What Do MBA Admissions & Trading Activity Have In Common?
Both of their activity has nearly evaporated? I don’t think that’s feasible for B-schools. They’re at multi-year lows? Only trading volumes are. The industries are downsizing? You’re thinking too far into the future. Okay, so this is a bit of an exaggerated comparison but both of their directions are similar, an overall decline. Recent data from some of the premier B-schools show that year-over-year admissions for the class of 2014 are down, ranging from 1.5% to 21%! If you’re targeting one of these colleges you’ll want to find out who’s down and what does it mean, read on to find out...
According to class profile data from 17 colleges obtained by Bloomberg Businessweek, 12 of the top 30 B-schools are showing single- and double-digit declines in full-time MBA admissions while colleges such Stanford are down a mere 1.5%.
Poets & Quants makes a one-line mention of how Colombia and NYU Stern have been affected by layoffs on WS but far from NYC, Indiana University’s Kelly School saw its admissions decline by 21%!
Do you think this is reflective of the financial industry or just an isolated instance?
Senior Associate Director of Admissions and Financial Aid for the Kelley School, Timothy Smith cites an,
…increased competition from rival business schools and a plethora of available choices, including part-time and online programs.”Yet, he also offers other explanations such as second-tier B-schools aggressively recruiting candidates with hefty financial aid packages and the near non-existence of employer sponsorships.
Interestingly, of the 13 colleges which selectivity data were available, 77% more applicants were admitted this year. More precisely, selectivity dropped. B-schools such as Dartmouth’s Tuck, University of Minnesota’s Carlson, and Brigham Young’s Marriot declined by 2% while others were as much as 3%.
If you’re targeting these types of colleges, does this help or hurt your possible acceptance?
In my opinion, economically, this is simply a momentary change in aggregate demand for MBA education due to preferences (i.e. expected future cash in- and outflows from various education choices) and less as a result of price elasticity (i.e. responsiveness to tuition). Financially, given the current economic state it’s likely that one values their employment experience, the ends of education, more than furthering the financial liability of graduate school. Whatever the true cause is…
I’d like to hear your opinion on the decline of admissions and should it be a concern?
Looks like a good place to put on a mean-reversion trade
I think MBA apps will shoot up next year when the economy once again goes into a recession. I think it will be another 3-4 years before the economy starts to actually recover. So yeah, this year is the perfect time to apply to schools.
Still surprised that columbia and stern dropped so much, given that those two schools have been so popular lately due to the NYC location. I think though the columbia stat includes january term applicants as well.
Brady , why is it surprising that the two schools with the greatest finance exposure dropped the most?
Well, wharton and booth are also finance schools, but their % drop is much less drastic. So there's something going on at columbia/stern that is not happening at wharton/booth. Given that the finance job market is still very weak, i would think that more people would be applying to b-schools, similar to what happened in fall of '08 and early '09.
I actually think booth has the best momentum among any b-school out there; people are turning down wharton left and right for booth, and i think unless wharton gets its act together, booth will become the #3 b-school in the world.
Wharton actually has a very strong general management program. And Booth I think is more quant-finance so it has that trend going in it's favor.
Anyone care to explain why there is no decline in Stanford?
I'd say if anything a decline in established career paths would mean more entrepreneurs
If competition from online programs is legitimately the cause of the application volume decrease, they wouldn't have been accepted in the first place. I'm predicting no net effect on the "chances" of an identical person applying 4 years ago vs. now vs. 4 years from now. They're looking for rock stars, and if someone decides to University of Phoenix MBA instead - well, have fun.
To the OP: stop calling them "colleges". They are professional schools under the umbrella of a larger university.
R0bin: Silicon Valley probably has something to do with it.
Volume numbers are down but the class profiles have remained pretty consistent. Goes to show that there are more qualified applicants than spots. You're splitting hairs between degrees of competitiveness: it's competitive.
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