Is an MBA Worth It?

In an increasingly competitive job environment more and more professionals are seeking to make themselves more attractive by upgrading their credentials.  There is also a certain degree of “credential creep” that is part of this process.  If you’re not familiar with the term is basically refers to the idea that what formerly used to be considered an over-qualification for a job is now a prerequisite.  For myself this means slogging away at a Master’s of Education and Young is working on a Master’s of her own.  Ours would not be considered the most profitable of higher educational pursuits though – that distinction would likely belong to the vaunted Master’s of Business Administration or MBA.  So the question for many young people that are trying to find their way in a crowded workplace today is what is the return on investment for an MBA and subsequently, is it worth their time and effort?

A Personal Choice

There are a lot of financial decisions that will likely come into play when you look at if doing an MBA is right for you.  First and foremost is probably the upfront cost.  I know several companies that will foot part of, if not the whole bill for an MBA.  It’s pretty stuff to say no at that point in my opinion.  You are making yourself more attractive to the company, plus they are sinking money into you so from their investment standpoint they don’t want to lose you purely for that reason.  It’s like if you have two quarterbacks who are equally good but one gets paid a lot more.  Guess who gets the start? (Unless you’re like my beloved bombers and then everyone is equally incompetent and/or fragile so the decision doesn’t really matter.)  Another consideration for young people is how much debt they have on their personal ledger.  If you already have several years of post-secondary studies behind you and you followed that up with a few years at sub-par wages because it’s an employer’s market, then you likely still have some fairly substantial student loans to pay off.  Adding to this burden can make it appear very unattractive, and is definitely something to consider.

Paying For “Who You Know”

Is an MBA worth it?One interesting fact that continuously came up when I was reading both American and Canadian articles on MBAs is the idea that the most valuable thing you will get out of the experience is not knowledge or even the credential – but instead the connections.  Now I should point out that several people were dubious about the value in making connections with a bunch of other people who were trying to make connections and climb the same ladder you were.  There are definitely some programs out there that make a strong pitch in regards to their alumni being available for resources and help if need be.  I had never thought about that viewpoint of a MBA before.

I came across a couple of interesting perspectives on MBAs when I was doing a little research in order to answer the question of “Is an MBA Worth It?”  Anna Ivey from the University of Chicago states, “If [an MBA] is something that you're doing because you want to make more money, rather than because you're really interested in how businesses function, you'll probably be disappointed,” she says.  This probably isn’t what you wanted to hear if you thought that hitting the books for a couple more years was going to be your ticket to the top.  For a Canadian perspective I defer to Henry Mintzberg who is a professor of management studies at McGill University and author of “Managers Not MBAs.”  He blatantly states that, “The MBA trains the wrong people in the wrongs ways with the wrong consequences.”  It sounds like some of the courses available in the business stream mirror the complete disconnect we see behind theory and practice in the field of education.  It’s sort of amazing to me that these sort of scenarios can continue on, but there seems to be no shortage of demand for the programs so I guess there is little incentive to take note.

Canada's MBA Options

Canadian Business magazine actually has a brilliant breakdown of the top ten MBA schools in terms of return on investment .  You can find the complete list of the 39 MBA programs available in Canada here

Here is a brief summary of some of Canada’s more notable programs and their respective return on investment (measured by tuition cost vs immediate salary increase upon graduation):

  • McGill comes in at #1 in the ROI department which is not surprising considering their sterling reputation.  While Canadian Business reports that the cost of an MBA there is considerable at $65,000, in 2011 their grads seen an astounding salary increase of 129% to an average of $112,000.  This definitely made me sit up and take notice.  The school also notes that several opportunities to study abroad are available.
  • Studying an MBA at Dalhousie University will provide you with more than just a smattering of East Coast charm and people skills.  Their graduates go from $33,000 upon entry to an average of $67,000 for an increase of 103% for those of you keeping track at home.  The school pointed out that in 2011 over 80% of the graduating class were offered jobs before graduating.
  • If you’re an Ontario person and don’t mind driving a little within the GTA then DeGroote business school based out of Hamilton offers a respectable 91% ROI.  Tuition will cost $35,225, but the exiting salary is over $66K.
  • If tuition is a major factor for you that consider the University of Saskatchewan’s Edwards School of Business.  Students entered the school with an average salary of $40,000 and left around $72,000 mark, but the most impressive thing is that this world-class education only costs $24,520.
  • One final option that is fast gaining traction in the Great White North is going online to get your MBA.  I can vouch for the flexibility of online courses being a major positive, especially when you are trying to work at the same time.  The MBA program at Athabasca University is one of the leaders in this field with over 900 current students and boasts that it was the first online MBA in the world.  This program costs a very competitive $44,000.

