In March, Poets&Quants reported on a new ranking of leading MBA programs in the United States that measures return on a student’s investment. The ranking was developed by Georgia Tech Scheller College of Business based on the cost of attendance and graduates’ starting salaries at the top 30 B-schools in U.S. News & World Report’s annual ranking.
The Scheller College’s list calculates an MBA-salary-to-tuition ratio by comparing median starting salary and total out-of-state tuition/fees for two years of residential MBA study, with data sourced from the schools themselves. Based on data from the release April 25 of the new U.S. News ranking, Georgia Tech in April updated its ROI ranking and made some significant changes.
The biggest was that Georgia Tech itself temporarily took over the No. 1 spot. But not for long. Because of a data inputting error, the University of Texas at Dallas’ Jindal School of Management had been stuck at the very bottom of the ranking. After fixing the error (but not notifying Poets&Quants), Georgia Tech recalculated — and the Jindal School vaulted to the very top of the ranking.
ELITE SCHOOLS DON’T FARE WELL IN THIS RANKING
The problem was that the ranking doubled Texas-Dallas’ tuition to reflect two years of MBA study. But the Jindal School’s MBA is an 18-month program, with an option for an extra semester. The change meant Jindal, ranked 27th by U.S. News, jumped 29 spots in Georgia Tech’s ROI ranking, from a worse-than-even salary-to-tuition ratio to the best at 1.63. Texas-Dallas’ MBA Class of 2022 reported an average starting salary of $106,000, and the school charges tuition of $64,939.
The Scheller College now ranks second on its own list behind Texas-Dallas Jindal, with a score of 1.62, beating out No. 27 University of Rochester Simon Business School (1.53), No. 20 University of Washington Foster School of Business (1.28), and No. 22 Indiana Kelley School of Business. Georgia Tech’s MBA Class of 2022 reported an average starting salary of $136,819, and the school charges tuition of $84,516.
The top three schools in U.S. News‘ new ranking, Chicago Booth School of Business, Northwestern Kellogg School of Management, and the Wharton School at the University of Pennsylvania, did not fare as well on the Scheller College’s ROI list: Chicago Booth, with a score of 1.09, is 12th; Northwestern Kellogg, with a score of 1.01, is 25th; and Wharton is 20th with 1.04. Booth and Wharton boasted 2022 MBA starting salaries of $175K, and Kellogg’s was nearly as impressive at $165K, but all three also have tuition of more than $160K.
A spokesperson for Georgia Tech says the school will publish a new ranking, including updated salary data, at the beginning of December.
Salary to Tuition Ratio | U.S. News & World Report Ranking (2023 – 2024) | School | Median Starting Salary (Class of 2022) | Tuition and Fees (Out-of-State Total) (Fall 2023) | % Received Offer (Class of 2022) | Salary to Tuition Ratio |
1.63 | 27 (Tie) | The University of Texas at Dallas (Jindal) | $106,000* | $64,939 | 90.0% | 1.63 |
1.62 | 26 | Georgia Institute of Technology (Scheller) | $136,819* | $84,516 | 100.0% | 1.62 |
1.53 | 27 (Tie) | University of Rochester (Simon) | $162,000 | $105,816 | 95.0% | 1.53 |
1.28 | 20 (Tie) | University of Washington (Foster) | $143,203 | $112,254 | 99.0% | 1.28 |
1.16 | 22 (Tie) | Indiana University (Kelley) | $130,000 | $111,666 | 96.2% | 1.16 |
1.15 | 08 (Tie) | University of Michigan, Ann Arbor (Ross) | $175,000 | $151,448 | 96.0% | 1.15 |
1.11 | 20 (Tie) | University of Texas, Austin (McCombs) | $129,854 | $117,440 | 94.3% | 1.11 |
1.11 | 06 (Tie) | Stanford University | $175,000 | $157,146 | 93.0% | 1.11 |
1.10 | 24 (Tie) | Rice University (Jones) | $152,000* | $138,000 | 89.9%§ | 1.10 |
1.09 | 15 (Tie) | Cornell University (Johnson) | $175,000 | $159,820 | 94.0% | 1.09 |
1.09 | 17 | Emory University (Goizueta) | $165,000 | $151,689 | 98.0%§ | 1.09 |
1.09 | 1 | University of Chicago (Booth) | $175,000 | $161,051 | 96.8% | 1.09 |
1.08 | 5 | Harvard University | $175,000 | $162,748 | 95.0% | 1.08 |
