Is an MBA Worth It? 2024 Guide

If you are looking to advance your career in business, pursuing a Master of Business Administration (MBA) degree is typically seen as a worthy investment. Often, the long-term benefits of earning the degree—including salary gains and career advancement opportunities—outweigh the degree program's immediate financial and time costs.

Along with the potential financial benefits, many corporate recruiters consider an MBA degree an asset because of the job skills degree holders commonly possess. Additionally, participating in an MBA program can set you up with lucrative networking opportunities and business contacts via your school’s career placement programs, your classmates, and your program faculty.

That being said, some factors make some MBA programs more worth the investment than others. Here, we’ll break down how you can conduct a cost/benefit analysis to determine whether getting your MBA can offer the return on investment you’re looking for.

Benefits of earning an MBA

Having an MBA can be a respectable credential to add to your resume, signaling a high-value skill set that many hiring managers look for in employees. Additionally, MBA programs offer unique career and networking resources reserved for students and space for building beneficial long-term relationships.

Read more: Why Get an MBA? 6 Reasons to Consider an Advanced Business Degree

Salary and job outlook

Earning your MBA can qualify you for higher salaries and more job opportunities. According to a 2022 survey of corporate recruiters, the Graduate Management Admissions Council (GMAC) projected that MBA graduates working at US companies would earn a median annual salary of $115,000 in 2022. Non-MBA degree holders were projected to earn much less: $75,000 for bachelor’s degree holders [1].

Additionally, hiring projections remain strong. Ninety-four percent of US-based recruiters surveyed expected to hire MBA graduates in 2022, and 97 percent of US-based recruiters anticipate their hiring demand for business school graduates to increase or remain stable over the next five years [1]. Another GMAC report found that 86 percent of 2022 MBA graduates were employed upon graduation, a 6 percent increase from the 2021 class [2].

Your anticipated post-MBA starting salary can fluctuate based on factors such as industry, location, years of experience, and school attended. Learn more about MBA salaries to better understand your earning potential.

In-demand skills

Because of the rigorous coursework typical of many MBA programs, employers often recognize a common set of transferable skills that graduates acquire through their higher education experience.

According to GMAC, the top valued skills of MBA graduates in the US include [1]:

• Interpersonal skills

• Motivation and leadership

• Strategy and innovation

• Decision-making

• Strategic and systems skills

To many employers, an MBA degree validates that you possess these desired skills and are prepared to use these skills to succeed in higher-level business positions.

Career resources and networking opportunities

MBA faculty and staff are invested in their students' success. Your success will hopefully help attract future students with similar potential to succeed, whether that’s through positive employment reports or reflected in their program ranking. As such, many programs incorporate career resources and networking opportunities into their offerings.

These services, such as on-campus recruitment fairs or executive coaching, can help lead to more lucrative career options. Similarly, MBA programs with strong alumni networks may offer direct points of contact within companies hiring around the world.

According to a 2022 GMAC survey, 76 percent of graduate business school alumni felt that their program helped them develop their professional network, and 68 percent agreed that their program offered opportunities to accelerate their career advancement [3].

Relationship building

There’s also value in the relationships you can build while pursuing your MBA. Seventy percent of alumni felt that their program prepared them to work in culturally diverse organizations [3].

Many MBA admissions offices seek to populate incoming classes with a diverse group of students who can offer a range of business perspectives. To capture that co-learning opportunity, many programs will incorporate group projects into the curriculum alongside discussion-based classes, and some students may also choose to engage in study groups or extracurricular activities.

Typical MBA degree cost

Alongside the benefits of getting an MBA degree, you should consider some notable costs. Getting your MBA degree will require time, money, and energy. Whether the benefits outweigh those costs depends on your situation and career goals.

Time commitment

How long it takes you to get your MBA will depend on the type of program you enroll in. A traditional full-time MBA program usually takes about two years to complete, though attending part-time can increase, and accelerated options can decrease your time commitment. Some programs also allow flexibility for students to work full-time while taking classes outside of normal business hours.

Learn more about how long it takes to get an MBA.

Tuition

MBA tuition can range from tens of thousands of dollars to over $200,000, depending on the program you attend. According to a BusinessBecause report, the average total cost of a top US MBA program in 2022 is $189,900 [4].

However, a 2018 report from TopMBA.com calculates that the average payback time for an MBA in North America is 55 months, or just over four-and-a-half years. “Payback time” includes tuition plus forgone salary, for students who took time off from work while pursuing their degree [5]. Additionally, a Wall Street Journal analysis found that 98 percent of MBA programs leave students with "manageable" debt, meaning that graduates who take out federal loans to help finance their MBA degree tend to earn more money within two years of graduation than they initially borrowed. [6].

Still, a degree can be a sizable investment, and many students turn to savings, scholarships, employer sponsorship, and loans to help ease the financial commitment.

Learn more about how to pay for graduate school.

MBA return on investment (ROI)

One way to understand whether an MBA degree will be financially worth it for you is to calculate your return on investment (ROI). This is essentially a comparison of your long-term potential gains to your short-term investment costs. Keep in mind that this calculation only deals with the financial benefits of an MBA, as you can’t put a price on the educational and relational benefits of the degree.

An ROI calculator, such as this one from MBA.com, can help you estimate your post-MBA earnings potential.

Do more expensive programs lead to better paying jobs?

The higher-cost programs tend to be ranked highly on popular lists such as US News & World Report, Fortune, and Bloomberg, and those highly ranked programs tend to lead to some of the highest post-degree salaries. However, it’s worth noting that students who attend high-tuition programs may end up with low-paying jobs, and students who attend low-tuition programs may end up with high-paying jobs.

When is an MBA worth it?

An MBA is generally considered a worthy investment for most people with a career in business, however, people pursue this level of education at different points in their careers. For this reason, there is no standard “right” time to pursue an MBA—only the right time for you, and that’s when an MBA will be most worth it.

To decide whether an MBA might be worth pursuing, consider your current position, your growth path toward your goals, and how quickly you hope to advance in your career.

Is an online MBA worth it?

If you are looking for a more flexible way to pursue your MBA, you may be interested in an online program. Online MBAs offer the same education as their in-person counterparts, but allow you to learn from anywhere with an internet connection. Oftentimes, online MBAs are also less expensive than on-campus options. Learn more about whether online MBAs are worth the investment.

Continuing your business education

If now feels like the right time to continue your business education, consider the iMBA from the University of Illinois Gies College of Business on Coursera. This competitively ranked program offers you the flexibility to learn from anywhere with an internet connection at a breakthrough price.

Sign up for Coursera today for free to start your seven-day, all-access trial and explore business specializations in digital marketing, strategic leadership, financial management, and more.