People scramble to earn an MBA degree: studying, taking tests, and making sure they go to a prestigious business management school.
However, the experience can be a cruel but enlightening teacher. In the job industry today, few organisations care about an MBA.
Instead, companies focus on skills and certifications relevant position. Rarely does an MBA degree come into play, and hardly is it given precedence over other skills and qualifications.
How employers value MBA degrees
For employers today, experience and likability trump an MBA degree. This reason is simple: it does not guarantee compatibility with the job.
Just because someone has an MBA does not mean that they will be adept leaders and workers and can handle all the issues that arise within the workplace.
The actual cost of getting an MBA degree
Looking into the financial aspect, the cost of acquiring an MBA outstrips the salary gains after the degree. So you hardly get a return on your investment.
Let’s break it down:
An MBA degree will cost you at least $100k without taxes and interest. That means that you will have to make at least $200k to cover what you spent to earn your degree!
You have to work for more than two years and not spend a cent. Not an attractive prospect, is it?
This also means you can’t divert the $100k you invested to more income-producing assets, such as a house, a mutual fund, or other things that reap benefit over time.
A loan might seem like an attractive option. However, there is a downside to this. You now have to pay the cost to earn your MBA degree plus interest and the taxes.
What about a part-time MBA?
It is appealing. However, it is still expensive, and you may end up facing the same scenario described above.
Juggling a full-time career and earning a part-time MBA degree is stressful!
Many MBA grads are disillusioned that because they have a fancy and expensive degree, they will get a high-paying job. Often, they are disappointed.
Fact is, employers today are less impressed by a degree than they are by experience and skills. Someone with a degree but no skills are automatically off the table. Also, if they do hire you, don’t expect a higher salary you can use to pay off your student loans. Instead, your salary will be based on how much experience and skill you have.
Of course, some industries require you to have an MBA degree. Examples of these are senior-level consulting and finance role. However, you don’t need to have one to get the job because the company will shoulder it once they hire you.
It is crucial to consider an MBA if you’re in transition carefully. We do imagine it could be a gamble to venture out to gain a degree that may or may not derive a return that is worth the time and money you spent on it.