1.07 | 11 (Tie) | Duke University (Fuqua) | $160,055 | $150,000 | 98.0% | 1.07 |
1.06 | 06 (Tie) | Dartmouth College (Tuck) | $175,000* | $165,442 | 98.0%* | 1.06 |
1.05 | 08 (Tie) | Yale University | $175,000 | $165,400 | 91.5% | 1.05 |
1.05 | 14 | University of Virginia (Darden) | $167,899 | $159,400 | 94% | 1.05 |
1.05 | 15 (Tie) | University of Southern California (Marshall) | $150,314* | $143,560 | 97.0%§ | 1.05 |
1.05 | 24 (Tie) | Georgetown University (McDonough) | $138,552* | $131,344 | 96.0% | 1.05 |
1.04 | 3 | University of Pennsylvania (Wharton) | $175,000 | $167,748 | 98.7% | 1.04 |
1.03 | 11 (Tie) | Columbia University | $175,000 | $169,150 | 95.0% | 1.03 |
1.02 | 10 | New York University (Stern) | $170,000 | $166,330 | 94.1% | 1.02 |
1.02 | 27 (Tie) | Vanderbilt University (Owen) | $139,711* | $136,640 | 97.0% | 1.02 |
1.02 | 30 | University of Notre Dame (Mendoza) | $130,000 | $126,880 | 96.0% | 1.02 |
1.01 | 2 | Northwestern University (Kellogg) | $165,000 | $163,572 | 99.0% | 1.01 |
1.01 | 11 (Tie) | University of California, Berkeley (Haas) | $155,000 | $152,866 | 93.8% | 1.01 |
0.99 | 4 | Massachusetts Institute of Technology (Sloan) | $165,000 | $165,992 | 96.6%§ | 0.99 |
0.97 | 18 | Carnegie Mellon University (Tepper) | $148,067* | $151,424 | 97.0%* | 0.97 |
0.97 | 19 | University of California, Los Angeles (Anderson) | $145,000 | $149,248 | 93.9% | 0.97 |
0.94 | 22 (Tie) | University of North Carolina, Chapel Hill (Kenan-Flager) | $133,517 | $142,728 | 96.0% | 0.94 |
* Median starting salary data not available, mean starting salary data is used
† Class of 2022 data not available, Class of 2021 data is used
‡ Median starting salary and Class of 2021 data is used
§ % received offer data not available, % accepted offer data is used
‘A STRAIGHTFORWARD, QUANTITATIVE SNAPSHOT’
In all, 26 of 30 schools in Georgia Tech’s updated ROI ranking offer an even ratio or better. The bottom three on the list: Carnegie Mellon Tepper School of Business, ranked 18th this year by U.S. News; UCLA Anderson School of Management, ranked 19th; and UNC Kenan-Flagler Business School, ranked 22nd. See above for the full ranking.
As P&Q reported in March, the Scheller College’s ranking doesn’t take into account many important factors for applicants, such as scholarships, in-state residency, individual career goals, and crucially, acceptance rates for these leading programs. Like most quantitative lists, it also neglects the all-important “name” factor: that graduating from Stanford or Wharton or Harvard or Kellogg will open doors that might otherwise remain closed (or that have to be pried open by other means). And since it’s one school posting data about peers, there’s always the danger of misrepresentation.
The MBA-salary-to-tuition ratio tool can be a handy starting place for would-be applicants, though, showing that at least as far as salary goes, smaller programs can be just as beneficial to careers — or more so — as the Stanfords, Whartons, and Harvards of the world. “There are many factors that are important in making an MBA program decision,” Dave Deiters, associate dean of MBA programs and the Scheller College’s Jones MBA Career Center, tells Poets&Quants. “Some are subjective and personal, while others are more objective. The MBA-salary-to-tuition ratio provides a straightforward, quantitative snapshot for prospective students to use in comparing the financial value of various programs.”
However, when you take a longer view, some of the schools that appear very favorable on this list are a bit less so over the long haul. The lifetime median cash payout for an MBA from a Top Ten business school is more than $8 million, compared to $5.7 million for the MBA from a Top 50 program (see The MBA Premium: What MBAs Earn Over A Lifetime and The MBA Bump: MBA Grads Now Get An $85K Bump Over Pre-MBA Pay).
See the Scheller MBA-salary-to-tuition ranking here.
DON’T MISS: THE TEN BIGGEST SURPRISES IN THE 2023-2024 U.S. NEWS MBA RANKING or POETS VERSUS QUANTS: HOW U.S. NEWS RANKS THE TOP B-SCHOOLS BY MBA SPECIALIZATION
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