It’s no secret that MBA applications continue to drop across U.S.-based MBA programs. Even the most desirable schools haven’t gone unscathed. During the 2018-2019 application cycle, the top-10 MBA programs in the U.S. saw a drop of about 3,400 applications — or about 5.9% — compared to the previous year.
Now a new survey shows that the threat is viewed as more existential, particularly the further down the ladder you look.
According to Kaplan, the test-prep company and platform, between 2014 and 2018 the number of accredited full-time MBA programs plunged 9%, to a total of 1,189 programs. Kaplan’s new survey of admissions officers at 156 U.S. MBA programs, released today (November 13), finds that the downward trajectory is affecting outlooks: Nearly two-thirds of adcoms believe the trend of declining accredited business schools will continue.
MOST ADCOMS: ‘STRONG ECONOMY’ IS KEEPING POTENTIAL APPLICANTS FROM APPLYING
While 63% agree that decreases in applications are likely to continue, respondents are split on exactly what is causing the decrease in interest among MBA programs (see chart below).
Most (42%) believe that the strong economy is keeping prospective students in the workplace. More concerning for MBA programs, 22% believe the decrease is a result of “lingering doubts” about the value of an MBA. Another 18% believe the decline is a result of international students avoiding U.S. schools because of the “political climate.” Some 13% blame the cost of an MBA, while 5% think potential students believe fewer jobs require an MBA now compared to years past.
Regardless of the truth of the last point, many schools continue to produce graduating classes that report record-breaking salaries, says Jeff Thomas, executive director of graduate programs at Kaplan Test Prep.
“What we would say to those who are on the fence about going to business school is that as far as admissions odds and earning potential go, this is one of the best times in recent memory to enroll and earn your MBA,” Thomas says in a news release accompanying the survey results.
LESS COMPETITION NOW THAN THERE HAS BEEN IN THE PAST DECADE
Thomas points to two facts arising out of the app decline. First, this could be the best time in recent memory to apply to an MBA program. Not only are there obviously fewer applicants to compete with, but there are also fewer accepted students competing for scholarships.
Additionally, Thomas says, schools are being pressed to innovate beyond the traditional full-time residential MBA program and look into more online and otherwise flexible part-time programs.
“Lower application volume means less competition to get in, though to be clear, top-ranked programs are never hurting for top talent,” Thomas says. “It’s also the case that starting salaries and bonuses for newly minted graduates from some business schools have hit record levels, which shows us that the ROI for an MBA is still strong.
“To adapt to students’ changing learning preferences and with a likely eye toward the future of graduate management education, many business schools have invested significantly in their online MBA programs, a majority of which grew in application volume or at least kept pace with last year. We will be tracking these statistics and trends carefully to keep aspiring business school students updated with the most accurate information. The most successful applicants are the most informed ones.”