Thinking about how advanced degrees can boost careers and earning power, I am reminded of Warren Buffett's wise observation: "Price is what you pay. Value is what you get." Indeed, an advanced degree doesn't have intrinsic value; value depends on what you can get out of it. An advanced degree is like a fancy golf club-expensive and worthless unless you know how to use it.
The Dollar Value of Your Degree
A few years ago, MSN Money tried to put a dollar amount on graduate education by comparing pay rates for specific degrees. What they found was that not all degrees are created equal. Medical doctorates were worth almost one million dollars, while liberal arts or social science master's degrees were worth zero. An MBA was valued at $376,000 and a master's in engineering came to $326,000.
David Kemper, principal of the business growth strategy consulting company Kemper Strategies, supports the idea that advanced degrees are worth real money. "I earn 50 percent to 100 percent more per year, with nearly all else being equal. We live in a credentialed society," he says.
A degree is a seal of value and reduces perceived risks in hiring.
The Other Factors that Determine Value
These calculations don't quite get to the nuances of value. Value varies by the school and the industry. The quality of the job you are able to land after graduation is a key value driver, so strong recruiting in your target industry is a must. Dawn Leijon, a working marketing professional and adjunct professor at Georgetown says, "The value of a business school is largely in the school's ability to attract employers who can 'make the market' for MBA grads. I wanted to go into marketing for a food company after graduation so I focused my b-school search on schools in the Midwest, which is where many food companies are and where the schools tended to have strong relationships with those companies. Likewise, if you want to work in Silicon Valley, Stanford is a great choice."
The Value of Intangibles
Getting a great job that pays well is only the beginning. Many people cite the personal growth they experience learning new subjects and new methods as one of the most valuable aspects of their degree. Almost everyone talks about the quality of their expanded network, and the access they have to people who can help them throughout their careers.
"The confidence and network are probably the most important intangibles." says Jose Li, who earned his MBA from Carnegie Mellon's Tepper School of Business, a top 20 business school. He particularly appreciated "meeting and interacting with colleagues and future business associates from countries throughout the world and the exposure to c-level executives."
What Value Means for You
Getting value from your degree depends on getting the right degree from the right school for the right industry. Then, you have to meet the right people and get the right job. If all goes according to that plan, the cost of your degree will be well worth it.
Lisa Merriam is the principal of Merriam Associates, a boutique branding agency based in New York City. Her expertise is in brand strategy, brand naming, brand identity, brand launch, copywriting and video production. She maintains a vlog and blog at www.merriamassociates.com and has written for publications such as American Bank Marketing, Apparel Magazine, China Business News, Sporting Goods Business and others.