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“Show Me the Money!” Say 2016 HBS Grads

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What’s an MBA worth these days? Well, for the latest graduates out of Harvard Business School (HBS), total median pay topped out at $158,080—besting all other business schools yet to report employment data for the Class of 2016 and reflecting a 4.5 percent uptick over the $151,211 figure claimed by HBS’s own 2015 grads. These record-setting figures can be found in HBS’s 2016 employment report, released today.

To arrive at that median pay figure involves starting out with the median base salary reported for the entire class—$135,000—and adjusting for the bonuses reported by a percentage of the class. This year, 68 percent of the class also got a median signing bonus of $25,000, and 19 percent of the class got median “other guaranteed compensation” of $32,000. Signing bonuses stayed constant this year over last, but median base pay increased from $130,000 for the Class of 2015 and median other compensation rose from $26,000, resulting in the upward climb of overall median pay packages.

The $158K and change puts HBS grads ahead of those just coming out of the University of Pennsylvania’s Wharton School, where total median pay was $146,078, according to that school’s employment report, released last week. Right on Wharton grads’ heels were 2016 graduates from the University of Chicago Booth School of Business, where total median pay reached $145,750, according to interim employment figures released in August. Stanford Graduate School of Business (GSB) has yet to release its 2016 employment report. Last year, Stanford GSB total median pay was $160,425—due in great part to staggering median other guaranteed compensation of $52,500 reported by 37 percent of graduates. In all instances, compensation data is self-reported by graduates and excludes students who are company sponsored or who are starting their own companies, in accordance with MBA Career Service & Employer Alliance (MBACSEA) standards.

Among the most recent crop of HBS grads, those pulling down the largest pay packages were the 9 percent of the class heading into investment management and hedge funds. For these folks, the median base salary was $177,500, with 52 percent receiving a median starting bonus of $35,000 and 23 percent receiving median other compensation totaling an additional $125,000. Those select graduates who got both the median starting bonus and median other compensation, a first-year comp package of $337,500 sure makes the $204,200 suggested budget for two years at HBS seem worthwhile, no matter the opportunity cost of taking two years out of the work force. (To be fair, median total pay packages for those going into investment management and hedge funds were $196,950.)

Median base pay has risen each of the past three years for HBS grads, from $125,000 in 2014 to $130,000 last year to this year’s $135,000. That’s after a hanging out at a paltry $120,000 for the two years before that. Wharton and Chicago Booth grads have lagged behind their Boston rival in this regard. Median base pay for 2016 grads at both schools was $125,000, unchanged in both instances from the prior year. Stanford GSB, which again has yet to release 2016 data, reported a median base pay for 2015 graduates of $130,000, a four percent increase over the $125,000 level it had been at for the four preceding years.

Finance, Consulting, Tech Draw the Most 2016 HBS Grads
In terms of the industries HBS graduates are choosing, there haven’t been huge shifts in recent years. More students—28 percent—went into financial services than any other industry, down slightly from 31 percent the year before. Of those, 13 percent went for venture capital, private equity or leveraged buyout opportunities; 9 percent took the biggest money route with investment management/hedge funds; 5 percent went into investment banking or sales and trading; and 2 percent went into other financial services. The consulting industry was a close second, drawing 25 percent of the class, up one percent over 2015. Technology firms snapped up another 19 percent, off a percentage point from 2015. Median base salaries in finance ($150,000) and consulting ($145,000) exceeded the $135,000 median base pay for the class as a whole, but median base salaries in tech trailed slightly, at $125,000.

Smaller pockets of 2016 HBS grads headed off into other industries—8 percent into healthcare, 5 percent into manufacturing, 4 percent into services, 3 percent into consumer products, 3 percent into entertainment and media, and 2 percent each into nonprofit/government and retail. As with the leading three industries, shifts here were relatively unremarkable year over year.

Entrepreneurship Dips Slightly
In terms of entrepreneurship, 7 percent of the HBS Class of 2016 took jobs at startups, defined as an organization three years of age or younger. This is down from 9 percent of the Class of 2015 but up over the 5 percent of the Class of 2014 heading for startups. The median starting salary for those heading to recently launched firms this year was $125,000, returning to the same level as 2014 after dipping to $120,000 last year. Of the startups drawing the most recent group of HBS grads, 45 percent went to tech firms, followed by financial services (21 percent) and healthcare (19 percent). The remainder were split between startups focused on services, consumer products, entertainment/media and government/nonprofit. The number of HBS grads setting out to found their own companies in 2016 was 64, a drop from 2015’s 84 founders.

View complete 2016 HBS employment statistics here.