In the Great Recession, a record amount of graduate management programs reported an increased number of applications according to the Graduate Management Admission Council (an association of graduate business schools).
Many economists now believe the U.S. is headed for another recession. A Master of Business Administration degree may offer a better option than the current economic uncertainty. It has a higher earning potential and could be a good investment.
The economy is still being affected by inflation. According to Crunchbase News (a business publication), more than 94,000 U.S. technology workers have been laid off this year. This is in addition to the 140,000 tech workers who were fired last year.
Top business schools such as Kellogg School of Management or Tuck School of Business offer a waiver of GMAT and GRE exams to recently laid-off employees. This increases the incentive to return to school.
A looming recession does not make an MBA easy.
Are you unsure if now is the right time to start business school? Here are some things to think about.
Employers still want MBAs
GMAC’s 2022 Corporate Recruiter Survey found that 97% of recruiters believe the demand for MBA candidates will remain the same or grow at their companies.
This confirms the positive trend that has been evident over the past 15 years, according to Maite Salazar (chief marketing officer at GMAC).
Despite the economic uncertainty caused by the pandemic in the economy, the hiring trends for MBAs remained steady from 2020 to 2022. Salazar says that employers leaned on MBAs to hire them for their leadership skills, problem-solving abilities and ability to expand and scale globally.
The high cost of an MBA can still be a barrier
A survey of 2021 GMAC students found that 60% of potential MBA students believe cost can moderately affect their decision to go to graduate school.
According to a report by BusinessBecause (a website that provides graduate management education), the average cost for an MBA in the United States is $225,605. This is 3.7% more than 2021 and tuition and fees have been trending upwards globally.
Although scholarships, fellowships, and grants are the best ways to pay for an MBA degree, they won’t cover all the costs. MBA student loans may be used to cover expenses. However, the higher the interest rate, the lower your return on investment.
MBA graduates believe it’s worthwhile
According to a survey by GMAC in 2022, more than 85% of graduate managers believe that their investment in a master’s degree in management was worthwhile. The survey included 3,600 MBA candidates from over 700 business schools worldwide. Between 2010 and 2021, respondents completed their graduate business education. Survey respondents saw greater employability, higher earning power, and a wider professional network as the greatest returns on their investment.
Nearly two-thirds (63%) of MBA graduates have risen to one level in their careers after receiving an MBA. The survey revealed that those who had been in less senior roles before obtaining an MBA saw greater career advancements.
and 2022 GMAC data show that starting salaries for U.S. MBAs are $40,000 more than starting salaries for bachelor’s degrees alone, even though salaries have remained flat in the past three years.
MBA results can vary based on race and gender, as well as other factors. GMAC’s study found that Black, Hispanic, and Native American graduates are less likely to report career progression than those who are white, Asian, or of another race/ethnicity.
A MBA is not the only way to financial success
If you are looking to improve your business skills, you have options. These include business graduate certifications and professional certifications.
These are credit-based programs that can be offered by universities and colleges to business graduate certificates. These certifications are more focused on a specific field and require less courses than an MBA. They can also be easier to pay for and take up less time than the MBA.
Companies and national organizations offer professional certifications. These are often sought by people who are looking for certification in a particular skill, role, or software program. While some certifications include multiple courses, others require passing an exam. Prices will vary depending on the program.
Mini-MBAs can take many forms. Mini-MBA programs may be offered by universities. These can function in a similar way to business certificate programs. You can also earn credits that will count towards your MBA degree. Some organizations, such as Abilitie (a leadership development company) that offer a 12-week formal mini-MBA, also offer non-accredited programs that focus on specific business skills.
Mini-MBA programs can make MBA-level skills available to people who might otherwise not have them, says Luke Owings (VP of product at Abilitie).
A mini-MBA and other business certifications do not equal an MBA degree. These programs are valued differently by different companies.