Average MBA starting salary in USA, India | Compensation trends

Earlier we wrote about MBA Jobs in USA, India and other countries. Now we move on to the part that most MBA students are most interested in – post MBA salaries, pay-scales and compensation packages. The QS TopMBA report on jobs and salaries reveals some intriguing facts and trends about MBA salary in USA, India and other countries.

Average MBA Starting Salaries and Compensation Packages

Region Average MBA salary (annual)
North America $109,000
Western Europe $106,000
Asia- Pacific $85,000
Middle East $76,400
Latin America $72,000
Central Europe $72,000

The basic trend so far has been that North America and Europe have been lagging behind the emerging markets on the MBA salary growth parameter. However, in absolute terms the salaries offered in these regions are still high.

The icing on the cake has come in the form of bonuses (almost 20% of the overall compensation). This includes sign-on bonuses (helps take off some of the education loan pressures) as well as performance related end-of-the-year bonuses.

The average payback period has been between 2 to 5 years.

Consulting salaries in USA and Europe have been in the $110,000 to $130,000 range.

In contrast, the investment banking salary range has been much wider, from $90,000 to $200,000

If you thought that MBA Salaries in USA were the highest, you’d be wrong. Australia ($133K) tops the charts, with Switzerland ($130K), Denmark ($121K), UK ($106K) and France ($101K) making up the next 4. USA MBA average salaries ($98K) are the 6th highest. But that’s not so bad, as the MBA is still valued the most in America. You’ll get the widest range of MBA job offers here. Another aspect to consider is that there were lesser respondents from the other countries (so easier to skew the numbers).

Among the 20 major markets, MBA salaries in India are the lowest, even after excluding the low (under $30,000) salaries offered by Indian companies and MNCs that recruit MBA graduates with low/no experience.
 

Average MBA Salary in USA & Western Europe

Industry Sector Average Salary Average Bonus Total
Aerospace / Defence $76K $3K $79K
Construction / Property $97K $8K $105K
Consulting / Professional Services $89K $15K $104K
Electronics / High Technology $93K $12K $104K
Energy Sector $97K $13K $110K
FMCG Sector $94K $9K $104K
Financial Services / Banking $95K $12K $107K
IT / Computer Services $93K $14K $106K
Legal Services $68K n/a $68K
Manufacturing / Engineering $83K $13K $96K
Media / Entertainment $84K $16K $100K
Mining / Metals $140K $52K $191K
Healthcare / Pharmaceuticals $100K $23K $123K
Public Sector / Govt. / Nonprofit $82K $8K $90K
Recruitment / HR services $87K $9K $96K
Retail industry $80K $10K $90K
Telecom industry $94K $7K $101K
Transportation / Distribution $85K $9K $95K
Travel / Leisure / Hospitality $79K $4K $83K
Utilities sector $82K $7K $89K
Other industries $90K $9K $99K

Source: QS TopMBA.com Jobs & Salary Trends Report 2013/14 (www.topmba.com)
 
The other trend over the last decade has been in the area of salary equalisation. This means that the difference in MBA salaries across geographies is reducing i.e. you could work for an MNC in India (hoping the Indian talent with international credentials and perspectives will help to increase their domestic footprint) and still get a significantly higher post MBA salary compared to what the local employers might offer.

However, the number of MNC jobs in home countries that pay very high salaries (closer to the $100,000 average in USA) is still quite small. [Read this related post: Highest paying jobs in India]

The reason is that there’s an abundant supply of local MBAs (from lower tier institutions) who are willing to work for a fraction of the salary. So it’s difficult for many MNCs to justify paying a premium to the top international B-school grads.

The key message from recruiters to new MBA graduates is to avoid getting too obsessed with the post MBA salary and look at establishing credibility within the organisation first, gaining new skills and build a long term career plan.

Apart from these short term salaries, read this article on how much you can expect to earn in the long run: Average MBA salaries after 10 – 20 years for USA and Canadian business school grads


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Sameer Kamat //
Sameer Kamat

Founder of MBA Crystal Ball. Author of Beyond The MBA Hype & Business Doctors. Here’s more about me. Connect with me on Google+ | Twitter | Facebook | Linkedin

31 Comments

  1. Abhi Roy says:

    Many MBA students are forced to do job on low salary because to gain experience. Even student of top MBA colleges are not getting highly package after finishing his or her masters in business administration. Sir could you please share your views about this situation.
    [Moderator Edit: Spammy links removed]

  2. Varun says:

    Agree with you, Sameer, that it’s crucial to build and gain new skills, considering your long term career plans than your immediate post MBA salary figures.

