A Harvard Business School MBA class during the pandemic
“The reports of my death are greatly exaggerated.”
Mark Twain’s famous remark, in the text of a cable he sent from London after his obituary had been mistakenly published, could just as easily been said about the most popular credential in business: the MBA degree.
For years, naysayers have been writing obits for the most successful educational product in the post-war period, even though it has remained the most popular graduate degree in the U.S. since surpassing master’s in education back in 2010-2011. But in more recent years, applications to two-year residential MBA programs have been declining and several business schools, including the University of Illinois and the University of Iowa, have shut down their full-time MBA offerings.
Success often breeds contempt. So there have been an endless parade of critics eager to write death notices for the MBA. But if there was ever a time for those critics to eat humble pie, it’s right now. Applications to the top MBA programs are soaring. In the just ended admissions cycle for this fall’s classes, applications to the top 25 business schools are up an average 22.6%. The windfall has led many schools to increase class sizes to record levels.
Twelve schools enjoyed double-digit percentage increases in applications, led by USC’s Marshall School of Business, which saw an amazing 66.4% jump in apps; Rice University Jones Graduate School of Business, close behind at 63.4%; and CMU Tepper School of Business (60.2%), Northwestern University Kellogg School of Management (53.8%), and UNC Kenan-Flagler Business School (43.8%). At the University of Virginia Darden School of Business, extending round three by 99 days resulted in a wild 364% jump in MBA apps for the round, which ended up giving the school a 37.7% increase overall.
“It’s definitely one for the books,” Danielle Richie, senior associate director of MBA admissions and student recruitment at Kenan-Flagler, said of the 2019-2020 cycle. “We increased the size of the class because we had so many strong, quality candidates that we really wanted to build a diverse class out of the increased pool.”
The major reason for the big increase in volume is the pandemic-induced recession. Historically, applications to graduate programs rise when the economy tanks. That occurs because young professionals get laid off or see their prospects for promotion and increased responsibility diminish. So recessions are ideal times to take a time out from work and upgrade one’s skills.
When COVID hit, many business schools extended their deadlines and made applying to their programs a bit easier. Those actions opened the door to the 20-somethings who suddenly believed that an MBA degree on their resumes would be highly valuable to their careers.
But we also are seeing pent up demand for the MBA after a long period of economic growth and a tight job market when many could get job opportunities and pay increases without a graduate degree. The schools, moreover, have raised tens of millions of dollars in scholarship support to offset the high sticker prices of the degree, making the MBA experience less expensive than it appears to be.
In this new 2020-2021 admissions cycle, many schools say the surge is continuing. Applications are up at Stanford Graduate School of Business for its recently closed round one deadline. They also are up at Columbia Business School which reported a new record in apps for 2019-2020.
So it turns out those obituaries for the MBA were clearly premature.
