The MBA App Slump Cost The Top U.S. B-Schools $3,444,990 Last Year by: Marc Ethier on May 22, 2024 | 8,857 Views May 22, 2024 Copy Link Share on Facebook Share on Twitter Email Share on LinkedIn Share on WhatsApp Share on Reddit Harvard Business School made about $2 million in the 2022-2023 MBA application cycle from candidates paying the school’s $250 fee to apply to the program. It could have made a lot more. Harvard wasn’t alone — in making the big bucks from MBA candidates applying to their full-time programs, and in losing out on money because of the global two-year slump in MBA apps. According to calculations made using U.S. News data, The Wharton School at the University of Pennsylvania made $1,703,075 last year but could have made over $2 million; Stanford Graduate School of Business made $1,702,250, but likewise could have eclipsed $2 million; Columbia Business School made $1,357,500, which could have been over 1.6 million; and MIT Sloan School of Management, hardest-hit of all, made $1,329,250, but could have made 1,778,000. In fact all the M7 schools were in seven-digits in terms of income from app fees, the only schools to claim that among Poets&Quants’ top 100 U.S. B-schools — and all got whacked big-time by the decline in apps from 2021 levels. Across the top 10 in P&Q’s 2024 MBA ranking, B-schools made nearly $10 million combined from full-time MBA application fees, ranging from $200 to $275 per applicant, paid by 39,584 applicants in the 2022-2023 cycle. Of those applicants, 4,411 — about 11% — eventually enrolled. MIT SLOAN LOST THE EQUIVALENT OF 2 TENURED PROFS’ SALARIES The top business schools make a lot from MBA application fees. But they could be making a lot more — and would be, if app rates had stayed at 2021 levels. After two straight years of app declines, the cost to B-schools in fees alone has been mounting — see table below. There are strong indicators, however, that the slump began to turn around in the just-completed 2023-2024 cycle. Sources tell P&Q that apps were up by more than 50% at NYU Stern School of Business and 20% at Virginia Darden School of Business this past year, and that Yale School of Management was also up by double digits. This suggests a widespread turnaround — welcome news for the schools, because a P&Q analysis of data released by U.S. News as part of its 2024 MBA ranking shows that across the top schools, including 17 of the top 20 as ranked by P&Q, the estimated total loss from app fees alone in the 2022-2023 cycle was $3,444,990. (Here’s where we add the caveat that app fees are often waived on a case-by-case basis, which is why all these numbers are estimates.) The worst-hit schools were the M7 — partly because the M7 had the most the lose: Harvard went from 9,773 apps in 2021 to 8,149 in 2023, for a loss of $406,000 Stanford went from 7,367 apps in 2021 to 6,190 in 2023, for a loss of $323,675 Wharton had 7,338 apps in 2021, and 6,193 in 2023, for a loss of $314,875 Columbia 6,535 apps in 2021, and 5,430 in 2023, for a loss of $276,250 But by far the biggest loser was MIT Sloan, which had 7,112 apps in 2021 and just 5,317 two cycles later; at $250 per app, in 2023 Sloan would have made $1,778,000 if it had maintained the previous app volume. That’s a loss of $448,750 — or the equivalent of about two tenured profs’ salaries, according to Glassdoor. APP FEE INCOME LOSSES IN 2022-2023 AT 20 LEADING U.S. B-SCHOOLS 2024 P&Q Rank School Application Fees 2022-2023 Applicants 2022-2023 Estimated Income From Fees Applicants 2020-2021 Estimated Lost Fee Income 1 Stanford GSB $275 6,190 $1,702,250 7,367 -$323,675 2 Harvard Business School $250 8,149 $2,037,250 9,773 -$406,000 3 Dartmouth (Tuck) $250 2,009 $502,250 2,463 -$113,500 4 Columbia Business School $250 5,430 $1,357,500 6,535 -$276,250 5 Yale SOM $250 3,076 $769,000 3,877 -$200,250 6 Duke (Fuqua) $225 3,292 $740,700 3,762 -$105,750 7 Cornell (Johnson) $200 2,553 $510,600 2,105 +$89,600 8 Virginia (Darden) $250 2,834 $708,500 3,057 -$55,750 9 Michigan (Ross) $200 2,976 $595,200 4,003 -$205,400 10 New York (Stern) $250 3,075 $768,750 3,958 -$220,750 11 Chicago (Booth) $250 4,184 $1,046,000 5,037 -$213,250 12 Northwestern (Kellogg) $250 4,316 $1,079,000 4,632 -$79,000 13 UCLA (Anderson) $200 2,182 $436,400 3,085 -$180,600 14 MIT (Sloan) $250 5,317 $1,329,250 7,112 -$448,750 15 UC-Berkeley (Haas) $200 2,904 $580,800 3,841 -$187,400 16 Carnegie Mellon (Tepper) $200 1,786 $357,200 1,962 -$35,200 17 Washington (Foster) $85 830 $70,550 839 -$765 18 Rice (Jones) $200 1,178 $235,600 867 +$62,200 