    The point to consider by Indian students looking forward for an MBA abroad is where they want to be down the line!

    What do you think Sameer? I would consider these points:

    Would language be a barrier while choosing region?

    Which region would be more sensible if I were to return back to India and work for or partner with my contacts that I made during MBA?

    Where can I make better contacts?

  3. Sameer Kamat says:

    @Varun: Language will be a serious barrier if you are considering front-office and client interaction roles. Even otherwise, it helps to know the basics so you can fit into the culture and be accepted by the local colleagues.

    If you intend to come back to India, there are no issues. All your classmates would speak English. So you can continue to communicate with them after getting back.

    Choose the region where you see yourself doing business in the future, from your Indian office.

  4. Abhinav says:

    Hi Sameer,

    I am an ISB admit for class of 2014-2015 with 2.8 years of experience as a software engineer with Amazon.

    Please help me know of the placements in terms of roles and compensation.

    Thanks,
    Abhinav

  5. Sameer Kamat says:

    Abhinav: The ISB website should have the careers and compensation report. It has quite a bit of detail in it that you might find useful.

  6. Rohit kushwah says:

    I’m Electronics and comm. engineer have more than 3 year of experience.Now want go for MBA in operation (supply chain) from the USA or Canada.
    will you please suggest any other program which is more beneficial for me.

  7. Mohit says:

    Hi Sameer,

    Your post was quite informative.

    I am a B.Tech with 7+ yrs of exp in IT (non-developer role, mainly consulting in professional services and support) and earning a handsome salary almost equal to ISB’s 2014 batch average salary as mentioned on their website. Always wanted to do an MBA, but never got chance to prepare for GMAT. Also, I’m earning good so never felt the need either.

    Now, I feel like taking GMAT and getting a successful MBA admit next year, so that will increase my experience by 15-18months plus the raise in salary by the time I join a B-school.

    Unfortunately, I have a mental block that my today’s earning is just perfect as compared to my peers from college and elsewhere, Then how would an MBA degree from ISB in India or abroad (excluding Europe) will help in monetary terms, primarily concerned about the ROI. Please share your views

    Somewhere down the line I understand, MBA is to be thought as a long term career plan and not for immediate returns. Need your inputs to clear my mental block, also, considering my current work profile (Mainly Individual Contributor) if you think it won’t be wise for me to pursue a regular MBA instead should look out for PT program alongside job.

    Another question I’d like to raise is, ISB claims that their outgoing salaries are twice the incoming figure. Is this valid for someone already coming with 15-20lpa bracket? I doubt, but need your expert opinion.

    P.S Sorry for keeping it long.

    Regards

  8. Sameer Kamat says:

    @Rohit: MIT, Wharton, Stanford, Kellogg are among the best for supply chain / operations.

    @Mohit: After 8+ years of experience, the monetary upside (as that’s what you’ve asked about) of schools like ISB will not be as high as those who come in with half your experience. So, don’t expect to double your salary.

  9. Ajay Kumar says:

    Hi Sameer,
    A big thank you for providing this information..
    I have done B.tech(I.T.) in 2012, then after a year in May 2013 I start doing job. Then in 2014, qualified a government exam for job and is doing the same, but I always wanted to pursue MBA, so I wanted to know that whether Is it the right time to go for GMAT ?
    I’m an average student 70% in all 10th, 12th and in graduation and no much of extra curricular activities. I have also taken CAT but always getting around 85%tile (not qualified), but always want to do MBA from HBS or GSB. So please tell the score that I should achieve in order to get admitted in HBS or Standford with maximum scholarship (since I’m not financially good so it is the deciding factor for me). Please guide me…
    Thanks….

  10. Sameer Kamat says:

    @Ajay: It’s a good time to start working on GMAT, but with the bschools you’ve listed, you’d be setting impractical goals for yourself.

