If you attend a top business school, you can expect to earn well over six-figures during your first year after graduation in almost any industry. New salary data from Harvard Business School shows that the only 2018 graduates to not earn over $100k entered the government or non-profit sector. But where can you earn the most?
As you can see in the chart below, fresh MBA grads from Harvard who took jobs in private equity, consulting and at hedge funds earned the same average base salary – $150k. Those who entered investment banking take home an average salary of $125k, though they received the largest median signing bonus of $50k. Investment bankers and consultants were also much more likely to receive a signing bonus. Roughly 94% of each cohort were given a bonus after accepting an offer; those percentages dropped to 33% and 27%, respectively, at hedge funds and private equity firms/VCs.
However, investment bankers reported receiving no other guaranteed compensation, typically in the form of perks like company cars and guaranteed bonuses that are written into employment contracts. This is where hedge funds and private equity firms can differentiate themselves from investment banks and consulting firms, but also from each other. Median non-signing bonus compensation at hedge funds was a staggering $150k, though only one-third reported receiving anything. Other guaranteed compensation at private equity firms and VCs averaged around $84k for the 21% who were fortunate enough to get a sweetener.
If the numbers tell us anything it’s that most MBAs who work in private equity, investment banking, consulting and at hedge funds earn around the same during their first year. However, there are a handful of hedge funds and private equity firms that roll out the red carpet for new MBA grads, or at least those from Harvard. With potential signing bonuses and other guaranteed compensation, a first-year hedge fund employee can earn well over $300k, and that doesn’t even include performance bonuses.
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