Crazy high salaries for MBA graduates
I wonder how much of this is because a lot of people who were high earners before going to business school are also high earners upon graduation, but it is tough to argue with $286,000 per year as a median first-year-out-of-MBA-school income (for MIT Sloan graduates). See Bloomberg for some more numbers.
[See Real World Divorce, though, for how an American resident or visitor doesn’t need to go to business school, or to work at all, to have this kind of after-tax spending power. The Massachusetts chapter has at least one concrete example.]
Readers: Is this rational behavior for employers? Why not hire smart folks fresh out of college for $100,000 per year, have a night school at the company where they go through the MBA textbooks and watch some YouTube videos, and promote the best of this group? Or back it up to high school graduates! Hire them for $50,000 per year, supervise their online bachelor’s degree in the evenings at the company’s office, and promote from that pool? Why let MIT and Harvard college huge $$ to do the filtering? You can argue that you’re investing money in training people who will quit, but most of the investment is a conference room that wouldn’t be used at night anyway. Also, if you hire an MBA at $286,000 per year and he or she gets some experience at your firm there is always a risk that the MBA will quit for a yet higher salary elsewhere (these are not teachers, certainly, who will just keep working despite being underpaid).
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