It should come as no surprise that management consultants who work at McKinsey, Bain and Boston Consulting Group (BCG) – the MBB firms – make more money than their counterparts at other big consulting companies. But just how much?
When it comes to raw dollars, the difference depends mainly on your education. Fresh business school and PhD graduates at McKinsey, Bain and BCG can earn close to $250k during their first year, after taking into account potential signing bonuses, performances incentives and company contributions toward retirement. As you can see in the first chart below, newly-employed postgrads at the Big Four do rather well in their own right, though not quite to the level of consultants at MBB firms. In fact, the main takeaway from the new data may be that it can really pay to get your MBA (or for a select few, a PhD). Their earning power topples that of undergraduate hires (second chart below) by more than two-fold in some instances.
The research, put together by executive coaching firm Management Consulted, comes from surveys of new consultants who accepted offers in 2019 as well as the hiring companies themselves. The total compensation figures for each firm in the charts include average base salaries and signing bonuses as well as the upper echelon of potential year-end bonuses, so the totals likely lean closer to maximum first-year earnings than the overall average. At McKinsey, a new MBA hire can earn north of $200k during their initial year due to a lofty $30k signing bonus, according to the report. However, BCG has the most upside when it comes to compensation as its performance bonuses can reportedly reach as high as $45k.
As for the Big Four, Deloitte and KPMG offer the highest ceiling, though KPMG MBAs appear to be in line for more cash up front. Every firm offers some sort of relocation assistance, while all but two – EY and KPMG – contribute toward retirement, at least according to Management Consulted.
The compensation totals for undergrads fit a similar narrative, with the three MBB firms again leading the way. Still, the overall picture is a bit more opaque at the lower rung. Deloitte offers fresh university hires a performance bonus of 15% of base salary, but only after the third year. EY also doesn’t give out annual bonuses to its most junior consultants, though it does pay time-and-a-half for overtime, which can certainly add up (or at least keep your hours down).
At the end of the day, the report suggests MBB firms pay new consultants around 10% more than the Big Four at both the MBA and undergraduate level. Two years away at business school is costly, but those who make it to the top consulting firms after graduation should be able to make up the difference somewhat quickly with their newfound earning power.
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