A top Online MBA is a significant investment. The programs at the best schools can cost just as much as full-time MBAs, and easily run into a six-figure sum. Students are willing to pay these expensive tuition fees because they know an MBA will increase their salary. This is the main reason they study for an MBA. Personal development, interpersonal skills and ethics matter too, but students still expect a return on investment.
Online MBA alumni are paid on average between $100,000 and $207,000 three years after they completed their studies. Salaries flattened at the onset of the coronavirus crisis as employers cut back on promotions to improve liquidity and whether the economic storm. But pay has now returned to pre-pandemic levels and in many cases has exceeded expectations as the economic recovery has gathered steam.
“Despite the crisis, our most recently graduated cohort saw an average salary increase of 30 percent, which is consistent with that of previous cohorts,” says Lisa Umenyiora, executive director of careers at London’s Imperial College Business School.
Director and senior management roles within the finance, consultancy, technology, and oil and gas sectors are some of the highest paying routes that Imperial’s Online MBA graduates take.
What skills lead to the best post-Online MBA salaries?
Several pandemic-related factors have supported the salaries of online students. The kind of virtual communication skills and digital leadership honed in online programs have become far more relevant to employers in the era of remote work. Business leaders are managing globally dispersed teams using technology, mirroring the studies of an Online MBA student.
“Online students are learning in a program where digitally mediated collaboration is at the heart,” says Rebecca Loades, director of career accelerator programs at ESMT Berlin. “We help students improve their communication and leadership skills when interacting with colleagues in virtual environments.”
At the same time, employers have become more familiar with virtual recruitment after lockdown, which has expanded access to companies worldwide. And business schools have ramped up the career services offered to their online students, including salary negotiations.
“At Imperial, we offer salary negotiation workshops for all our MBA students to support them to gain the optimal package when they land a new job,” says Umenyiora. “In addition to pay, other benefits that we encourage our graduates to negotiate on include shares, pension contributions, leave entitlement, flexible working, relocation costs, and health or wellness benefits.”
Online students enjoy a more modest salary rise compared with their full-time counterparts on campus. Online MBAs are often taken by older students who already have substantial work experience and are reluctant to study full-time because of professional commitments. They are starting from a higher base salary, so the increase is less steep than for full-time graduates who will earn less overall.
“But an Online MBA can lead to fulfillment of career goals even if the percentage increase in salary is not huge,” says Neta Moye, executive director of career services at the University of Maryland’s Smith School of Business.
Indeed, 61 percent of Smith’s Online MBA graduates, with support from the career services team and alumni, have used their degree to change roles or companies, or have been promoted. In addition, 67 percent have received a compensation increase. Of those, 50 percent increased the salary by 20 percent or more.
“The highest-paying career paths are not dramatically different from what you would see in a full-time MBA program,” says Moye. The most lucrative jobs are in professional services, which includes accounting and consulting firms, along with the technology sector, healthcare, government, aerospace and consumer products. The highest paying roles within these sectors are in general management, consulting, marketing or sales and operations.
What’s the ROI of an Online MBA?
When it comes to return on investment, it’s worth noting that Online MBAs tend to be cheaper and run over long periods, which allows students to continue working while studying, so they do not have to forgo an income. Umenyiora says: “Students can immediately apply their learnings to their work setting, thereby providing immediate return on investment.”
She adds that online students gain increased resilience and personal effectiveness due to having to manage the additional demands of studying on their time, which can then be translated to greater effectiveness in their professional roles. “These skills are beneficial to any employer,” says Umenyiora.
Not all employers are convinced of the value of an Online MBA. There have been long-standing concerns over the quality of the online interaction between participants and faculty, though Covid has helped to reduce the stigma and forced business schools to invest in technology to improve their online learning environments.
“Online participants are just as committed if not more so than our full-time students,” Umenyiora says. “They must be disciplined to study by themselves and manage their time, they are extremely good at dealing with busy agendas and skillfully juggling their personal, professional and educational lives.”
Traditionally, online students have been looking for a career accelerator rather than a change into a different industry or function, but that is changing.
“Whilst completing an MBA can drive career progression, it also supports career change,” says Umenyiora. Of Imperial’s most recent online cohort, 77 percent changed role, 15 percent changed sector, and 13 percent changed location, despite graduating into a pandemic.