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The corporate recruiters who hire boatloads of MBAs expect to pay this year’s graduating class slightly less than they did last year. Median starting salaries for MBAs in the U.S. is expected to fall by $2,000 to $90,000, according to a study of corporate recruiters by the Graduate Management Admission Council (GMAC) published today (May 21).

GMAC said such slight declines are not uncommon in post-recession years, though it brings median salaries back to their 2008 level. Indeed, in four of of the five last years, median starting salary has been exactly $90,000.  Even so, GMAC said that salary data reported by full-time two-year MBA graduates in 2012 with job offers showed an 81% increase in salary in 2012 compared with their pre-degree jobs.

GMAC attempted to spin the decline in a positive light, noting that employers continue to offer MBA new hires a significantly higher median salary when compared with new hires with bachelor’s degrees. “This premium has remained in the $40,000 range for the last five years of available data, the study found.

These figures exclude signing and performance bonuses that companies offer in addition to base salaries. In the United States, where 46% of companies offer their starting MBA hires a signing bonus, the median signing bonus for those candidates is $15,000, which matches the signing bonus offered to MBA hires in 2011.

Expected Median Starting Salary for Newly Hired MBAs At U.S. Companies

Source: GMAC 2012 Corporate Recruiter Survey

In 2012, 48% of survey respondents plan to increase MBA starting salaries in comparison to last year; a closer look reveals some nuanced results, however. The 2012 Corporate Recruiters Survey asked respondents to estimate the direction of change in base salaries for recent business hires, taking inflation into account. Globally, 13 percent of companies plan to increase MBA starting salaries above the rate of inflation and 35 percent plan to increase pay at the rate of inflation. But half (50%) of participating companies plan to keep MBA starting salaries at 2011 levels without adjusting for inflation. Similar findings are seen across all degree types and geographic regions.

While these companies are not reducing the base salaries they offer new hires, the net result of stable salaries is slightly weakened purchasing power. These results are not surprising given the sluggish nature of the current economic recovery: Many countries, including Canada, the United Kingdom, and the United States, report that wages are struggling to keep up with inflation for most employees.

Expected Median MBA Starting Salaries By Industry

Source: GMAC 2012 Corporate Recruiter Survey

Median base starting salaries varied by industry, the report showed. Comparing MBA base salaries within U.S. companies, there is a $11,000 range in starting salaries, with the lowest median base salary being offered in the health care and pharmaceuticals sector ($89,000), and the highest in consulting ($100,000). Further variance within industry was also noted. For instance, in the 25th percentile range, consultants in the United States would typically earn $85,000, on average, while those in the 75th percentile may start with a median base salary closer to $130,000.

Expected Median Starting Salaries For MBAs By World Region

Source: GMAC 2012 Corporate Recruiter Survey

GMAC said U.S. MBAs tended to receive the highest starting salaries. In Latin America, for example, recruiters expect to pay median starting pay to MBAs of just $44,616, while in Asia-Pacific they plan to pay just $25,929. “The 75th percentile salary range for both the Asia-Pacific and Latin American regions falls below the 25th percentile for salary reported in the United States. These differences tend to reflect disparities in cost of living and local demand for graduate area of expertise,” said GMAC.

A few notable differences emerge in analysis by geographic region:

• While median MBA starting salaries in the Asia-Pacific region and Latin America are below those of the United States, the report found that more Asia-Pacific and Latin American companies are increasing their starting salaries in 2012.
• Nearly a quarter (23%) of Asia-Pacific companies plan to raise their MBA hire starting salaries above the rate of inflation, and an additional third (33%) plans to increase salaries at the rate of inflation in 2012.
• Sixteen percent of Latin American companies will raise starting salaries above the rate of inflation in 2012 and 57% will be increasing salaries at the rate of inflation.
• The majority of European companies (64%) will offer starting salaries at the same level as 2011, without adjusting for inflation.

In addition to salary, GMAC reported that companies expect to offer a wide range of benefits to new business hires in 2012. In the United States, Europe, and Latin America, the most commonly offered benefit is that of a benefits package, which typically consists of health benefits and a retirement plan. Among Asia-Pacific, African, and Middle Eastern companies, GMAC said performance-based bonuses will be the most common benefit—a benefit which could serve to offset the lower starting salaries offered to new hires in those regions.

Top Five Benefits Companies Plan to Offer Business Graduate Hires in 2012, by World Region

GMAC found that company size can influence the types of benefits to be offered as well. “Larger companies are more likely to offer a moving allowance, signing or starting bonus, stock purchase plan, parental leave, and volunteer opportunities,” reported GMAC. “Smaller companies are more likely to offer commissions.”

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