Welcome to 2023, and our updated management consulting salaries report!
This is a big year: Charles III will be coronated as King of the United Kingdom and other Commonwealth realms, India is projected to surpass China as the world’s most populous country, the FIFA Women’s World Cup takes place in Australia & New Zealand, and the Cricket World Cup takes place in India.
It’s a big year for the consulting industry as well, as firms increased starting salaries substantially from 2022. What does this mean for you? If you can make it through the gauntlet that is consulting recruiting, it’s a great time to break into the industry. Comp is on the rise, and the lifestyle is actually better than it was 5-10 years ago. How? Travel is down, utilization is coming down from pre-pandemic highs, and salaries have soared. Put it all together, on top of the professional development and exit opportunities, and that’s a pretty great value proposition for consulting.
Nervous about the consulting recruiting process, yet convinced the career path is right for you? We can help (and do help thousands of candidates per year). Work with us through our editing package – we’ll rewrite your resume and build you a networking strategy. Already have an interview? Let’s execute a personalized prep plan through 1:1 coaching.
Now, let’s get into some of the consulting salary trends we identified this year. 2022 saw firms grapple with the tightest global labor market in decades as demand for management consulting services remained strong.
This led to record revenue for many consulting firms and a continued wave of M&A activity, leading to double-digit industry growth. However, this growth is not without potential peril. Future margins are at risk as firms continue to raise salaries without a commensurate rise in project rates. So far, margins have been protected by a decrease in operational costs (i.e., smaller office space, less travel). Still, there is only so much that firms can cut, and salaries keep rising (as you’ll see).
The potential result? Without the traditional increase in pricing power that industry consolidation brings, we may see firms begin to shrink project teams or prioritize the hiring of cheaper pre-MBA talent in the next decade. We believe the dramatic increase in pre-MBA salaries is a forerunner to this playing out in the industry over the next 10-15 years.
The M&A activity revealed two basic patterns. Large firms acquired boutique strategy houses in lieu of (or in addition to) organically building their own (e.g., AlixPartners acquiring Galt & Co.). Strategy firms acquired specialist players to continue to move further downstream into supply chain, sustainability, digital, and implementation work (e.g., Bain acquiring supply chain consultancy Proxima).
What do you get when you put it all together?
The Gap Between Top Firms and the Rest is Widening…
Established consulting firms drove a lion’s share of the overall industry growth through organic and inorganic means. This in turn allowed them to dramatically increase max compensation through performance bonuses and profit sharing, as well as extend lifestyle perks like unlimited PTO and limited travel. At the same time, while the rate of growth for boutique firms increased YoY, the proliferation of in-house strategy groups at large corporations continues to limit the growth of a fragmented market of boutique players.
…and the Staff are Getting Less Busy…
As the last two years of frenetic hiring catches up with the demand for services, overall consultant utilization has plateaued. Utilization has decreased at some firms from the all-time highs we saw in 2021 and early 2022.
…which will Increase Competition for Open Roles in 2023
Decreased utilization and a loosening labor market will lead to less open roles and slower salary growth this year. Why?
2021 and 2022 saw an unprecedented wave of exits from the industry – these exits should stabilize as utilization comes back to historical norms. Combine this with the fact that consulting’s biggest competitors for talent – Wall Street and Silicon Valley – are conducting layoffs and slowing hiring because of the rising cost of capital, and these factors will put downward pressure on salary raises headed into the 2024 cycle.
With more eager candidates than ever before chasing the prestige, pay, and relative stability of a consulting job, the consulting job market will be even more competitive this year.
How has this impacted consulting salary trends?
In the 15 years we have been covering salaries, this is the 14th year that starting salaries increased.
While most historical consulting salary increases were in the 2-4% growth range, this year’s increase was around 10%, signaling the effects of a tightening labor market and increased demand. This increase was on par with the last major increase we saw in 2019.
Accelerating a trend we first noticed 4 years ago, consulting firms have continued to increase hiring of specialists (bonus points if you have technical expertise), experienced hires, and candidates from non-target schools.
In fact, less than 20% of McKinsey’s most recent intake was made up of direct MBA hires, and the firm hired analysts from over 370 universities. Still, targets drove most hiring, so if you’re from a non-target school, network now and apply early.
