MBA Application Numbers Reach "Turning Point"

Posted by: Geoff Gloeckler on August 25, 2010

A study released today by the Graduate Management Admissions Council (GMAC) confirms the MBA application “sputter” that was first reported by Bloomberg Businessweek on August 12. According to GMAC’s annual Application Trends Survey’s findings, only 44 percent of the 476 MBA programs that were surveyed reported gains in the number of applications they received for the entering full-time MBA class, compared with 66 percent last year and 70 percent in 2008. Of the respondents, 47 percent reported a decrease in applications, with a surprising 9 percent reporting drops of more than 20 percent over 2009.

According to the release, “The cyclical nature of application volume trends is not new to graduate management program admissions professionals. After several years of strong growth, the number of applications typically reaches a high point and trends down afterwards. We are witnessing slight decreases in most programs. It appears that full-time MBA programs have reached this turning point.”

As was described in the earlier Businessweek story, the decline in MBA application numbers can be directly attributed to the economic woes the country has experienced over the past few years. “Last year, the financial crisis brought more people to seek further education. This year, as the economy picked up, the applications are more realistic,” explained one survey participant in the GMAC report.

Interestingly, part-time and executive MBA programs are not experiencing the same drops. Part-time application numbers remained flat compared with 2009, while EMBA application numbers experienced a significant jump, with 59 percent of schools reporting an increase in application numbers, compared with 37 percent in 2009.

For B-schools, this is a good sign, as EMBA programs are traditionally big money makers. Also, it may be a good sign for the economy, in general, as the large rise in EMBA applications may indicate a willingness on the part of companies to begin sending employees to EMBA programs again, a practice that all but disappeared over the past few years due to the high program costs.

Reader Comments

Nikhil Abraham

August 30, 2010 12:52 AM

The trend is that when the economy is bad, the opportunity cost of graduate school goes down, and so applications rise.

Aaron Barnes

September 17, 2010 12:26 PM

Your survey participant must be smoking something because there is no improvement in the economy overall unless your were a census worker. Although the opportunity cost of graduate school may go down as the economy become worse, it is not a direct correlation. As more people were out of work in 2009, fewer could afford to attend an MBA program because their spouse also lost their job? We now know in Sept. that Aug., when this article was written, home foreclosures were at record levels. It's hard to concentrate on school when you are worried about your children having something to eat and a place to live.

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