Employers Value Masters More Than Ever
Employers value Masters degrees higher when recruiting young professionals, especially after the 2008 financial sector crisis. A Masters opens up prospects for a better starting salary and position, as well as faster career growth.
More than 8 years have passed since the beginning of the Global Financial Crisis, and some would argue that the worst is already behind us. But even if this is true, the effects of the severest economic crisis to have struck the globe since the Great Depression of the 1930s have left a permanent burn mark on the socio-economic landscape. Years of financial volatility and labour market stagnation have taken a heavy toll on the younger workforce, the most obvious consequence being that a Bachelor's degree no longer wields a competitive edge in the battle for employment.
A new reality for young job-seekers
The most enduring effect of the Crisis on the labour market was not the immediate contraction that saw employers freeze salaries and cut jobs, but rather the cumulative consequence of workforce oversaturation.
As the already shrinking labour market began filling with professionals who had lost their jobs, millions of young college graduates around the world saw themselves unable to find work because of their inexperience. Bachelor's degree holders could not compete against the experienced professionals who had been made redundant in the immediate aftermath of the Crisis.
In an avalanche effect of generational proportions, many turned to postgraduate education to plug the gap. The assumption was that this one- or two-year period away from job hunting would allow them entry into the workforce, or at the very least buy time for the economy to improve.
"Focusing on the education sector, it seems that the demand for education increases because individuals try to circumvent the tight labour market," a report by the Vienna Institute of Demography (2010) from that time claims.
Postgraduate numbers expanded considerably, "with targets for recruitment being surpassed", states another report from the same year by the Organisation for Economic Co-operation and Development (OECD). "This is particularly marked for full-time taught MA and MSc degrees. In some faculties, such as Business, there has been a rise of 75% of overseas students in comparison with the intake for 2008," the report says.
But as students began pouring back into universities, it became clear that those left behind would have an even harder time getting a job, while those opting for an extra degree would have to face a new reality, in which the playing field had once again become even. However, "even" should not be mistaken for easy, because the Masters degree has consequently, and inadvertently, become the new Bachelor's.
All's well that ends well
As sombre as parts of this story may sound, getting a Masters degree is a remarkably solid investment idea, as demonstrated by numerous reports and studies.
According to the latest ranking by the Financial Times (FT), indicating employment levels of Masters in Finance (MiF) alumni three months after graduation, 70% of students who previously had no work experience had managed to land a job in this time period. Students with previous work experience score even higher, with four out of five people firmly employed within three months of graduation. It is worth noting that these statistics come from universities themselves, and only reflect alumni of whom the schools have been able to keep track. This means that the data only covers real individuals, and not coalesced data.
Check out: A Masters Degree Matters
Furthermore, the median salary for the top 100 schools in the FT rankings for Masters in Management (MiM) students is 58,000 USD per year. For Masters in Finance graduates without prior experience, that number is even higher, at roughly 65,000 USD, and highest, at 94,000 USD, for MiF students who entered the programme having acquired some work experience beforehand.
With all this in mind, it is safe to say that these numbers paint a very conclusive picture. They reflect the success of the Masters degree in delivering on its main promise, that is, to be a persistent cure for unemployment and an antidote to the workforce oversaturation quagmire explained earlier.
What is more, a 2016 GMAC report on the outlook of future alumni suggests that the annual salary growth rate of Masters in Accounting (MiA) graduates is the highest in a scale that includes MBA programmes and other Specialised Masters degrees, sitting at 10.6%. The second highest is another Masters programme – the Masters in Finance, at 9.4%. The Masters in Management degree is in a respectable fourth position, with a 7.6% growth rate. But even more intriguingly, all three Masters programmes are able to completely pay off the financial investment in less than two years – just over a year and a half for MiF graduates, 1 year for MiM graduates and less than a year for MiA graduates. Finally, the three Masters degrees also provide the biggest salary boost on record, with an incredible 45,000 USD raw increase for MiA graduates.
The path of the Masters
But what does a Masters degree actually teach? And besides the positive statistics, what does the Masters really offer students in order to justify these numbers? If the Masters is truly the new Bachelor's, what kind of skillsets do employers expect to see from young job-seekers?
A Masters degree is designed to instil specialised skills. The focus is firmly on hard, technical skills, which help the graduate to be highly proficient in the workplace. A combination of theory and practice leads to the acquisition of skills that are both universal and highly applicable. In all examples, universities partner with local businesses to provide a real-world environment for those skills to be tested, while still on campus.
"Knowing theories is not enough; we need to apply them creatively. We worked with real companies on projects ranging from a marketing campaign for a winery to our consulting project and the Google Online Marketing Challenge competition," says Marie Berriet, a student who graduated from Hult International Business School with a Masters degree in International Marketing.
In Marie's case, as in all others, students learn how to practise a profession. For instance, a Masters in Financial Economics "can lead to careers in asset & risk management, trading, corporate finance, banking and auditing & management control", as EDHEC Business School claims.
Check out: Making a Difference with a Masters Degree
Simply put, a Masters degree does exactly what it says on the tin – it transforms students into masters of their craft. It comes as no surprise, then, that the Masters is the preferred choice for employers looking to entrust their businesses to young professionals. This is especially true when employers are faced with the other alternative – the Bachelor's degree holder, who has acquired a broader understanding in their field, but not so many of the specialist skills required to do a particular job extremely well.
Finally, the diversity that students encounter, particularly in international Masters programmes abroad, often proves to be a cherished experience when they enter the labour market, since it provides them with an enriched outlook on the world.
According to Graduateland, "it's no secret that international experience is highly valued by employers in practically all industries, regardless of whether you've been working, studying or doing an internship abroad. In an increasingly interconnected world, the capability to work effectively in a diverse workplace is vital."
"Employers will be impressed by the fact that you have moved outside your comfort zone, particularly if you have undertaken paid or voluntary work or overcome any challenges during your trip," The Guardian suggests, in an article dedicated to the topic of international exposure.
For many working professionals, this international experience remains a chimera, since it means that they would have to take precious time away from work to attain it.
However, for international students who have the luxury of time, the Masters offers an all-in-one solution that readies them for the requirements of the modern labour market in ways that a year or two in an entry position, devoid of real responsibilities and opportunities, never could.
This article is original content produced by Advent Group and included in the 2016-2017 annual Access MBA, EMBA and Masters Guide under the title “Master’s is the New Bachelor’s”. The digital guide file will soon be available for download.