Below are salary figures for those joining management consulting positions in 2023. The data comes from our interview prep clients who received written job offers and firm representatives. The salary data is for those recruited straight from an undergraduate, master’s, MBA, or PhD program or those that were hired at the same level. All salary figures are in U.S. dollars unless otherwise stated.
This is the only originally sourced data available in the industry. Everyone else uses ours or uses outdated or arbitrarily averaged Glassdoor salary data, PayScale salary information, or Indeed salaries. Use or republication of this data is prohibited without the express written consent of Management Consulted.
All of the data and our expanded insights are included in the full downloadable report – get a copy for free below.
Salaries for Incoming Undergraduate & Master’s Full-Time Hires
Overall, salaries for incoming undergraduate & master’s students have risen significantly compared to last year. When comparing consulting roles to those in industry at the same level, there are few better options when it comes to total comp. If compensation is the most important factor in your firm preferences, look at firms like Alvarez & Marsal, McKinsey, Strategy&, BCG, Bain, Accenture Strategy, and IGS. However, we recommend considering other factors in your search as well, including exit opportunities, firm culture, travel, and more.
Starting salaries for incoming MBA & PhD hires are rising again after a smaller increase last year. Outside of finance, post-MBA compensation packages are the highest in consulting out of any industry. Not only are finance and tech slowing hiring, but consulting continues to offer faster promotion cycles, broader industry exposure, and a better path to business leadership. The highest paying firms at the post-MBA/PhD level are Analysis Group, AlixPartners, Strategy&, EY-Parthenon, McKinsey, Accenture Strategy, BCG, Altman Solon, OC&C Strategy, Bain, and Oliver Wyman.
Internships are a standard 10 weeks in the United States (early June through first or second full week of August) but the range is 8-12 weeks in Canada and the EMEA. Monthly internship salaries are typically prorated based on starting salaries for new hires. Here are 2023 internship salaries:
Undergraduate & Master’s Program Internship Salaries
If you have any management consulting salary data you would like to share, we would love to hear from you. You can fill out this anonymous form or send us an email. As always, your anonymity is guaranteed.
Management Consulting Salary Insights
Management Consulting Bonuses
Full-time consulting offers are nice, but bonuses have the potential to take your comp from good to great. Generally, consulting full-time hires receive signing bonuses, relocation bonuses, end-of-year performance bonuses, and more. Consulting interns are less likely to receive bonuses, although some firms do offer relocation or signing bonuses.
More firms are starting to offer returning interns a larger signing bonus than full-time counterparts who interned somewhere else. The most extravagant of these include MBA second-year tuition coverage plus signing bonuses (here’s looking at you, Deloitte).
When analyzing these bonuses, there are 5 things you should keep in mind:
Value base salary more than signing and relocation bonuses. Your salary during your 2nd (and sometimes 3rd) year at the firm is often a function of your initial base salary. All else held equal, we would recommend choosing a base salary of $92,000 with a $5,000 signing bonus over base salary of $90,000 with a $7,500 signing bonus.
On your offer letter, the listed maximum amount of the performance bonus typically goes to the top 5-10% of performers. Average performers often receive bonuses closer to half of the maximum amount, while poor performers typically only receive a small bonus if any. Also, firms that pay overtime may choose not to offer a performance bonus.
The size of the relocation bonus is primarily driven by the distance from your university to the office location. If you live in the same city as the office, you are sometimes offered no bonus or a smaller bonus (~$2,000 in the U.S.). However, if you live in a distant state or country, you are typically offered the firm’s maximum relocation bonus amount.
Relocation and signing bonuses are commonly distributed soon after signing your contract. However, they may be distributed on your start date (e.g., at IBM GBS) or given in increments over several years (e.g., L.E.K.).
Bonuses are usually taxed. Uncle Sam loves your bonuses and will make sure to get his share. So don’t forget to account for taxes when planning your bonus spending (or saving). Taxes may be deducted when receiving bonus payments or they may be withdrawn from future paychecks, putting a small temporary dent in your future monthly income.
Salary Growth Along the Management Consulting Career Path
The salaries above are for full-time hires and interns coming straight from an educational program. Before deciding on a final offer, consider how your salary will grow across time. Often, our interview prep clients will receive slightly higher job offers in tech than in consulting. However, the salary growth in management consulting outpaces many industry positions. Because of that, the net income after a few years in consulting can exceed those in other industries, despite an initially lower base pay.
In top consulting firms, you can typically expect a 10-20% increase in your base pay and/or performance bonuses each year. Additionally, when promoted to the next level (usually every 2-3 years), the increase in your income is substantially larger. For instance, when promoted from Associate to Consultant at BCG, your base salary almost doubles. Here’s the potential salary growth trajectory of someone working at a top consulting firm (McKinsey, Bain, or BCG) in the U.S.:
Consultant Salary Growth Trajectory:
First-year out of Undergrad/Master’s program:
Signing Bonus: ~$5k
Performance Bonus: up to ~$30k
First year out of MBA/PhD program:
Signing Bonus: ~$35k
Performance Bonus: up to ~$60k
Manager/Project Leader (2-3 years out of MBA/PhD) program:
Associate Principal/Senior Project Leader (4-5 years out of MBA/PhD) program:
Junior Partner/Principal (6-8 years out of MBA/PhD) program:
Senior Partner/Director (10+ years out of MBA/PhD) program:
Keep in mind that most full-time hires will not make it to Partner. Many consulting firms have an “up-or-out” promotion structure – and many consultants choose to leave. Those who perform exceptionally are given the chance to be promoted, while poor performers are encouraged to seek employment elsewhere. Because of the up-or-out structure and the attractive exit opportunities, only a small percentage of consulting recruits make it all the way to Senior Partner. Regardless, salary growth is substantial for each promotion you receive at a consulting firm.
Salaries When Exiting Management Consulting
Although your salary increases relatively rapidly within a top consulting firm, you typically receive a pay increase when leaving, as well as a bump in lifestyle. In the U.S., the average consultant who accepts an industry position receives a 12-20% increase in pay and a better work-life balance. Those entering the financial services industry receive a 30%+ increase in compensation—but work/life balance often takes a hit.
Although your salary increases relatively rapidly within a top consulting firm, you typically receive a pay increase when leaving, as well as a bump in lifestyle.
Large Consultant Salary Variation Across International Offices
There is a large variation in management consulting salaries within firms across different countries. Management consulting salaries are highest in the U.S. due to the aforementioned war for talent with Silicon Valley and Wall Street, heightened U.S. demand for consulting services, and a generally tighter domestic labor market. Compared to the rest of the world, the United Arab Emirates, Singapore, Switzerland, and Canada also boast relatively high consultant salaries. Most surprisingly, consultant salaries in London are relatively lower given its high cost of living.
Overall, consulting salaries are competitive within their country, often offering salaries 20%+ above the average for other professional service firms. If you accept a consulting offer in any country, you will likely be paid more than the average local employee with a similar tenure in professional service industries.
Small Consultant Salary Variation Across Domestic Offices
At McKinsey, Bain, and BCG, management consulting salaries are relatively flat across all offices within a country. This has two important implications. First, there is often little room for salary negotiation unless you are an experienced hire. Second, you can increase your take-home income by choosing an office location where the cost of living is lower (e.g. choosing Atlanta over San Francisco).
In other firms, salaries are sometimes adjusted to account for living costs. For example, a Big 4 consultant working in New York often receives a slightly higher salary than a Big 4 consultant in Dallas.
Consultant Salaries for Master’s and PhD Students
Many consulting firms offer master’s students the same positions as undergraduate students. Because of that, master’s students often receive the same compensation as undergraduates (Deloitte is a notable exception to this). However, when a master’s student applies for a relevant technical position (e.g. data scientist), they can receive more compensation than an undergraduate counterpart. Likewise, PhDs often (though not always) receive the same compensation as MBAs. This is important to note, as you should be applying for the position the firm wants to hire you for.
2023 Consultant Salary Summary
Overall, the state of the industry is strong. Both at the undergraduate/master’s level and post-MBA/PhD, management consultant salaries continue to stay competitive to rival Banking and Big Tech.
Overall, consulting salaries are highly competitive compared to other industries. One notable exception is finance, where salaries are higher but work-life balance is often worse. Technology firms also compete with consulting firms for talent. They often offer higher base salaries but the roles are more siloed and the promotion trajectory is slower.
Do you have any consulting salary data or comments that you would like to share? You can fill out this anonymous form, add a comment below, or send us an email. As we attempt to provide quality compensation data to our readers, we appreciate any data that you share. As always, your anonymity is guaranteed.
Looking to land a position in management consulting? Check out the world-class interview prep and resume prep services that have helped land thousands of readers (like you) positions at top management consulting firms.