The optimistic vibe in MBA hiring has apparently met or exceeded expectations, according to a new study of job placement and salary data at the top 30 U.S. business schools by Poets&Quants. There was no shortage of job offers for graduating MBAs in the Class of 2013, making predictions for the upcoming year fairly upbeat.
This year, well over half of Poets&Quants’ 30-top-ranked U.S. schools reported stable or improved job placement rates. Some schools reported dramatic increases in job offers to their graduating students. The University of North Carolina’s Kenan-Flagler School saw an improvement of eight percentage points over last year so that 96.1% of its MBA graduates had job offers three months after graduation, up from only 88% last year. Along with Ohio State’s Fisher College of Business, Kenan-Flager posted the best MBA job placement rates for a public business school in the U.S.
The biggest surprises in the study? For the second consecutive year, Emory University’s Goizueta School of Business boasted the best MBA placement record of any U.S. business school in the Top 30, with 98.1% of the Class of 2013 reporting job offers three months after graduation. That is a full ten percentage points ahead of UCLA’s Anderson School, with 88.0% of graduates having offers, or the University of Michigan’s Ross School of Business, where 88.7% of this year’s MBAs had offers three months after commencement.
Wharton & Columbia were among the schools with the best placement records
Of the big name players in the MBA market, the best numbers came from two schools that have had to adjust to significant downsizing on Wall Street given their renown strength in finance. The University of Pennsylvania’s Wharton School reported that 97.8% of its Class of 2013 had a job offer three months after graduation, while Columbia University’s Business School reported that 97.0% had offers. After Goizueta, Wharton and Columbia had the best MBA placement records in the U.S. this year. New York University’s Stern School, whose fortunes are also somewhat tied to Wall Street, had its best MBA placement year in the past four years, with 96.0% of this year’s class with job offers three months after commencement.
Another surprise. Both Wharton and Stanford Graduate School of Business graduates reported higher median starting salaries this year than graduates of Harvard Business School. In all likelihood, it’s the first time that Wharton’s base salaries have exceeded Harvard. The difference is little–just $5,000–but it’s a completely unexpected turn of events. Wharton and Stanford MBAs earned the highest median salaries this year–$125,000–with Harvard next at $120,000, tied with Northwestern University’s Kellogg School of Management, MIT Sloan, and UC-Berkeley’s Haas School of Business.
Harvard attributed the difference to the fact that HBS students are pursuing more options where they can have impact sooner rather than later. This year, for example, there was a 50% increase in the numbers of students going into the technology sector, which tends to pay less than either consulting or banking. Some 18% of the class took jobs in tech, up from 12% of the class in 2012. “For many of these folks, that meant taking an equity stake in a new or recent venture, rather than salary,” explained Kristen Fitzpatrick, who heads Harvard’s career and professional development office.
Fewer Harvard MBAs went into highly lucrative private equity & venture capital
Meantime, roughly 5% of the class took jobs in the non-profit sector, up from 3%. “They will definitely make their mark, but not win recognition for a high salary,” adds Fitzpatrick. “Beyond all this, the numbers of the class going into high-paying PE/VC firms are down–10% this year, down from 16% last year.” Add it all up and for the first time in history, Harvard grads made less than the MBAs at Wharton.
More telling than the salary numbers, however, are the latest placement stats. By and large, they confirm a strong and continuing recovery in the market for top-ranked MBA graduates. Some 23 of 26 reporting schools in Poets&Quants Top 30 report that more than nine out of every ten graduates had at least one job offer three months after graduation. The numbers are so impressive they very nearly put to rest the rather dismal statistics that came out of these same schools during the height of the Great Recession in 2009 and 2010.
Consider Vanderbilt University’s Owen School, which reported all-time high placement and pay numbers this year: 95.6% of the school’s graduating MBAs had job offers three months after graduation, up from 91.1% last year, 86.9% in 2011, and 87.1% in 2010. Median salaries for the Class of 2013 showed a sharp increase to $100,000 from $92,000 last year.
“On-campus recruiting is up 15% since the 2010-2011 academic year and the number of companies making multiple offers has grown significantly,” says Reed McNamara, managing director of Owen’s Career Management Center. “Most notable is the rapid rise of Amazon to its position as the most active employer with 13 accepted internship and full-time offers last year.” Other firms with multiple accepted offers, according to McNamara, include Deloitte (8), ExxonMobil (8), DaVita (8), Mattel (8), Nissan North America (6), The North Highland Co. (6), Capgemini (5), and Goldman Sachs (5).
The industries doing the heavy hiring this year was consulting and finance. But an increasing number of MBA graduates went into the technology sectors, often with smaller startup companies, as Harvard reported. And many more started their own companies right out of school, including a record 18% of the Class of 2013 at Stanford Graduate School of Business.
More than a handful of top schools reported declining placement numbers
Amidst the good news on the MBA hiring front, there were still more than a handful of schools reporting declines in job placement. They include Harvard and MIT Sloan, along with the business schools at Duke, Virginia, and UCLA. Though a school’s placement numbers can be off in any given year due to geography or industry focus, highly ranked schools that consistently lag behind the averages are more likely to underinvest in career services function or suffer from lackluster management of the function. But there can be any number of reasons why a school’s placement rates can trail peers or simply fall.
