In recent years, a common refrain on education has been that a master’s degree is the new bachelor’s degree. Nearly one in five college students choose to enroll in a graduate program as their first destination after college, according to the National Center for Education Statistics (NCES). In part, this drive to further education is because college grads are competing for low-level jobs against people with decades of experience. Is grad school really worth the stress?
In 2019, 41.3 percent of all recent college graduates found themselves working in jobs that don’t require college degrees as reported by the Federal Reserve Bank of New York.
This “underemployment” trend has persisted for the past 10 years with occasional dips up and down, but the case remains: college students continue to be pushed for ways to distinguish themselves on the job market.
Many students are taking the leap into a master’s program without thinking about alternatives or costs. After all, grad school easily presents its upsides — those with a master’s degree on average earn 16.6 percent more than those with a bachelor’s degree as reported by the U.S Bureau of Labor Statistics. But with higher earnings often come higher costs.
As an admissions coordinator for a time, I cringe whenever I have to explain to an eager applicant that tuition could cost nearly $80,000 with no opportunities for graduate assistantships and very few scholarships. In fact, 60 percent of all grad students leave their programs with on average $67,800 in debt according to the NCES. Without adequate planning, enrolling in grad school could leave you in a very sticky situation.
Yet I know our program has value. We’re in a new tech field, offer paid internships that cover the majority of tuition, and are accredited to a well-known school. The average fees students pay for grad school amount to $25,442 as reported by NCES, not counting the cost of living or the time that could have been spent working. For that price, is grad school really worth it?
When Is Grad School Worth It? Finding the Right Reasons
First, you must assess how the program will fit with your career path. Second, decide if the program is worth the price — think like a hiring manager. This will help you avoid falling into the grad school trap. Plan out how you can pay for grad school.
The federal student loan grace period is a mere six months after you graduate or drop out. Even freshly armed with a master’s or Ph.D., some students may find themselves struggling to secure a job, while interest payments keep piling up.
For example, a friend of mine wants to get her graduate degree in teaching after three years of temp work. While it will open up more opportunities and advance her skills, going for a master’s may not be worth it because potential employers are required to pay more for teachers with advanced degrees than for those with bachelor’s degrees.
While this sounds good on the surface, it might also deter somebody who would otherwise love to hire her.
If my friend were a full-fledged teacher and employed full-time for a few years (perhaps having tenure at the school), the reverse would be true. She would already be on track for a promotion or a raise. Therefore, grad school would be worth it for her career path. It would be a continuation of her career, rather than an add-on to an unstable job.
“It’s that experience plus the [higher] education that makes a differentiator,” says Kurt VandeMotter, a senior recruiter at Linked Executive Search, ranked number nine on Forbes list of Best Executive Search Firms.
“In most cases, it’s best to wait a couple of years,” VandeMotter continues. “Go get some real life experience, and then come back and get your master’s degree.” The key is timing — its young professionals who already have two to three years of work experience and later choose to attend grad school that “get the most value.” Meaning, “what you’re worth on the market is much higher than it was before you got a master’s.”
Moreover, working professionals in business who want to go back to school can sometimes get their employer to subsidize — or fully cover — the cost of pursuing a master’s degree.
“Very often there are companies that [are willing to invest in] young people in their leadership programs, and are looking to hopefully keep that candidate around for a long time,” VandeMotter adds. This investment can be financial in nature, or simply allowing that professional to take time off to complete a graduate program, or a combination of both. “In exchange for that,” “companies expect you to stick around for a while. If you try to leave the company within a certain period of time, generally two to three years, then [often] you are responsible for paying back the cost.”
Of course, this experience differs from industry to industry, says VandeMotter: “In business, you see it a lot more often than you do in most professions. [But] teaching, for instance, you’ve got to figure out [that cost yourself]… Medical, being the same thing.”
Sylvia Lawrence, a hiring director at a Fortune 500 company adds: “Employers want to see linear movements.”
