One of the world’s financial epicenters—New York City—is also home to a full-time MBA program that Fortune ranks as being seventh-best in the country. So it’s no surprise that graduates from New York University’s Stern School of Business go on to have fruitful careers in finance.
These NYU Stern MBA grads make more than $225K after graduationBY Sydney LakeOctober 18, 2021, 12:10 PM
NYU Stern is known for churning out highly employable candidates; in 2021, nearly 96% of its graduates received a job offer within three months of graduation, according to the school’s employment report. The median base salary for NYU Stern grads was $155,000, with an average signing bonus of $35,000.
Despite another year of uncertainty, the school’s most-recent full-time MBA class saw historically high compensation and employment outcomes, Beth Briggs, NYU’s associate dean of career services, wrote in the school’s 2021 employment report. “These outstanding results are built on the strong partnerships we have with our employers and alumni.”
A $190,000 starting salary directly from an MBA program far eclipses the median earnings of a master’s degree recipient—which is just $77,844, according to Northeastern University research. But certain career paths taken by Stern grads last year proved to be even more lucrative.
Money in investment banking careers
More than 28% of NYU Stern’s MBA class of 2021 went into investment banking, with grads earning a median base salary of $175,000 plus a signing bonus of almost $52,000. That’s more than $225,000 in earnings directly after earning an MBA degree—and a 10% jump in total compensation from the prior year.
Investment banks have long recruited from top-ranked MBA programs, and recently there’s been a wave of firms raising salaries for its analysts. This year, investment banks including Goldman Sachs, Bank of America, Citigroup, J.P. Morgan, and Morgan Stanley have either bumped up or promised to raise the starting salaries for analysts.
MBA grads are typically hired at the analyst or associate levels, which have an average base salary of $85,000 to $95,000 and $150,000 to $200,000, respectively, according to research by Mergers & Inquisitions. While NYU Stern shared figures only for base salaries and signing bonuses, investment bankers will typically rake in far more than that amount.
These finance professionals have the potential to earn stub bonuses (essentially a midyear bonus), an end-of-year cash bonus, a stock-based bonus, and other bonuses. This additional compensation could bump salaries for investment bankers closer to a range of $250,000 to $450,000, according to M&I data.
Why investment banks shell out for MBA grads
Investment banks are looking for three things in job candidates, Jeremy Shinewald, founder and president of MbaMission, an MBA admissions and career consulting firm, tells Fortune. Firms seek people who can work hard, have very strong analytical skills, and confer prestige upon the bank to impress investment banking clients. Essentially, these firms are looking for the type of people who graduate from top business school programs.
“They want people who are not just willing to sacrifice their time and their personal lives, but also have such strong analytical capabilities that every single number in a high-density, high-profile deal will be perfect,” he says.
Investment bankers work long hours—think 16-hour days—and thus give up much of their freedom outside the office. Often, investment deals must be done quickly and confidently, Shinewald says.
That’s why investment banks are attracted to MBA candidates. Simply put, MBA grads are predisposed to working very, very hard, Shinewald says. Plus, investment banks will pay up for “risk management,” as he puts it.
“You’re trying to make sure that you’re getting the best people who make the fewest mistakes in the most intense, high-pressure situations, which is what the banks get paid for,” Shinewald says. “I think that’s why the banks continue to try to recruit from top schools.”