19 Texas-Austin (McCombs) $200 1,889 $377,800 2,102 -$42,600 20 North Carolina (Kenan-Flagler) $150 2,064 $309,600 1,494 +$85,500 21 Vanderbilt (Owen) $200 1,410 $282,000 1,159 +$50,200 22 Southern California (Marshall) $0 3,166 $0 2,418 $0 23 Emory (Goizueta) $175 1,104 $193,200 1,000 +$18,200 24 Georgetown (McDonough) $175 1,428 $249,900 1,625 -$34,475 27 Georgia Institute of Technology (Scheller) $95 777 $73,815 559 +$20,710 31 Pennsylvania (Wharton) $275 6,193 $1,703,075 7,338 -$314,875 37 Indiana (Kelley) $75 1,163 $87,225 1,173 -$750 Source: U.S. News and B-schools NOT ALL B-SCHOOLS LOST GROUND IN APPS & APP FEES Outside the M7, losses ranged widely — from less than $1,000 at Rice Jones Graduate School of Business to more than $220K at NYU Stern. The latter had 3,958 apps in 2021; if Stern had maintained that, in 2022-2023, it would have made $989,500, or $220,750 more than it did. That’s roughly the salary of an associate professor. Among the other top U.S. B-schools with significant losses: Michigan Ross School of Business had 4,003 apps in 2021 and 2,976 in 2023 for a loss of $205,400 Yale SOM had 3,877 apps in 2021 and 3,076 in 2023 for a loss of $200,250 UC-Berkeley Haas School of Business had 3,841 apps in 2021 and 2,904 in 2023 for a loss of $187,400 Dartmouth Tuck School of Business had 2,463 apps in 2021 and just over 2,000 in 2023 for a loss of $113,500 Not all schools saw app declines, of course, and therefore not all schools lost money in app fees. Cornell Johnson Graduate School of Management gained 448 apps from 2021 to 2023, and gained $89,600 — perhaps enough to pay for an adjunct prof. Altogether in the top 25, six schools actually gained ground in MBA apps, led by Cornell and UNC Kenan-Flagler Business School‘s $85,500; the average gain for the six schools was $54,402. And then there are the schools that don’t charge any fee at all to apply to their full-time MBA programs. The highest-ranked is USC Marshall School of Business; it is joined in offering MBA applicants no-risk applications by Washington University at St. Louis Olin Business School, Southern Methodist Cox School of Business, Baylor Hankamer School of Business, Detroit Mercy College of Business Administration, and Willamette Atkinson Graduate School of Management. ACROSS 100 RANKED U.S. B-SCHOOLS, MORE THAN $20M IN MBA FEES COLLECTED The highest MBA application fee charged across the P&Q top 100 is $275 at two schools: Stanford and Wharton. Harvard Business School, however, at more than 8,000 applications and $250 per applicant, made the most from MBA apps in the 2022-2023 cycle: $2,037,250. Altogether, seven schools were in seven digits from MBA app fees in 2022-2023 — the M7, naturally. Twenty-eight schools across the top 100 were in six digits. The most common fee charged by a B-school in the P&Q 100 in 2022-2023 is … $100, charged by 14 schools. The highest-ranked school to charge $100 is Georgia Terry College of Business; but the lowest amount charged by a top-ranked school (outside of USC Marshall’s $0) is $85 at No. 17 Washington Foster School of Business. Some more data wrinkles: Top 10 average fee: $240 Top 10 average income from fees: $969,175 Top 10 total income from fees: $9,691,750 Top 25 average fee: $199 Top 25 average income from fees: $649,713 Top 25 total income from fees: $16,242,830 Top 25 lowest: (USC Marshall $0) Florida Warrington $30, Washington Foster $85 Top 25 lowest income from fees: Florida, $3,780 Looking at the top 50, the average fee shrinks to $147, with the average income dropping to $385,622 — though that is a very top-heavy number. The total from fees collected by the 50 top U.S. B-schools was $19,281,075. It’s quite a different picture in the bottom half of the top 100. The average fee there was $78, and the 46 schools for which there is available data made an average income of $18,694, and a total income of $859,943. The top total in the lower 50 was at Pace Lubin School of Business in New York City: $128,730. Pace and Hult International Business School ($101,460) were the only two B-schools in the lower 50 to reach six digits in fee income. It’s not very instructive because of the aforementioned top-heaviness of the data, but the average fee across the entire 100-school P&Q ranking was $113, and the average fee income was $209,802. And the grand total of MBA fees collected at all the schools: $20,141,018. See the next page for 2022-2023 application volume, fees, income, admits, and enrollment at the Poets&Quants top 100 business schools. Continue ReadingPage 1 of 2 1 2