MS = Start making money fast but have to work harder to rise in a technical organisation. A Phd atleast starts off with being trusted to have the right technical experience/expertise whereas a Masters has to prove him/herself. However, in our industry (and science in general), trust and respect has to be earned. So, both have to keep earning that respect. There are no research academic positions open to a masters and no/few research positions in industry.
PhD = Start making a lot of money but after 5 years. No limits, can go to academics or industry. Can pretty much get any job one wants. However, this is not to say that a masters who works very hard cannot do the same (except research jobs). However, doing a PhD is a personal decision, based more on your philosophy of life. If you just want money, do a Masters -- better still, do a MBA ! :) For those who want a bit more and are inclined to think about the later half of their career, a PhD may prove to be useful.
When it comes time to promote, it comes down to qualifications for 2 almost equal people in terms of expertise. A Phd always starts higher, gets better projects and can *always* stay in the bleeding edge of technology. Also, there are so many people who are getting PhDs nowadays that there is no dearth of PhD applicants for jobs. PhDs are given a benefit of a doubt over Masters when it comes to things like promotion, project assignment etc. That being said, when considering people for projects, managers usually actually look at past experience and reputation. If you have done a "good" PhD, you should be able to maintain a good record and reputation; ofcourse, provided you work hard enough :)
However, again, there is no dearth of startups nowadays, so anybody can get into good projects anyway. But it depends on the kind of work you want to do. A startup usually has a few PhDs and scores of Masters. They do different kind of work, even though, their compensation may be almost at par. Also, ever notice how most successful startups have a PhD as CEO !
The drawback of having a PhD is that sometimes you are over-qualified for jobs such as software engineer et cetera. Also, in bad times, companies may pick MS students fresh out of school rather than pay the higher salaries that are required to hire fresh PhDs.
That being said, a Phd can go anywhere - to industry, academics or start his/her own company. Generally, more respected and with many more contacts, it is easier to be involved in a new tech start-up. A Phd lends more credability when trying to get money from venture capitalists and banks. Also, most of your colleagues from graduate school are either professors or in bleeding-edge technology companies. The other differences are more subtle; often someone with a PhD is more likely to understand new, path-breaking technology faster than someone with a MS -- purely because a lot of the PhD training is geared towards this. However, some of the most technically sound people I have met, do NOT have a PhD. Also, a Phd does not imply that you will gain complete respect and trust for everything you say. Like I said, in the science community, respect *must* be earned.
Now, moving on to the more important things in life; lets talk about money ;)
Say, a master's starts at $60,000-80,000, with increase of about 10 % a year
(post-internet bust the increments are actually down to 5 %). A Phd starts
at atleast $80,000-100,000 in the computer industry.
Money earned taking into account that Phd takes 3 more years than MS:
|MS||60,000 * (1.10)^3 + 60,000 * (1.10)^(t+3)|
|PhD||80,000 * (1.10)^t|
So, when you compare two people, one who started working after his/her masters and the other who finished his/her Phd in an additional 3 years, we find that the person with MS is earning about 80,000. So, it turns out that the Phd starts working with atleast as much as the person with MS. Ofcourse, this does not account for lost income in the 3 years.
In terms of stock options, I think this analysis can end up being skewed since a masters can make a lot of money with options in the 3 years that the Phd is still finishing. The Phd however starts off with better options and sign on bonuses. All this assumes that a Masters student will not to join a startup. In general, startups will easily hire a Phd but will look for considerable experience when hiring a Masters. So, all in all, Phds lose out on 3 years or more of money making and living the good life (yeah, right; 9 to 5 job, followed by a frozen dinner and a beer).
This, ofcourse, was an analysis totally from the point of view of money since a lot of naysayers argue that a Phd can not make money and definitely not as much as a MS. However, everyone assumes that PhDs will join academics or a research lab. The fact of the matter is that a large percentage of PhDs join the industry. (As a side-note, if you have work experience, don't even think about a full-time MS; if anything do a part-time Master's.)
After having said all this, I also have to say that doing a Phd is a
very personal choice and requires a lot of thinking about what you really
want out of
life. Earning a lot of money and having a 9 to 5 job with a family to
return to, is a relatively easy thing to do in the IT industry. However,
having worked in the industry and come back to graduate school, I found
that I get a lot of satisfaction out of the research work I do.
Startups can be fun but not something you can keep doing for the rest of
(Read this excellent article on Notes on a Phd Degree by Douglas Comer)
All things considered, the choice is pretty clear to me.
Please leave a comment. I really look forward to your experiences and feedback.
Other articles I have written
- Other Marketing and Education Articles I authored
- What do Product Managers do?
- How to move from Engineering to Product Management
- I am an engineer; should I do a MBA?
- Practical Tips for Product Managers
- Startup Marketing Article - Its All About Figuring Out the Customers, Stupid!
- Impressions of working in the US and in India
- My take on the NRI quota at the IITs
- Comparison of Indian versus American Education
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