    It’s not impossible but you’d need a profile like this to – get into Harvard and Stanford with a scholarship

  11. kusum says:

    Hi sameer….
    I have done Bsc nursing… And has 2yrs experience as a staff nurse in one of the reputed hospitals. Am interested in doing mba in hospital administration…but I have a diloma to do it in abroad or in india. As my aim is to settle in abroad.Which wil be a finest option for me with a weak financial background

  12. kamal says:

    my name is kamal patwa from mumbai india and i have exp is sales & financial market alomost 7 years please suggest me mba program.

  13. Saranraj K says:

    Saran
    I am Mechanical engineer with four years experience in manufacturing.To decide on my career,suggest me to go for MS,ME,MBA or grow with my experience .

  14. Puneet says:

    Hi Sameer

    I am working in a MNC and has almost 4 years of experience. I am planning go for IELTS and get an admission in MBA In USA . So after completing MBA and joining a MNC in India will b worth and will i get a good package?
    Please guide

  15. Carrita says:

    Hi Sameer Sir, I’m carrita and I’m pursuing third year of BBA . I want to do MBA in HR or Marketing from USA or CANADA .I will be giving my gmat exams in December.
    What would you suggest should I go abroad for MBA or study in INDIA? Do best b-schools accept fresh graduates without work experience?

    • Vijay Godara says:

      Hi Carrita…
      I’m Vijay. I’m pursuing my BBA final year & also I’m Pursuing my internship from one of the reputed company of india in HRM.
      So i would like to go aboard for further study (MBA in HR)..
      If you have any information regarding to this then can you suggest me please..!!

  16. Bapu says:

    Hello sir, I m Bapu I have done BE Mechanical in may 2015, and started work in one manufacturing company but I always want to MBA in top business school in US or UK plz give me some information about that

  17. Pjain says:

    Hi Sameer

    I am working as a Field Service engineer in a MNC in Life Science research / Healthcare Sector. Exp : <2 Yrs. Kindly suggest me for MBA program that will be good for my growth,
    I am planning to pursue it in 2017. So by that time by exp will be of 3+ yrs

  18. ashfaq says:

    Hello Sameer,
    I am a fresh graduate in electronics engineering. Currently working as an IT professional in one of the leading MNC with a nominal package. I would like to do my MBA in one of the top B schools in NORTH AMERICA .So would you suggest me the institutional GMAT cut off scores and the respective placement reports, And also the average salary drawn from that particular B school.
    Thanks in Advance

  19. suhasini says:

    hello sir
    iam doing first year engineering. i want study MBA abroad. please may i know the exams to be attended and wer to go for coaching in next 3 years
    thank you

  20. suhasini rajendran says:

    iam doing first year engineering. i want study MBA abroad. please may i know the exams to be attended and wer to go for coaching in next 3 years
    thank you

  21. Aeronica says:

    Hey sameer .. I am an electronics and communication engineer and have an experienced of 1.5 yrs … now thinking to do mba from university of pensulvenia .. is it good. Plz share ur views .. what salary I can expect after completion of my degree in supply chain or it

  22. Krishna says:

    I am inter C.A + commerce graduate. I want to study MBA in abroad. I don’t want to go for MBA in finance or marketing. Can you please suggest the course and university?

  23. Laks says:

    Hi,
    I’ve gotten into ISB this year. I’m an engineer with 4 years experience in the embedded system domain (not earning in double digits yet). Was just planning to take up MBA for career advancement and not out of any special interest in the field. But now concerned about the high education cost. Are the packages and job profiles offered too little or too stressful to be of much use?
    (Basically worried about ROI and quality of life post MBA)
    Please let me know
    Thanks!

  24. Amit Joshi says:

    Hi,
    I completed my civil engineering diploma. I have 11 year experience in Management and engineering sector, but i want job in USA, but i do’t want a job in civil engineering I want the job in management sector please suggest me for package and management scope in USA…

  25. sowrav bora says:

    hi,
    i am completed b.a. in poltical science major this year. i’m form assam. i went 2 do mba.. can you please suggest me the cource and univercity is better for me…(specially in assam)

  26. Boby sharma says:

    Hello sir!!! I m Boby Sharma and I HV just completed my graduation from commerce, so now I want to go for MBA but I m little confuse abt doing MBA in India or in abroad ….so plzzz help me to find out the best for me…

  27. Ravi says:

    Hello sir, i am quite confused with the salary thing… I just want to know that these are annual salary or monthly?

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