Drop In MBA Applicants A Sign Of Economic Recovery?

“Maybe I should finally get my MBA,” is a thought that went through the heads of many an out-of-work or underemployed college graduate during the last few years. But the allure of becoming a master of business administration has faded in the last year, as the number of business school applicants has taken a nose dive.

According to the Graduate Management Admission Council, the evil geniuses behind the Graduate Management Admission Test, applications to two-year full-time MBA programs fell 22% between 2011 and 2012.

Of course, this decline comes after a few years of many schools being snowed under by applicants looking for something to do other than watch three hours or Springer, Maury and Steve Wilkos every afternoon.

The assistant dean of admissions at Columbia University’s business school tells the Wall Street Journal that its 19% drop in applicants is likely due to potential applicants now having jobs they can’t leave (or don’t want to risk leaving) in order to attend classes full-time.

Another, less silver-lined, possible reason for the decline in applicants is that the current blah condition of the economy may have potential applicants worried about going deeper into debt for a program without a guarantee that it will pay off quickly upon graduation.

Both reasons could explain the global increase in applications for part-time, online and executive MBA programs that allow students to keep working while they study.

Not all programs have seen huge declines in applicants, with UCLA’s Anderson School of Management actually experiencing a whopping 22% increase in applications, which the school attributes to marketing efforts. Meanwhile, the University of Virginia saw an 8.9% jump in applicants to its Darden School of Business, a growth that I’m going to speculate, with absolutely no bias whatsoever, is due to the fact that UVa is frickin’ awesome. (Go ‘Hoos!)

B-School Applicants Decline for Four Years [WSJ.com]

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  1. xmason99 says:

    I make my own M.B.A.’s at home, so this won’t affect me one bit.

  2. umbriago says:

    “Maybe if I get my M.B.A. I can get that promotion…and run the deep fryer!” …guess again Skippy.

    Also, what in heaven’s name is a ‘Hoo? Geez, I know where the Rockets and the Polar Bears are, but the ‘Hoos?

    • nybiker says:

      http://en.wikipedia.org/wiki/Wahoos

      “Wahoos, or Hoos for short, is an unofficial nickname for sports teams of the University of Virginia, officially referred to as the Cavaliers. The terms are both also used in a more general context by students and alumni to refer to themselves as fans and alumni of The University.”

      • umbriago says:

        Well, I knew UVA were the Cavaliers, so that’s ‘nhoos to me. I would have to guess being a Hokie is cooler though.

  3. quail20 says:

    Going broke by ‘Degrees’. Think there was a book out in the last decade about that. Essentially the MBA is dangled like some priceless fruit that many find to be rotten once they spend large sums in buying a ladder to reach it. Oh, it is a good tool if you have a particular focus and reason to get it. If you’re getting it, just to get it. . .yea, I’ll have fries with that.

  4. eturowski says:

    Maybe people are finally realizing that an MBA is not necessarily a good investment, like many other types of degrees.

  5. dolemite says:

    I find it interesting when people learn Chicago school teachers (many with Masters Degrees) make $75k a year, they blow a gasket. But for an MBA at a financial institution…well…that’s an important job. Those guys *should* be making 300k a year. Educating future generations of American workers and citizens? Well…anyone doing that job should make 15k a year. I mean…they don’t even work summers.

  6. HogwartsProfessor says:

    *sigh*

    Working on finding a new career path myself. I’m told with an English bachelor’s degree, that instead of another associate, I should get a master’s. In WHAT?! All I can think of is Communication (marketing, copywriting, etc) but no one seems to be able to tell me what actual JOBS I can do with it. There is a serious disconnect between the academic side and the career centers!

    I can’t think right now; I have no idea what to do. All I know is that my (documented) issues with math mean I can’t do the admin jobs I used to do, since they’re being consolidated with accounting.

    • jeepguy57 says:

      What jobs can you do with a degree in communications, marketing or copywriting?

      Brand/product marketing
      Ad agency – account management/sales
      Ad agency – copywriter, editor, creative director
      Sales (almost anything)Public relations – corporate, agency
      Public Relations – corporate or agency

      I just thought of those in about 30 seconds. I have no doubt there are many more if I had more time to think of them. Sure, you’ll start out at the bottom but there is a lot you can do with a degree like that and a lot of opportunity over time, if you work hard.

      • MarkFL says:

        Yeah, I have a degree in Advertising. That’s how I ended up in retail. I could get some freelance work doing copywriting, but it’s a bad time right now, and even in better times, I ended up being a part-time writer and a full-time collections agent.

    • VintageLydia says:

      I’d ignore getting a degree in communications. It’s got one of the worst ROI rates of any degree. The one you have actually has the best :/
      It sucks the way the job market is where you are at. If you were in my area, you’d have a bit easier time finding work but the COL is so high, plus the expense of the move itself, probably not worth it right now.
      I find that almost anyone in academia over-inflates the usefulness of a master’s degree. Unless you have a specific goal that requires it, I’d stay well away.
      Have you tried data entry type work? It’s monotonous as hell but usually pays OK, at least here (Northern Virginia/DC.) The office I worked at let us listen to music and stuff so I knocked out a couple audio books which helped make the day go by a lot faster.

