An MBA is a huge investment, with the total cost — including two years of lost earnings — at an elite US business school such as Harvard or Wharton priced by some estimates at more than $300,000. But a one-year MBA program in Europe such as at INSEAD will give you a much faster payback, as you will spend less time out of the workforce — and pay for only 12 months of tuition.
Forbes has ranked the top one-year MBAs based on payoff. The US magazine compared graduates’ earnings in their first five years out of business school to the opportunity cost — forgone compensation, tuition and other fees — to provide a “five-year MBA gain”.
According to the survey by Forbes of more than 17,000 MBAs around the world, the top-10 one-year non-US MBA degrees produced a five-year MBA gain of $126,000. The top two-year programs outside the US provided a gain of $74,300, and the very best US courses had a five-year gain of $73,400.
IMD is the world’s best one-year MBA based on return on investment (ROI), according to Forbes, up from second place the last time Forbes published its biennial ranking, in 2015. The Swiss school provides a five-year gain of $194,700. Students have an average of seven years’ work experience. The longer time in the workforce means higher forgone salaries — $81,000. IMD also has the highest cost for a one-year program — $88,000 — because of mandatory fees for trips abroad, teaching materials and more. But the payoff remains huge.
IMD MBAs have a median salary of $215,000 five years out of school, $26,000 more than any other non-US program. IMD graduates earned back their investment in just 2.3 years on average.
INSEAD is the second-best one-year MBA with a five-year gain of $150,400, according to Forbes. The payback period is only 2.7 years thanks to salaries of nearly $190,000. IE Business School of Madrid is third, based on a gain of $145,400.
The one-year model is ubiquitous in Europe, whereas US business schools have largely stuck to the two-year model. But there are signs that the one-year degree is gaining in popularity among MBA candidates globally.
Fewer than half of US schools received an overall increase in applications last year, according to GMAC’s annual application trends survey — the third straight year of declines — although GMAC puts this partly down to the US political climate. But the majority of programs in Europe grew their applications.
This summer, the University of Iowa’s Tippie College of Business in the US said it would shutter its two-year MBA course to focus on shorter masters programs.
If, like a growing number of MBAs, you plan to opt for the latter, here are the 10 best one-year international MBAs based on ROI: