Show Me the Money - Is an Mba Degree Worth the Investment?

"Show Me the Money"

Is an MBA Degree Worth the Investment?

"Show Me the Money" Is an MBA Degree Worth the Investment?

Life is full of choices, sometimes people make the right ones and other times the decisions turn out to be disastrous. In any event, people make hundreds of choices every day with varying significance and different consequences. In the current economic state of the country, many individuals are experiencing a difficult time maintaining constant employment. Layoffs, downsizing and closures are affecting a large percentage of American companies and the employees. Unemployment rates are reaching levels that haven't been seen in many decades. This has forced a large number of individuals to make difficult choices regarding career path, progression, and even total change of profession.

Documentation shows that the vast majority of human beings use 10% or less of the brain's capability. For many of the individuals facing significant career challenges, the choice to test the brain's ability has been made and the pursuit of higher education is in demand. A very popular degree choice among professionals returning to the educational environment is the Master of Business Administration (MBA) program. The return on investment from obtaining this degree has been the topic of many debates, but the MBA degree may provide benefits previously undiscovered and overtime negate the investment cost.

According to the University of Phoenix (2009), "the MBA program prepares students in the functional areas of business allowing them to develop managerial skills necessary to be effective in a rapidly changing business environment" (Program Summary, para. 1). Additionally, and possibly more important, the MBA degree program teaches individuals how to lead and manage various aspects of business. Because of the broad spectrum of knowledge gained from this degree program, individuals have an increased capability to handle complex problems, motivate personnel and analyze data sets to help ensure competitive and positive impact on business objectives.

Considerations for Degree Pursuit

Each individual chooses to obtain an MBA degree for specific and unique reasons. Even though the previously mentioned program characteristics are attractive, not all choose this path for the stated reasons.

Compensation

According to the adage, "money makes the world go round." It is no secret that first and foremost on a large percentage of individual's minds is compensation. The main objective of business is to maximize profits and this idea also holds true for the individual. Will the achievement of earning an MBA degree actually bring the added income? This question can be far more difficult to answer if issues other than just dollars and cents are evaluated. Many people put a price on quality of life, additional knowledge gained from course curriculum and new found leadership and communication skills. According to the United States Department of Labor (2010), individuals who possess a Master's degree have a median weekly salary of $1,257. This is higher than people with only a Bachelor's degree, since the median weekly salary is $1,025. This comparison, in fact, does support the idea that additional education pays off.

Additional factors that should be considered when return on investment for an MBA degree is discussed include the following. The cost of school tuition and any money lost from time spent in class and not working. Participants must evaluate the earning potential after completion and determine if the degree is a worthy investment. Statistics show that individuals successfully completing an MBA degree can expect to see a 43% - 64% increase in annual base salary (Graduate Management Admission Council, 2010, p. 10). There are many factors that will affect the amount of financial increase graduates will experience, such as prior knowledge, location, industry, economic conditions, etc. As with any investment, it is important for each individual to analyze the applicable data and make calculated