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7.2 SALARY & BONUS COMBINED

When comparing compensation levels, it is important to consider not just the base salary, but also the likely total earned in one year, including bonuses.

Overall MBA earnings (salaries and bonuses) are on the increase in almost every country in the world. As demand for MBAs surges in consulting and financial services, recruiters must compete on total earnings to secure their preferred candidates. But, some regions of the world are "hotter" than others, with parts of Asia (China in particular and parts of Europe (the UK in particular) reporting larger earnings increases in dollar terms. In 2007, the average reported bonus is a sizeable US $ 24,000, with investment banks leading the bonus field, with an average bonus of $ 46,500. Mike Holmes of www.global-workplace.com observes, "With so many service companies hiring more aggressively, there is now strong upward pressure on total compensation in many markets."

The larger bonuses payable by banks and financial services companies in particular, ensure that they offer the greatest overall compensation for the first year out of business school, averaging US $ 140,000 in 2007. Some investment banks reported six figure bonuses pushing overall compensation in excess of $ 200,000. Consulting firms are only just ahead of other sectors in the overall pay bracket, at $ 129,500 per annum. This is partly because many smaller consulting firms responded to the survey, but also because the larger consulting firms rarely pay large bonuses at the end of the first year, whereas other sectors have increased their bonus payments in 2007. All sectors, apart from Government, have average compensation ranging between $ 100-140,000.

For the first time ever, two technology companies - one European and one US - reported the highest starting salaries for new MBAs in this year's survey. They also reported large bonuses.

Salaries in Metals and Mining were also much higher this year than in any previous year, reflecting the boom, which this sector is experiencing.

The government sector lags behind private industry in average total compensation, due to a tendency not to pay end of first year bonuses (World Bank pay compensation comparable with private sector banks and is included in 'banking' sector).

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Source: -
QS World MBA Tour - QS TopMBA.com International Recruiter Survey 2007
© QS Quacquarelli Symonds Ltd. 2007
Website: www.topmba.com