The Graduate Management Admission Council (GMAC) analyzed survey responses from 4,135 alumni that graduated from 2000 through 2011, including 963 members of the class of 2011. These alumni report a stellar return on investment (ROI), with graduates recouping one-third of the financial investment in their degree within the first year after graduation, and 100 percent four years out. Compare that with a typical PhD graduate in the sciences, for example, that will likely graduate debt free after 4-7 years but go on to a postdoc position for an additional 4-8 years.
“Anyone considering a graduate management degree should do a thorough economic analysis, including an evaluation of the potential return on their investment,” said Dave Wilson, president and CEO of the Graduate Management Admission Council. “These results demonstrate that a graduate management degree is, in fact, a solid investment in your future, both in good and bad economic times.” Of course this makes sense, but lots of graduate management candidates don’t know how to conduct this kind of analysis since they come from many different backgrounds and may lack the skill to do such a comparison. Remember that there are four key variables: time to completion, cost / investment, future earning potential, and (not really part of an ROI) future happiness. Map out your degree choices over about a ten year horizon on each of these factors to do a basic, gut level, ROI evaluation.
A few other findings from the GMAC Alumni Perspectives Survey include:
- 86 percent of class of 2011 graduates were employed after graduation, which is about the same as the class of 2010 (88 percent).
- 3/4 of alumni of the class of 2011 hold jobs report they could not have obtained without their graduate management degree.
The Graduate Management Admission Council (www.gmac.com) is a nonprofit education organization of leading graduate business schools and owner of the Graduate Management Admission Test (GMAT® exam).