Again, timing is key. “Changing careers is great, but unless you can prove that you have thought it through, made plans, and have the basic skills and experience, your graduate degree looks like you took the easy route,” says Lawrence.
In other words, it makes more sense to pursue an advanced degree when you can use it to make yourself more valuable to your employer.
Placing a Value on a Graduate Program
Graduate schools are no longer rigid in class schedules and offerings. A great graduate program will offer part-time options over extended periods. Night classes allow you to keep your job while improving your credentials.
The most popular fields in which to get a graduate degree are overwhelmingly business, education, and health and related programs, according to data from the NCES. And there are amazing online education grad school programs that are actually worth the money.
Are you a busy professional considering taking your career to the next step? Think about applying for a flexible part-time MBA program that allow you to get your master’s degree while working.
MBA programs at Carnegie Mellon University (Tepper) and University of Southern California (Marshall) follow a flexible online-hybrid learning environment where students can take classes remotely during the week, and attend in-person classes on weekends. Take a sneak peek: You can join in on an online evening class at CMU Tepper — make an appointment here!
Looking for a fully online MBA experience? About 97 percent of the students at Pennsylvania State University (World Campus) are already working in the field as they study, and can therefore make up the difference in cost. All three schools are accredited by the Association to Advance Collegiate Schools of Business.
For experienced teachers with five or more years under your belt, this may be the right time to pursue a master’s of education.
University of Virginia (Curry), among the top public universities, offers a flexible option of a part-time five-year program or full-time two semesters and one summer. UVA Curry offers master’s of education degrees in Administration and Supervision, Curriculum and Instruction, and more.
Those who want the full university experience should also consider the reputation of the when deciding whether grad school is worth it. Prestige may seem like a surface level consideration, but prestigious schools also often have more developed networks with more alumni that may work in the industry or company you have interest in.
Where you go to school matters, especially for business or law. Comparing Wharton with a “low-level” school could mean a difference of hundreds of thousands of dollars in potential future pay. Wharton MBA graduates command a median of $150,000 per year.
Compare that to a smaller, lesser-known school like Willamette University’s Atkinson Graduate School of Management, where the average salary is only $65,311.
Current Tuition vs. Future Salary
Compare the price you pay now with the salary you’ll be earning in the future. For many potential graduate students, tuition is the main determining factor in whether grad school is worth it. For those who can’t afford to shell out over $100,000 for an MBA or roughly $200,000 total for a top-tier master’s program, a state school is always an option.
One great example is the University of Houston. For an in-state student at Houston, tuition is $41,572.32 for a master’s in business, but a graduate commands an entry-level salary of $81,063 with a yearly bonus of about $8,750.
These programs are often the same quality as those at private schools. For instance, both the University of Illinois and University of California, Los Angeles, have automatic name recognition.
Some fields, like biotechnology and engineering, require advanced degrees. Without a master’s, you might not qualify for management positions or other promotions.
Top schools such as the Massachusetts Institute of Technology, Stanford, and the California Institute of Technology offer a great education, prepare students with skills over fluff, and have job placement to match tuition cost.
MIT’s students paid $53,790 in tuition for the 2019–2020 school year. However, those completing their highly sought-after engineering program have a mean salary of $119,473 and an 82 percent full-time placement rate in the field.
On top of this, the entry-level salary difference between having a bachelor’s and a master’s is huge.
Those with a master’s degrees earn a weekly salary of $1,833 compared to $1,497 by those with a bachelor’s according to the Bureau of Labor Statistics. If you multiply that by 48.6, the average number of weeks a person works per year as stated by the Pew analysis of Labor Department data, that’s approximately a $12,101 yearly difference.
Is Grad School Worth It or Not? The Bottom Line
Realistically, there is some value in almost any graduate school. This is especially true for people who are looking for jobs that require a specialized education.
Grad school may also be worth it for those who want to move up in their careers, or who plan to change direction without needing another four-year undergraduate degree. The long-term value of a program that matches your goals and offers great return on investment shouldn’t be underestimated.
Additional reporting by Alice Yeung.