Posted by: Louis Lavelle on January 27, 2012
Every year, the Executive MBA Council surveys graduating EMBA students, and this year the news was particularly good. (You can find the press release here.) The average salary and bonus for these students, who typically work full-time and attend classes on weekends, was $135,323 before they started the program, and by graduation in 2011—some 20 months later for most students—it was $157,423, an increase of 16.3 percent. Both the starting and ending salaries for the Class of 2011 were higher than they were for the Class of 2010, as was the size of the increase, which was 11.4 percent for the year-ago class.
At first blush, it’s easy to agree with Michael Desiderio, executive director of the council, who said in a statement that the survey shows “that the marketplace clearly values the contributions of EMBA graduates.” Now I’m not so sure.
First, let’s remember that most if not all of these graduates would have gotten some kind of salary and bonus increase during the time they were enrolled, even if they weren’t enrolled, and most would have had two increases, given the length of most EMBA programs. Companies can be heartless, but most of them aren’t heartless enough to give senior-level executives no increase at all for two consecutive years. It’s impossible to say if two pay raises would equal 16.3 percent, but it would almost certainly be something north of zero.
Let’s also remember that the majority of EMBA students—63 percent, according to the council’s own data—are fully or partially funded by their companies. If an employer is investing in you in one way (paying your tuition) it stands to reason that they’ll invest in you in other ways, like a decent salary or bonus.
And what about that year-over-year increase? Even that begins to look a little shaky if you think about it for a minute. According to the council's own data, the graduating class of 2011, both the average age and managerial experience of EMBA students have been trending upward (slightly) since 2007 and the percentage of female students has been trending downward (slightly) over the same period. Since more experienced managers tend to get paid more, and women less, these are trends that would likely result in higher salaries, regardless of the "value" employers attribute to the EMBA degree. By combining salaries and bonuses, the council also makes it impossible to determine how much of the year-over-year increase is "real" and how much may be the result of a big one-time bonus paid because the company had a particularly good year due to factors unrelated to the executive's work.
So that 16.3 percent is a number with a lot of noise. If you were to back out all the noise, the number might look a lot different, and the EMBA a lot less valuable.