A Reality Check (As Opposed to a Pay One)

I have to admit that while McGill’s numbers caught my eye, and the experience seems kind of fun in a geeky educational way, I was a little shocked by the relatively low salaries at many of these schools (both income and outgoing).  I always figured the business guys in suits made quite a bit of money (how many years of payments is the BMW amortized over anyway?).  By comparison, a Manitoba teacher with their Master’s of Education degree and 10 years of work experience would have come in around $85K automatically in 2011.  If you’re in administration of any kind those salaries jump substantially.

 Having a Plan

It seems that there were far more successful reviews of MBA programs across Canada from people who went in with solid goals for their degree and plan put in place to take advantage of the credential once they had gotten it.  As I mentioned earlier, another major focus for people who got the most out of an MBA was building a solid support group of contacts from instructors, alumni, and other students.  It never hurts to have friends in high places I guess.  Trying to answer the original question isn’t as easy as I thought it would be frankly.  If you have to sacrifice a couple years of work in order to pay a large tuition and don’t foresee a direct connection to a major increase in compensation, I wouldn’t hesitate to hold back on an MBA despite the fact that you might easily be capable of completing it.  There might be other education paths or areas to invest your energy in that yield better results.  Like most things in life, if you can get someone else to pay for it you’re golden.  Beyond that, if you’re playing with your own money and not the house’s, I would definitely sit down and calculate out a personal cost-benefit scenario before committing to anything.


  1. Jordann @ My Alternate Life on October 4, 2012 at 1:08 pm

    I’ve got my undergraduate degree in business and I’m definitely underwhelmed about my career prospects. As a result I’ve been considering an MBA as a potential upgrade to my credentials. I’m not entirely sold on the idea yet but I do know that I’m not happy with my potential income at this level of academic achievement. Thanks for giving me another article to consider in my research.

  2. Teacher Man on October 4, 2012 at 10:07 pm

    I was really surprised at what many business undergrad students actually make. What about changing geographical location, is that an option Jordann?

  3. Savvy Scot on October 5, 2012 at 2:49 am

    In my opinion, MBAs are only worth it in certain situations. I think that you have to have a career in mind where it will give you a head start and justify the money and time it takes to complete!

  4. popthoughts on October 5, 2012 at 11:02 am

    I think too many people jump into doing an MBA way too soon. To get any real value out of it, one needs to be in the workforce for a while so they can apply what they are learning. Also, business and management isn’t for everyone. I would like to do my MBA, but with a mortgage, kids, and working for a startup make it nearly impossible. Instead I have found other very good “MBA like” courses that I can take on my own time (and my own money). My two cents.

  5. Joe on October 5, 2012 at 6:09 pm

    The MBA is meant for executives and managers who have no formal business training but who are currently managing others and want to hone their craft.

    I have a BBA and have reviewed the curriculum for a couple Canadian schools; while there are some advanced courses available (depends on the school and faculty), a person could select courses so as to get through an Executive MBA or even a 2-year MBA while only learning the topics covered in the first 2 or 3 years of a BBA, simply with more focus on practical application.

    Henry Mintzberg, who one might be lucky enough to study under if one were to attend McGill’s program, wrote a really great book called “Managers NOT MBAs”.

    Does it pay off? Totally depends, but I think that return is narrowing. It’s best if you’re in the MBA’s original target group — an established manager with experience — rather than cash-hungry universities’ target group: indebted perma-students who have undergrad degrees and want a “marketable” degree. Again, without experience, you’d be better off getting a financial education from some part time community college courses. If everybody had an introductory micro-econ half credit and a financial accounting course, our society’s financial literacy would be improved ten fold.

  6. Teacher Man on October 6, 2012 at 6:01 pm

    Hey Joe. Great comment. I actually read about that book when I was looking up some stuff for the article. That make’s a lot of sense. Interesting to read his comments when McGill’s program actually looks like a pretty good deal. I completely agree on the econ 101 and accounting (accounting is probably the weakest part of my own financial background). In fact, I am routinely campaigning for a personal finance class at the high school level in my province. Certain math curricula sort of dabble at the edges of some personal finance concepts, but it seems so common sense to me that there should be a full mandatory course dedicated to these important life skills. Then again, looking at the public education sector somedays we’d probably find a way to screw that up too!

  7. Teacher Man on October 6, 2012 at 6:03 pm

    Did you compare the Athabasca option to some other MBA-like courses popthoughts? Also, if making connections is the main benefit of the program, could you achieve these goals through cheaper options? Good luck keeping all of those balls in the air btw!

  8. masculinist on October 10, 2012 at 8:25 am

    Read Business Model Generation, Personal MBA and Wall Street MBA. You don’t need to spend 1-2 years of lost time and lost income PLUS $50-$100K in debt to get educated. You just spend money on library book fines (to borrow a line from “Good Will Hunting”).

    There’s a chicken/egg dilemma – were those who got MBA’s successful because they already had experience or had drive to excel? Yes, MBA provide contacts…but do you have to spend $100K to network??

  9. Teacher Man on October 10, 2012 at 4:53 pm

    Love that line from Good Will Hunting (in fact that movie is one of my favorites of all time). I completely agree that the average person could educate themselves adequately with a library card of a couple hundred bucks on Amazon, but that’s not why we attend any post-secondary education at the end of the day is it? The second part of that quote is that the guy with the Ivy league education will still make out pretty well just because he has a shiny credential, and I guess that is ultimately what we are paying for. A hundred Gs does sound like a pretty steep rate just to meet smart and ambitious people…

  10. Richard on September 16, 2013 at 3:56 pm

    I am looking into doing an MBA from Athabasca but something about the school doesn’t sit well with me (perhaps i’m just old fashioned). My question is: if i do earn an MBA from Athabasca will I have any less opportunity than someone who did it from a brick an mortar school?

  11. Teacher Man on September 16, 2013 at 11:22 pm

    Hey Richard, I would say the real opportunity you’re missing out on is all of the networking opportunities that would come with getting an MBA in the more traditional way. I think Athabasca is pretty well respected around Canada, but the people I talk to claim that networking is half of the reason for doing it.

  12. Ravi Teja on December 18, 2013 at 5:30 am

    Actually I had completed my Btech and i want to either MBA or MS in canada or USA.Can u tell me which is better for the future and also which place is better to do it

  13. Kyle on December 18, 2013 at 8:15 pm

    Such a personal question Ravi. Without know more about your personal situation and where you plan to work after you get the degree I couldn’t even begin to guess which would be best.

  14. Jessyka Rabbit on January 17, 2017 at 9:15 pm

    Some of you are wondering about the MBA at Athabasca University. I am currently taking it and have 3 courses left. It is a rigorous program and there is the option of going Applied Project or Course Route. Once you compete the core courses and the Comprehensive Exam you are set to go to take Electives of your choice. If you already have a Business Degree, there is an Accelerated route whereby you are exempted from some of the core courses and there is no Comprehensive Exam. Due to this accelerated route, the overall tuition is substantially reduced. If you are interested in AU, go to their Faculty of Business site and register for an online information session where you will be able to hear about the program and ask questions. Personally, AU’s online delivery model is perfect for me. I am able to work full-time, manage family and take advantage of being able to complete the courses anywhere at anytime of day, evening or night. I don’t have to drive to a brick & mortar school, pay for parking and sit in a classroom. The professors and coaches they hire are experts in their fields, often with a PhD or MBA. The support staff and Help Desk staff are also great to work with.

Leave a Comment