MBA careers: Nothing special

MBAs are no longer rare, and no longer prized by employers

Finding a competitive edge is an obsession for those looking to take an MBA. