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Doctorate in Business ROI

Written by Mary Blowers
Last Updated: October 8, 2020

After earning a doctorate in business, students may be able to secure advanced management and administrative roles, but those higher-level degrees come with steep costs. While it's tempting to focus only on the potential salary gained from a doctoral degree, students should consider several other considerations before starting a new program.

Other factors impacting a degree's return on investment (ROI) include net price, potential debt, time until graduation, earning potential, and missed income opportunities. Students considering a doctorate in business should make sure their prospective schools charge affordable tuition rates, ensuring manageable debt after graduation. Learners should also keep in mind how long it takes to graduate and how their income might change during school.

Learners should also consider their career prospects after graduation. For example, a doctorate in business qualifies graduates to teach in college and university settings. According to the U.S. Bureau of Labor Statistics (BLS), postsecondary business teachers can expect a 12% increase in occupations from 2019-2029 — significantly faster than the 4% projected average growth rate for all occupations nationwide.

That said, a doctorate in business does not limit students solely to professorship roles — these advanced degrees apply outside of academia as well. Depending on your career goals, an advanced business degree could be the right choice for you.

ROI Factor #1: The Doctorate in Business Degree

A doctoral business degree is a terminal degree indicating the highest achievement in the business field. Doctorates in business take about 3-4 years to complete depending on program requirements and internships. Doctoral business degree candidates can choose from a variety of specialization options, including:

  • Business administration
  • Business management
  • Applied management and decision sciences
  • Management information systems
  • Organizational management
  • Public policy and public administration
  • International business
  • Organizational leadership and management.

Business doctoral programs generally build on the studies of master's programs, so experienced students are well-prepared for the courseload.

Students pursuing a doctorate in business perform practical research, apply professional experience, and use business theory.

Doctor of business administration (DBA) and Ph.D. programs culminate in dissertations aiming to provide new insight on issues in the business world.

Advanced coursework can be difficult to balance with other obligations, but students enjoy flexible options for completing a doctorate in business. Some schools, like Walden University, offer exclusively online courses, while schools like the University of Florida offer hybrid models, which mix in-person and online classes. The cost of a business doctoral degree also varies by school, generally ranging from $20,000-$60,000 per year.

Do You Get a Doctorate in Business Administration or a Ph.D. in Business?

Whether you choose a DBA or a Ph.D. in business depends on your career path. The DBA best serves business professionals seeking to apply theoretical knowledge to the business world. The Ph.D. focuses on academia, benefiting those who aim to conduct research, publish, and contribute to education.

Comparing DBA and Ph.D. in Business Programs

Doctorate of Business Administration Ph.D. in Business and Management
Length 3-4 years 3-4 years
Focus Application of theory to the business world Contribution to research and education in business studies
Goal Advanced management and administrative roles Education, publication, and professorship roles
Annual Cost $20,000-$60,000 $20,000-$60,000
Prerequisites Master of business degree and/or demonstrable work experience at the managerial level Master of business degree
Student Demographics MBA graduates and senior business professionals Graduates from related master of business programs
Curriculum Methodology, management theory, development of research projects, dissertation, and final defense Methodology, management theory, development of research projects, dissertation, and final defense
Program Focus Address current business problems, focus on practical solutions, develop new business models Develop new theory, seek to answer business questions, bridge gaps of understanding, write for the purpose of publishing
Dissertation Generate a theoretical model that can be applied to the business world to solve problems or address specific needs Conduct research on business theory and seek to publish new findings and understandings

What's the Cost of Your Business Doctorate?

To calculate an accurate ROI for their business doctorate, students must first determine the net price of attendance, including tuition, educational expenses, potential scholarships, and all related costs. Tuition for a business doctoral degree depends on the school's prestige, course format (online vs. in-person), in-state or out-of-state status, and program length.

Related educational costs can also carry expensive price tags for full-time students. While pursuing their doctorates, students must finance their housing, educational materials, and other cost-of-living expenses. These factors are especially difficult to calculate because they vary by region and individual, so prospective students should determine the net cost of attendance before beginning a new program.

Some doctoral programs offer paid teaching or research assistantships, which cover tuition and even offer living-expense stipends.

However, these types of opportunities are more common for Ph.D. students. DBA students, who often come from the workforce, are more likely to pay for their education out of pocket. These students may balance work and school over longer periods of time, as well, ultimately driving up the overall cost of their degrees.

How Long Will It Take To Get Your Doctorate?

Students who enter their doctoral programs directly after earning a master of business are more likely to finish their degrees within the predicted range of 3-4 years. Conversely, students who have spent time gaining experience from the workforce before entering a doctoral program may take longer to complete their programs as they may need to balance school with other obligations.

Time and money are often equal investments in education, especially if investing time in classes means a loss of income for someone who is used to bringing in a comfortable salary. Longer time in school and greater investments in tuition and other educational costs may negatively affect the ROI of a doctoral degree.

ROI Factor #2: Ph.D. in Business Salary and Careers

Employability for a doctor of business depends on your course of study and specialization. Ph.D. graduates seeking roles in academia tend to compete for limited, well-paying professor and research positions. DBA graduates may enjoy more opportunities to apply their degrees, but they are not guaranteed increased salary potential simply for holding doctoral credentials.

That said, no doctoral degree can guarantee employment or increased salary potential. In some cases, universities may hire those with a Ph.D. to boost research capacity without actually paying them well. Likewise, DBA graduates navigating a difficult economic landscape may struggle to see returns on investment for their degrees. However, doctors of business administration whose studies solve specific business problems may see their degrees pay off quickly.

Available Careers for a Doctor of Business

Business careers can be competitive, but high-level degrees and work experience help prospective employees negotiate advanced titles and increased salaries. In fact, PayScale reports that professionals with a Ph.D. in business earn an average annual salary of $102,320. The BLS also projects positive job outlooks for many business careers.

Postsecondary Business Teachers

University professors in the business field instruct students on theory, methodology, management, and other relevant subjects.

  • Requirements: Tenured university professorships generally require a Ph.D. Candidates will also need to demonstrate high levels of competency through research and/or workforce experience.
  • Job Outlook: The BLS projects employment for postsecondary business teachers to grow by 9% from 2019-29, which is much faster than average.
  • Median Annual Salary: $87,200


Financial Manager

Financial managers utilize business expertise to create financial reports, direct investment activities, and meet the financial goals of their organization.

  • Requirements: A bachelor's degree with five years of work experience is typically required, but higher degree achievement and industry experience are preferred.
  • Job Outlook: The BLS projects employment for financial managers to grow 15% from 2019-29, which is much faster than average.
  • Median Annual Salary: $129,890


Top Executive

Top executives apply knowledge of their industry to plan strategies and policies and ensure organizations meet their market goals.

  • Requirements: A bachelor's degree with five years of work experience is typically required, but higher degree achievement and industry experience are preferred.
  • Job Outlook: The BLS projects occupations for top executives to increase by 4% from 2019-29, on pace with the national average growth rate for all professions.
  • Median Annual Salary: $104,690


Negotiating a Salary Increase After a DBA

Doctors of business administration who plan to return to the workforce after graduation should cash in their new degree to see an ROI.

According to PayScale, the average difference between an MBA salary and a DBA salary is more than $20,000 per year, so graduates may feel reasonably entitled to ask for a raise.

However, the negotiation process may vary depending on employment factors.

Some employees stay in their roles as they go through school, possibly with reduced hours or job duties. For employees who previously communicated their intentions to their organizations, the doctor of business administration salary negotiation process may happen naturally following graduation.

However, DBA graduates seeking to move up within their organizations or find employment elsewhere may need to sell employers on the attributes of a high-level business degree. Since having a doctorate does not guarantee a salary increase, postdocs should emphasize their educational assets in every negotiating opportunity.

Other ROI Factors for Doctoral Degrees

Aside from the net cost of attendance, each of the following considerations may impact the ROI for a doctorate in business:

  • Lost Wages: Students who leave the workforce to return to school must plan for lost wages during the school term, which can be especially difficult for those with financial responsibilities, such as a mortgage, student debt, or dependents.
  • Likelihood of Matriculating: The doctoral application process can be lengthy and sometimes expensive. Make sure you have been accepted into a program you can realistically complete before making any major life changes.
  • Student Loans: Learners who take out loans to finance their education must secure sufficient salaries after graduation to repay them. As a general rule, avoid taking out more in loans than you would make in a year of postdoc salary.
  • Lost Investment Opportunities: Paying for education is an investment in your future, but it carries a considerable cost, potentially leaving little extra to invest in property, retirement, stocks, or bonds.
  • Economic Conditions: The BLS projects positive job growth for many business careers, but you aren't guaranteed a professorship or a salary increase after graduation. Economic conditions and job prospects may significantly impact ROI.
  • Intangible Factors: Students must consider the intangible benefits of education, which may include gaining industry knowledge, building new skills, and networking. Conversely, additional stressors like school-work-life balance and burnout may detract from your investment.

Calculating the ROI of Your Doctorate in Business

Before calculating an accurate ROI, students should determine realistic education expenses. The cost of a doctoral degree varies depending on school prestige, location, and type of instruction. Individual costs may also differ based on program length and student loan debt.

Learners should also research Ph.D. in business administration salary and employment data for their respective regions. Examine the job market for your intended career path or determine whether your current organization will promote you once you've obtained an advanced degree.

Graduates can apply the basic ROI equation to estimate their average ROI for their first year after graduation. They can use their expected first-year salary as the current value of investment and collective tuition expenses as the cost of investment. This equation is:

ROI = (Current Value of Investment – Cost of Investment) / Cost of Investment.

For example, if a graduate earns PayScale's reported average salary for a doctor of business ($102,320), chooses a moderately priced school at $25,000 annual tuition, and takes four years to complete their degree: 2.3% = ($102,320 – $100,000) / $100,000. In other words, in their first year after graduation, this professional should see an average ROI of 2.3% — a small but positive return on their investment.

This equation unfortunately does not include living expenses, loss of income while in school, or interest on borrowed loan amounts. You must determine the net cost of attendance for your school and factor in your own personal needs to calculate an accurate ROI.

So, Is a Ph.D. in Business Worth It?

Ultimately, only you can decide if pursuing a doctorate in business is the right choice. Investing in education can bring invaluable industry knowledge and networking opportunities, not to mention the chance to research an issue of interest. However, doctoral degrees can be time-consuming and costly, and they do not guarantee high-level positions or salaries.

If you already make a decent salary and would need to forgo your income and take out substantial student loans to finance your education, your ROI might be negative. However, if you value the intangible benefits of education and can reasonably afford the net cost of attendance without incurring too much debt, a doctoral degree can be a worthwhile investment.

Finding the Right Ph.D. in Business Program

Calculating potential ROI is an important research step, but prospective students should also analyze other factors that may affect their academic success. When selecting a school or doctoral program, consider each of the following:

  • Student-to-Teacher Ratio/Class Sizes: Schools with smaller class sizes tend to offer more peer support and individualized attention from faculty.
  • Style of Instruction (e.g., Online, In-Person, or Hybrid): Students who prefer traditional educational settings might seek out in-person doctoral programs. Likewise, learners who need flexibility and autonomy may prefer online coursework.
  • Available Concentrations/Specializations: Learners who know how they'd like to apply their doctoral degrees in their careers should look for programs with relevant concentration offerings.
  • University Resources (e.g., Tutoring or Career Services): Some schools offer services to help students boost the quality of their work and create individualized career plans.
  • Alumni Networks: Institutions with robust alumni networks may offer students more and better professional connections.

Weighing these financial, academic, and environmental factors might seem overwhelming, but doing your research can help you determine which school best fits your preferences and needs. You can get a jump-start on your college search by looking into school rankings and write-ups, such as those offered by TopManagementDegrees:

Frequently Asked Questions

How long does it take to get a doctorate in business?

A doctorate in business takes 3-4 years to complete depending on program requirements, internship stipulations, and style of instruction, among other factors.

What is the difference between a Ph.D. and a DBA?

While the Ph.D. features an academic focus and aims to conduct research and educate, the DBA concentrates on the professional side, seeking to apply theoretical knowledge to the business world.

What kind of job can I get with a doctorate in business administration?

DBA graduates can apply their knowledge to a variety of career paths, including university professorships, top executive roles, financial management, and operational director roles.

How much can you make with a Ph.D. in business?

For a Ph.D. in business, PayScale reports the average salary as $102,320. This number may vary by specific industry and work experience.

Is a doctorate in business worth it?

A doctorate in business may be worth the investment, especially if your aspired career path requires or prefers a high level of academic achievement and offers a substantial salary.

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