    • who? says:

      yeah, what jeepguy said. There’s lots of interesting places a master’s degree in communications will take you. Beyond that, I always advise people who want/need to go back to school and already have a BS or BA to get a masters degree in something. If you’re getting the masters in a field that’s different than your bachelors, you’ll have to take some prerequisites, but it’s doable, and a well chosen masters degree will make you a lot more money, faster, than an associates’ degree ever will.

    • finbar says:

      I’ve got a comms degree, and I don’t work in the field; the internships I got a through school ended up mattering a lot more than the BA I got from school.

    • galaxirose says:

      You should definitely get a Masters and not an additional associates, but tell me, why do you want a Marketing or Communications degree? Those jobs will usually take anyone with any degree at entry level. You just have to work your way up the ladder — usually long and ugly hours and low pay at the beginning, but once you hit the 3-5 year mark and start specializing in different aspects (product, brand, direct, PR, etc.), the growth accelerates. With no experience, your bachelors will be just as good as a masters.

      From my personal experience as a literature-degree holding Marketing pro (going on 7 years now.. eesh..)

  7. luxosaucer13 says:

    I would’ve thought that MBAs would still be in demand with all the greedy mega-corporations out there. Why, they could show all the execs how to increase their profits by slashing even more jobs at the expense of the American economy, and outsourcing them to India, China and Central and South America. All it would take is a few more young, fresh-out-of-college, with ZERO real-world experience, wild-eyed MBAs, with their flashy Excel Spreadsheets and whiz-bang PowerPoint presentations showing execs all across the country how to screw the American worker and make a killing at it at the same time.

    Now THAT’S talent!

  8. Blueskylaw says:

    I was thinking that because of the still crappy economy (and I think it will still get much worse), I might apply to Columbia or the Wharton School of Business to get my MBA. I would only be able to attend if they gave me a fantastic scholarship or grants. With the proliferation of online, for profit schools, there are huge numbers of “MBA’s” being pumped out, but a brand name school will still open doors that the average MBA won’t be able to get into. The pay is good as well. The average starting salary of a new Columbia MBA is roughly $120,000, while Wharton’s is roughly $150,000.

    • Bsamm09 says:

      Also, those Ivy League MBA programs don’t usually take students who recently earned their bachelors degrees. They want executives with real world experience who need the MBA to advance.

  9. Boiled for your sins says:

    Where I work is looking for an MBA – to do basic sales reporting. The job is grade 50 – under 50K a year. It would take forever to pay off that MBA, especially in the NY/NJ area.

  10. MarkFL says:

    “I’m going to speculate, with absolutely no bias whatsoever, is due to the fact that UVa is frickin’ awesome.”

    That’s a very cavalier attitude.

  11. GreatWhiteNorth says:

    Sorry folks, but this is a good thing especially if it is a drop in applicants without any management experience (i.e. just out of their undergrad). I am tired of experiencing firsthand the incompetence of MBA grads who, with no real experience, make textbook changes that result in the decline of businesses.

    Let the MBA flame wars start…

    • jeepguy57 says:

      I don’t see a lot of MBA’s coming right out of college and making big textbook changes – or changes at all. The reality is that most companies won’t hire recent MBA grads that don’t have at least a few years of solid, relevant experience. I see so many kids of friends and family graduating with BA or BS degrees and immediately going for their masters. In a few fields (maybe engineering) that might make sense. But in business it is useless without practical experience.

      I earned my MBA at night while I worked a full time job. In the end, the additional stress of working ad going to school paid off since I had actual experience.

      I will get flamed for this, but I also feel going to a physical school is far better than online. The dialogue in the classroom, with other business professionals, was paramount to the education I received. Being hit on the spot with a question or challenge teaches you real skills – not being able to sit back, use google and Wikipedia and come up with a nice response to an online question.

      • Autoexec.bat says:

        Agree agree agree. Same track. Had 4 years of experience out of undergrad and went back to get an MBA part-time, at night. Four years was just enough time for me to figure out where I had major gaps in knowledge and experience and which of those gaps I wanted to fill in pursuing future career options.

        Also agree about online classes in virtually all subjects. Barring overwhelming evidence to the contrary, I am going to assume that someone with an online degree is kind of a slacker compared to someone who earned their degree in a classroom. It might not be right but most people I know who earned Masters degrees online did it to check a box (I know several teachers and a few MBAs who did this) and nothing more.

    • MarkFL says:

      Actually I’m with you. There are so many people with MBAs who come into a company that is performing well and make changes without knowing anything about the actual industry, apparently because they want to make a name for themselves. Never mind that people who have been doing this for 20 years can immediately see where it’s going to jump the tracks. You can’t tell a VP with an MBA he doesn’t know what he is doing because, well, he has an MBA, so obviously he knows more.

  12. AtlantaCPA says:

    I got my MBA and my employer could not have cared less. It might give me a slight leg up down the road when I apply for some other position but so far I’ve seen zero return on my investment.