Business fat cats not so fat
By Paolo Zinatelli
A recently released study suggests that a Masters Business Administration degree does not result in an average starting salary higher than that of other Masters graduates.
Merrilyn Earl, a consultant for Mercer Human Resource Consulting, the company that conducted the study, said the annual survey questioned 135 organizations about starting salaries.
The survey asked employers the starting salaries for graduates with Masters of Science, MBA, Masters of Arts and PhD degrees, Earl said.
Across all industries, the average starting salary for an MBA graduate was $50,400 she said.
For MSc and MA graduates, it was $50,100 and $48,600 respectively, she added, pointing out the MBA average was not much higher.
"The key message we were trying to get across is that when you're thinking about grad starting salaries, it's where you apply [your degree]," Earl said.
The survey found that MBA graduates in the service sector had a starting average salary of $44,000, yet starting salary in the pharmaceutical sector is $63,400, Earl explained.
"I was very shocked, because it doesn't match the reality," said Ed Pearce, director of marketing and communications for the Richard Ivey School of Business.
According to Pearce, the average starting salary for an Ivey MBA graduate is $82,000.
"I would suspect that the same thing is true for the other big MBA programs [like Queen's University and the University of Toronto]," he added.
"There's probably some truth to the statement," said Alok Mohindra, a second-year MBA student and director of UWO Networking, speaking on behalf of the MBA Student Association.
"That being said, there is a wider variation in MBA salaries," Mohindra added.
"Any MBA [school] that has a starting salary around $50,000 would not be charging $20,000 a year [in tuition]. They wouldn't have any students," Mohindra said.
"It sort of goes to show that the whole idea of basing tuition fees on perspective salaries is not the way to go," said Jesse Greener, a graduate in physics and speaker for the Society of Graduates Students, concerning the study's results.
In deregulated programs, like MBA, tuition fees should be reduced, Greener said.