Two-Year MBA Programs In Application Slump by: John A. Byrne on September 20, 2016 | 7,833 Views September 20, 2016 Copy Link Share on Facebook Share on Twitter Email Share on LinkedIn Share on WhatsApp Share on Reddit For the first time since 2012, less than half of full-time two-year MBA programs experienced year-over-year application growth this year. This is the second straight year that the share of programs reporting growth is down from a high of 61% in 2014, according to a survey report published today (Sept. 20) by the Graduate Management Admission Council (GMAC) Only 43% of full-time two-year MBA programs report receiving more applications this year compared with 2015, the survey found. Some 48% of the responding schools report a decline in volume for 2016. Some 40% of full-time two-year MBA programs in the United States and 45% of such programs in East and Southeast Asia report application volume growth in 2016. But while demand is falling overall for traditional two-year MBA programs, the survey found that application volume differs by program size. A majority (57%) of large programs which enroll more than 120 students report increased volumes this year compared with small (33%) and mid-sized (40%) programs. “Demand among the M7 and top 20 in the U.S. continues to rise as captured in GMAC data on programs of more than 120 students,” says Caroline Diarte Edwards, a partner at Fortuna Admissions, a leading MBA admissions consulting firm. “We are seeing that increased selectivity among the top schools is encouraging applicants to apply to more schools among the Top 20. Career data whether at Duke, Darden, Cornell and UCLA, or at great schools such as UT Austin McCombs, CMU Tepper and UNC Kenan Flagler is giving the latest generation of MBA hopefuls more confidence about the positive return on an MBA beyond the M7.” LARGER MBA PROGRAMS SEEING GROWTH IN FEMALE APPLICANTS GMAC said the large-small pattern of application volume holds true when measured by various applicant demographics. Large programs are more likely than smaller programs to report application growth from domestic, international, male, and female candidates. The greatest difference is seen in application volume from female applicants—75% of large full-time two-year MBA programs report growth in applications from women vs. 45% of mid-sized and 42% of small programs. Among programs in the United States, the majority of large (75%) and mid-sized (55%) programs report growing volumes among underrepresented populations6 compared with 38% of small programs. GMAC researchers said that the downturn in two-year programs is “atypical compared with past economic cycles.” During the recession of the early 2000s, application volumes increased and then declined, hitting bottom in 2004. Application volumes grew once again, reaching a new peak in the midst of the ‘Great Recession’ in 2008. “It appeared that application volumes would follow past recessionary periods,” according to the GMAC report. “However, the expected post-recessionary decline in volumes was neither as rapid nor as deep as before. Application volumes have been mixed in recent years, with smaller programs tending to receive fewer applications and larger programs experiencing growth.” Some survey respondents told GMAC that the slow economic recovery has dampened students’ perspectives about their future. Said one respondent, “Students are less sure about their professional futures and therefore many are not willing to commit to investing in an MBA program at this time.” Other schools point to the proliferation of and diversity of business programs, including growth in high-quality programs, as a source of increased competition. As one respondent observes, “The competitive landscape has changed—there are a lot of business schools, giving potential students more choices.” Full-Time Two-Year MBA Programs Reporting Change Source: 2016 GMAC Application Trends Survey SPECIALTY MASTER’S PROGRAMS DRAWING APPLICANTS AWAY FROM TWO-YEAR MBAS These choices include more non-MBA business master’s programs and new MBA program formats, such as the online MBA, which GMAC said are generating upward pressure on volumes. “For example, survey responses this year show nine percent of online programs are new in 2017,” according to the report. “Other growth areas include Master in Data Analytics programs (36% are new in 2017), Master of Supply Chain Management (19% are new in 2017), and Master of Marketing (16% are new in 2017). Yet this competition continues to add downward pressure on volume growth for flagship programs such as the full-time two-year MBA and part-time MBA.” The downturn, moreover, would have been much worse if not for an offsetting increase in applications from international candidates. For the incoming class of 2016–2017, GMAC said, the majority of applicants seeking admission to full-time two-year MBA programs are international candidates, representing 52% of the applicant pool (see below chart). Domestic candidates account for the remaining 48% of applicants. Overall, 47% of full-time two-year MBA programs report increased application volumes for domestic candidates this year compared with 2015; 42% of programs report increased application volume for international candidates. Full-Time Two-Year MBA Applicant Pool, by Citizenship Source: 2016 GMAC Application Trends Survey Continue ReadingPage 1 of 2 1 2