Wharton students walk along Locust Walk at the University of Pennsylvania. Courtesy photo

5) Wharton’s No. 1 Rank: It’s All About Jobs In A Tough Year

Wharton is no stranger to number one rankings. This is the sixth time in the past 12 years of U.S. News rankings that the University of Pennsylvania’s business school has occupied the top spot. In four of thoee chart-topping years, Wharton had to share honors with either Harvard or Stanford or in one year both. But this year Wharton can claim sole possession of first place.

How did it do it? When you tear apart U.S. News data points, it all comes down to employment. Stanford, which tied with Wharton for first last year, beat the school on starting pay which accounts for 30% of the ranking. It also beats Wharton by a mile on acceptance rate, 6.8% at Stanford vs. Wharton’s 20.5%. Stanford also had an edge on the entering class’ median undergraduate grade point average, 3.8 for Stanford, 3.6 for Wharton. But the admit rate is only weighted a measly 2%; and undergraduate grades make up 10% of the ranking.

On employment, however, it was not a close call. The gap between Wharton MBA grads and Stanford grads is massive. Wharton’s performance on placement was 18.6 percentage points better than Stanford at graduation and 9.8 percentage points better three months after commencement. And employment makes up 20% of the entire ranking.

Problem is, employment rates can be interpreted differently. Like Harvard MBA grads, who also posted low employment rates, Stanford MBA grads tend to be very picky. They often go for jobs that do not hire MBA grads by the boat load. These jobs in private equity, venture capital, hedge funds, and early stage companies do not hire on an academic calendar. They hire on need. And when they do hire, it’s one or two MBAs a firm. So landing those jobs often takes more time and effort.

Of the 37% of students who went into finance from Stanford last year, only 2% went into investment banking vs. the 11.5% at Wharton. Some 20% of Stanford MBAs took PE jobs (compared to Wharton’s 8.8%), 9% in hedge funds and investment management (vs. 7.8% at Wharton), and 7% in venture capital (vs. 5.9%).  And then there is a stronger preference at Stanford for startups and early stage companies. In fact, 23% of the Class of 2024 launched their own ventures upon graduation

It’s why you can’t take any ranking at face value.