MBA grads on average earned two raises in 2022

BY Sydney LakeOctober 06, 2022, 1:02 PM
Graduate student seen giving a thumbs up at the City College of New York (CCNY) graduation ceremony, as seen in June 2022. (Photo by Erik McGregor—LightRocket/Getty Images)

There are many reasons to pursue an MBA—to make a career switch, develop deeper networks, and learn new hard and soft skills. But the number one motivation for earning an MBA is to get a raise, according to research from the Graduate Management Admissions Council. Other top reasons include earning a senior-level position and managing people. 

MBA students quickly reap the rewards of earning their master’s degree shortly after graduation. The current median base salary for MBA graduates is $115,000, GMAC data shows, while the median for bachelor’s degree holders is slightly more than $54,000. That gap widens year after year as MBA grads rise the ranks in their companies and nab bigger paychecks. 

On average, MBA holders receive two raises and two promotions per year, according to a study conducted by UTS Online, an online learning company. 

“Climbing the corporate ladder requires a lot of hard work, and earning an MBA is a great way to get on the right path,” Madeline Weirman, a project manager working on behalf of UTS Online, tells Fortune. “Almost half of MBA holders agree that their education has given them more credibility, in addition to more marketable skills that can add leverage for a promotion request.”

When and how do MBAs ask for a raise and/or promotion?

Asking for a raise—no matter your educational background or years of work experience—requires preparation and the right timing. More than 60% of MBA graduates say the best time to ask for a raise is around the time of performance reviews—but not performance reviews that happen at the end of the year, according to the UTS report. This typically happens during the beginning of the second quarter. By contrast, they’re least likely to ask for a raise during the last quarter of the year, according to the UTS study.

“It’s the time of year when leaders are assessing budgets and considering expenses, so it might not be the best time to ask for additional compensation,” Weirman says.

To prepare for asking for a raise, MBAs typically collect data from their past work achievements to make their case that they deserve more money or a promotion, research competitive salaries for their position, and compile a list of their accomplishments from the past several months, the study shows. 

“There’s no denying that asking for a raise can be scary, and not every request is going to be approved,” Weirman adds. “To make sure you get the raise you deserve, it’s important to do your research and gather information to support your request.”

More than 50% of MBA grads surveyed said their quality of work was the most important factor in asking for a promotion. Leadership skills, contributing more at work, and dedication to the company are other important cases to make when asking for a promotion, the study shows.

Not all MBAs get their way when they ask for a raise or promotion, though. The UTS survey shows that 54% of MBAs have quit their jobs after not receiving a raise they asked for, and 43% left after not landing a promotion they wanted. The survey doesn’t specify whether these MBAs had backup offers in place or were using these promotion or raise propositions as leverage against another offer.

To prevent disappointment or flubbing your push for a raise or promotion, avoid letting emotions cloud your judgment, asking for too much, and proving your worth. 

“It’s important to remember that this is a negotiation, not a win or lose situation,” Weirman says.

See how the schools you’re considering fared in Fortune’s rankings of the best master’s degree programs in data science (in-person and online), nursing, computer science, cybersecurity, psychology, public health, and business analytics, as well as the doctorate in education programs MBA programs (part-time, executive, full-time, and online).