There’s good news and not-so-good news in the latest report from the Graduate Management Admission Council: MBA demand is expected to continue to be high in 2019, but for international students seeking employment in the United States, the picture is likely to be much grimmer — even more than it was in a very grim 2018.
About that good news: In the poll of 350 employers, of which 289 were U.S.-based, GMAC found that 78% plan to hire recent MBA graduates in 2019, keeping pace with the share that made MBA hires in 2018 (77%). Meanwhile, showing the value of graduate business education in general, a greater share of employers plan to make 2019 hires among Master of Data Analytics (41%) and Master in Management (37%) graduates compared with 2018 hiring (36% and 32%, respectively). The good news extends to pay, as well: GMAC found that most employers plan to increase the starting base salaries of new B-school hires in 2019 at or above the rate of inflation compared with the base salaries offered to new hires last year. Nearly half of companies planning to hire data analytics grads say they will do so.
“Companies are always looking for talent to assist them in meeting their organizational goals, and with a tight labor market in the United States, it is not surprising that salaries are keeping up with and surpassing the rate of inflation,” Gregg Schoenfeld, GMAC senior director of research and author of the newly released Year-End Employer Poll Report, tells Poets&Quants. “This is especially true among companies seeking out data analytics talent.”
UNCERTAINTY CONTINUES IN U.S. OVER IMMIGRATION, VISA POLICIES
GMAC’s poll of companies in 26 countries was conducted between November 9 and December 3, 2018, and released this month. The findings show that international hiring will continue to be a problem area for employers in 2019 — particularly in the U.S., where 33% of employers report hiring international business school graduates requiring legal documentation in 2018, down from 42% in 2017. Among U.S. employers that made international hires in 2018, only 55% plan to make such hires in 2019.
While overall most U.S. employers do not plan to hire international candidates in 2019 (56%), a recent proposal from the U.S. Department of Homeland Security to increase the number of H-1B visa recipients who have master’s degrees may impact employers’ plans.
“With the uncertainty in the United States concerning immigration and visa policies, it is understandable that U.S. companies are hesitant to make plans to hire new employees that require additional legal documentation,” Schoenfeld says. “However, with the proposed changes to the H1-B visa program, opportunities for graduate business program graduates may increase in the United States. We will have to wait and see how these policies play out.”
‘FEWER INTERNATIONAL HIRES COULD RESULT IN A WEAKER ECONOMY’
Bill Boulding, dean of the Duke University Fuqua School of Business and chair of GMAC’s board, has been a vocal proponent of easing restrictions on international business students seeking to study and work in the U.S. He says most of the new report is welcome news — and the need for talent will, hopefully, in time reverse the trend of international students losing ground with employers.
“I’m pleased, but not surprised, to see that even more employers plan to hire business school graduates this year,” Boulding tells P&Q. “Our quarterly survey of chief financial officers shows difficulty hiring and retaining qualified employees remains a top concern among CFOs. It’s clear from our data that more talent from business schools is needed to fuel company growth — which then leads to economic growth in any given region. In terms of trends, I expect the hiring of business school graduates to continue to increase in the tech sector this year.
“Because talent is so critical to the success of a company and an economic region, my hope is that business education programs that have secured STEM (science, technology, engineering, and math) designation will be able to help provide a path to allow U.S. companies access to the international talent needed to grow both firms and the U.S. economy. STEM designation means the student visa itself allows for three years of employment opportunity in the U.S. for STEM-related jobs — without the need to obtain a work visa. Of course, during the three-year window, students have the opportunity to apply repeatedly for an H1B visa if they desire a longer work stint in the U.S.
“We are pleased at Duke that both our Master of Quantitative Management program (MQM:BA) and the Management Science and Technology Management (MSTeM) certificate in our full-time (Daytime) MBA program have this designation. We hope Duke and other schools with STEM designation will help reverse the data GMAC has noted in this report of employers indicating they will hire fewer international students. Beyond opportunity for business school students, access to international talent is also an economic development issue and fewer international hires could result in a weaker economy.”
NEARLY HALF OF COMPANIES HIRING DATA ANALYTICS GRADS TO PAY AT OR ABOVE INFLATION RATE
Other key findings of the GMAC poll:
• Among the employers planning to increase the starting base salaries of new business school hires in 2019 at or above the rate of inflation compared with the base salaries offered to 2018 new hires, nearly half of employers (47%) of new hires from Master of Data Analytics programs say they will do so, more than any business school graduate type. Twenty-four percent of employers plan to increase above the rate of inflation the starting base salaries of new MBA hires.
• While a greater share of large companies plan to make MBA hires in 2019 compared with small companies (94% versus 50%), a greater share of small companies plan to increase the magnitude of their 2019 MBA hiring compared with last year (34% versus 44%).
• Employers continue to regard the value of a graduate business education highly. Overall, nearly 9 in 10 responding employers say the value is very high or above average (86%). Large employers and companies based in the United States tend to rate the value the most highly. By industry, companies in the healthcare, manufacturing, and technology sectors are the most likely to rate the value as very high.