations of business-only findings from our national graduate studies, we wanted to add something even more helpful: employer market insights.

As institutions increasingly require that program additions, updates, or changes be informed by market data, the go-to source for the employer perspective is the U.S. Labor Department’s Bureau of Labor Statistics (BLS). BLS uses an ingenious “Crosswalk” jointly developed with the U.S. Department of Education to link every program classification (CIP) with every occupational classification (SOC). This allows researchers to relatively quickly gain a top-line understanding of the occupational environment for pretty much any program.

The greatest drawback of the BLS data is that it cannot be filtered. You are reliant on the program and occupational linkages that have been developed. For programs with clear end-point careers (nursing, etc.) this system works pretty well. But for programs that lead to a myriad of careers (like business administration), the data are of limited use at best. And yet they remain the go-to source.

Below we present the data profiling the occupational environment in careers associated with business administration (CIP). There are more than 20 careers (SOCs) that have been formally linked to the program area. The Lightcast^TM data platform uses other Labor Department data on degree attainment by occupation to estimate (in this case) the master’s level occupational market. But this is the extent that we can portray the master’s market.

Standard Occupational Classifications Linked to Master’s Level Business Administration CIP

So these data help us understand that nationwide, there are about 3.3 million total jobs, and more than 357,000 openings, 10-year growth is projected to be 7.2 percent. What we don’t know is the extent to which these jobs really do require or prefer an MBA, how many of these estimated openings require no experience (or a lot of experience), etc. To illuminate questions like these (and others associated with specialty programs like an EMBA) you need more detail.

Unique Job Postings are that source, and the Lightcast platform is our resource. For the purposes of our presentation at EMBAC, I began by selecting the 21 occupations that have been linked to the degree. I then ensured that all postings required a master’s (these data comprise the first column in the charts below) and input key words that would ensure all postings specifically referenced “MBA” or associated terms (these data comprise the data in the second columns). The final step was to stipulate that all postings in the data set required at least 7 years professional experience (this comprises the data in the fourth columns below). In order to understand the differences between all business occupations that require a master’s and those that specifically reference an “MBA” I also applied the 7+ years experience to the original data set (these data comprise the third columns below).

What is the state of the job market that graduates of executive MBA (and MBA and other business master’s) will confront upon graduation?

Total unique job postings help us understand these dynamics. The first thing we are able to understand in this customized data set is the universe of unique job postings (“unique” implies Lightcast’s application of a process that seeks to ensure that different listings for the same job are removed) over the course of a 12-month period (September 2022 to August 2023). While the total number of unique job postings for experienced MBA holders is only a sliver of the total business master’s positions (814,461), and less than half of all MBA jobs (210,150), there were more than 76,000 unique jobs posted that sought an experienced MBA-holder (7 or more years professional experience – the closest we can get to an EMBAC graduate).

What is the competitive environment for jobs among employers?

Lightcast’s data on the total competing employers helps us understand the level of competiveness: What is the More than 60,000 different employers were competing for business master’s graduates in the 12-month period, while 22,219 of them were competing for MBA holders and nearly 10,000 of them were competing for experienced MBA holders. Interestingly, there were more employers seeking experienced MBA holders than those that were seeking an more general master’s level business graduate.

How competitive are starting salaries?

Lightcast’s data on advertised starting salaries help us understand one of the most important factors for today’s students: what the financial return on investment is likely to be from their studies. While the median earnings data available from BLS provides a career-long overview, it does not differentiate by degree level of employee. Job postings data as culled in this data set allow us to understand – in near real-time – the salaries that the multitude of competing employers are having to offer to qualified applicants. The median starting salaries for ALL master’s level jobs (not just business) across the U.S. in the 12-month period was $96,200, according to Lightcast. The starting salaries for all business master’s jobs beat this by nearly $20,000. MBA jobs surpassed this by nearly $40,000, and experienced MBA jobs surpassed this by more than $60,000. Business education clearly “pays off”, but having an MBA continues to be among the best investments in higher education.

Are starting salaries increasing or decreasing as the job market fluctuates?

Lightcast’s 12-month starting salary change data helps us understand how the economy is affecting salaries. Imagine posting on your program page not only that median starting salaries are $XXX (using the data above), but that they have increased by YY% in the last year. This is powerful stuff for a generation of students who view their higher education as a commodity more than any preceding generation. Interestingly, while experienced MBA holders had by far the highest starting salaries, they did not grow over the 12-month period as much as either all business master’s jobs or all MBA jobs. There are likely a myriad of factors at play here, but at least some of this may be the job churn over the last two years was putting a lot of “supply” into the market as the post-pandemic high salaries lured increasing numbers of experienced employees to test the waters and change jobs.

Who is hiring?

All the of statistics presented above provide excellent “copy” to add to your program pages. Student focus on the ROI of their higher education have moved related career and job outcomes data from the periphery to the center of what program pages ought to include. You can post national statistics as a first step and this will help move many students forward. But imagine if you could get these same data for your region? Imagine that you could get a list of the specific employers that are most frequently seeking master’s level business graduates, or MBA holders, or experienced MBA holders? The screenshot below presents Lightcast data on the 10 employers across the nation most frequently posting job listings that require or prefer seven or more year’s professional experience.

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