At Virginia’s Darden School, job offers three months after graduation slipped to 89.6% from 94% last year and 95% in 2011. Jack Oakes, assistant dean for career development at Darden, says the drop is the result of several “patterns” that have emerged in recent years. “People are increasingly focused on niche hiring opportunities in very targeted locations,” he says.
“An example would be private equity in San Francisco or commercial real estate in New York City. The other factor is that a number of our grads are searching for jobs with their spouse or partner in mind. It makes it more difficult for some because they are making decisions not only for themselves but also for their partners. And we have more students focused on working for smaller technology companies. That can be a longer search, especially if you want to be out in Silicon Valley where a lot of companies have a ‘show me’ attitude and ask you to come out to the valley first.”
At the University of Southern California’s Marshall School of Business, which reported the lowest placement numbers of any top 30 business school, 18% of the Class of 2013 still had not received a single job offer three months after graduating with the MBA. The 82.0% job offer rate at Marshall, however, was an improvement from last year when the school reported a 77.0% rate which the school attributed to turnover in the leadership of its career services function. A USC spokesperson said “the main difference between those who were waiting on offers after three months is that for the most part this group was seeking and holding out for opportunities they wanted in the tech and entertainment/media industries, which tend to be on a different hiring schedule.”
Emory’s Goizueta: a case study in a world class career services function
Ahead of the pack for two years in a row, Emory’s Goizueta School is making itself a case study in how to manage a world-class career services function. “There is no secret,” says Wendy Tsung, associate dean of MBA career services. “It’s just a lot of hard work. I think a lot of what we have been doing in the last five years has really started to click, from changing the curriculum, to being involved in the admissions process upfront, and to looking at the entire lifecycle of a student.”
One clue to Emory’s chart-topping placement numbers is the fact that for the past five consecutive years–starting when the economy was in the tank–the school has had been able to place 100% of its two-year, full-time MBA students in paid internships. Close to 60% of its students now return with a job offer in hand. “Our goal is for students to get into a role where they want to be full-time and have the opportunity to convert that internship into a full-time offer,” says Tsung. “We don’t count volunteer work as internships. These students are in real paying jobs that often lead to full-time offers. They are not doing project work.”
Tsung’s staff–composed of four full-time career coaches, two employer relations staffers, a director for the full-time MBA center, an office manager and a recruiting coordinator–also intervenes early before the 140 or so two-year MBA students step on campus. The group surveys incoming MBA candidates about their career goals and pairs them with rising second-year peer career coaches. Students undergo self-assessment to identify strengths and weaknesses and optimal career options. When they show up on campus in early August, students go right into a personal development course taught by career center staffers, alumni and recruiters.
Emory MBA students are meeting with companies before most MBAs even start class
Before the month is out, often before other MBA candidates start class at their schools, Goizueta has its students already meeting with corporate recruiters. On Aug. 23 this year, for example, representatives from more than 25 companies, including Accenture, AT&T, Coca-Cola, Deloitte, GE Capital, Humana, Johnson & Johnson, J.P. Morgan, and Wells Fargo, came to an event called the Goizueta Career Connection to jumpstart the fall recruiting season. That is extraordinarily early for an MBA recruitment event.
Many business schools have “blackout periods” for recruiters until October, hoping to keep employers at bay so that students can adjust to the academics. Goizueta’s policies recognize that the most anxiety provoking challenge for an MBA student is his or her career decision and ultimate job search. By stacking the odds in favor of a successful job outcome, however, the MBA students face fewer conflicts between the academics and the need to land a solid position at graduation. Student satisfaction has risen as a result.
Since the school revamped its curriculum so that the core is taught in the first semester, students with full-time offers at the end of their internships have more than doubled. The early start, the one-semester core, the early outreach by the career staff along with their close follow-up has made a huge difference in the school’s outcomes. “We want to make sure that our students are successful,” adds Tsung. “We know what is going on with them. We are working with the students on a very individual level, and this generation of students want to bounce things off people more and more. They want to check in and there is a lot of that.”
Even at 98.1%, still room for improvement?
The school also has worked hard to close the gap between job offers and acceptances. This year, 96% of the class had accepted a job offer three months after graduation–a number that was higher than most schools’ reported offer number. So the gap between offers and acceptances was just two percentage points. At graduation, 86% of the class had offers and 81% had accepted them–a gap of five percentage points. “When I first started, the gap was over ten percentage points,” notes Tsung, who came to the school in September of 2006 from her job as a partner at Mitchell Madison Group. “That signals a few things. We want to make sure that it’s worth students’ effort to find what they really want. And we don’t want to waste employers’ time to make a bunch of offers and come away empty handed.”
As high as Goizueta’s job placement rates are, Tsung seems not fully satisfied. “We had one more person come back with an offer ten days after the closing period (for reporting the three-month after graduation),” she says almost wistfully. That would have pushed the 98.1% close to 99%.
2013 Job Offer, Salary & Sign-On Bonuses For Top U.S. MBA Programs
Source: Business schools reporting to Poets&Quants
Notes: Job offer data is for three months after graduation, with most 2012-2010 data rounded up or down. Median salaries and median signing bonuses are for the Class of 2013 only. * Average rather than median