“Starting at €60,000 [at the start of the millennium], MBA salaries have actually developed quite a bit,” explains Melanie Janke, head of corporate relations and the career service at HHL Leipzig Graduate School of Management in Germany.
“In 2010 we saw starting salaries that were on average €72,000. Before the financial crisis in 2008, the salaries were on average €75,000. There was a slump in 2009. Who had got a job would have to be satisfied with a starting salary of about €65,000 on average.”
However, as the largest European economy, Germany’s financial state is relatively healthy, despite having to help bail out some of the defaulting Euro nations. As a result, salary levels in the country are returning to their pre-recessionary levels.
According to Mannheim Business School’s director of communications, Ralf Buerkle, after a period of depression, MBA salary levels are back on the rise.
“According to our school’s statistics, the salaries of our graduates have significantly increased in the past years,” he says. “As Germany has not been as strongly affected by the financial crisis as other nations, the German job market proved to be robust during and after the crisis. MBA graduates could benefit from this.”
But while future salary levels in the country look promising, those applying to MBA programs may still be a little too hopeful.
The TopMBA.com Applicant Survey 2011, the largest survey of the mindset and aspirations of MBA applicants in the world found that German MBA aspirants expected the highest salaries in the world after completing an MBA. In fact, with an average target salary of US$145,880, MBA applicants in Germany expect over US$20,000 more than any other nation.
“This figure seems very high to me and does not reflect our statistics,” says Dr Annegret Zurawski, academic director of GISMA Business School. “German companies rarely pay an extra bonus just because an applicant comes with an MBA degree. What they value most is pre-MBA work experience and this is what they mainly pay for. The younger the MBA graduates the more they have to compete with graduates from other masters programs, and with the lower salary expectations of those graduates.”
The average MBA salary in Germany, according to the QS Top MBA Jobs and Salary Trends Report 2010/11 is US$78,158. QS’ report surveys MBA employers and recruiters around the world, allowing applicants, business schools and employers a glimpse into current global salary trends.
It is worth noting that while graduate starting salaries may be below expectations for the average German MBA applicant, salaries do of course increase as MBA alumni progress with their post-business school careers.
A recent MBA salary survey conducted by the salary comparison company Payscale for Bloomberg Businessweek found that over 20 years, MBA alumni from the 57 US business schools in Businessweek’s 2010 MBA ranking saw salaries totaling US$2.4m on average.
While this data clearly relates to US MBA alumni salaries, what can be gleaned from the statistics is an average rise in pay over a 20-year period, which can then be compared with salaries in Western Europe.
According to QS’ jobs and salaries report, MBA graduate starting pay in North America and Western Europe averaged US$86,000 and US$88,000 respectively. Over 20 years, these salary figures work out at under US$1.8m, indicating that alumni from the top business schools can expect pay-rises totaling around US$600,000 over a 20-year period.
Dr Zurawski at GISMA says that in Germany, MBA alumni from her business school have seen impressive salary increases a few years after entering the workforce with their degree.
“Our experience is that the MBA degree certainly pays off quickly as soon as students start with their first post-MBA job. Companies that are not that experienced with MBA graduates and what they can do for their company are excited about the tools, motivation and work ethics MBA graduates bring to the company. That’s why MBA graduates in German companies often climb up the career ladder quickly and thereby increase their salaries.
“Our latest statistics shows that GISMA graduates are on average able to increase their salary by 115% within three to five years after graduation.”
German graduates can further increase their potential salaries by entering higher earning industries.
“The industries which pay the highest starting salaries are consulting and financial services, as well as the property sector,” explains Janke, before pointing out that to enter such lucrative roles, graduates will need to impress, and be prepared to sacrifice their spare time.
“The reason for this is that these industries hire only the best candidates. These employees can ask for a higher salary. In the aforementioned industries you can find the highest working hours per week. In the consulting sector, for instance, there is an average 70-80 hours per week; and even more hours when one works in the financial sector. Moreover, the salaries are strongly dependent on the individual qualifications and work experience.”
However, Buerkle notes a sector that, in Germany in particular, small and medium enterprises (SMEs) could well prove to be a more viable career option for the graduates of Germany’s MBA programs.
“Germany has another interesting sector for MBA graduates: the SMEs which are considered to be the backbone of the German economy. Many of them are world market leaders in their respective industries; they are highly internationally oriented and offer graduates excellent career opportunities. This should always be considered by those who intend to do an MBA program at a German business school.”
To give MBA applicants the chance to meet top business schools from all around the world, the QS World MBA Tour will visit various cities across Europe, Asia, North America and Latin America, including German cities Frankfurt and Munich in late October. Traveling alongside the QS World MBA Tour, Connect 1-2-1 gives applicants the opportunity to meet business school representatives in an informal one-on-one environment. Find out more about QS' MBA events.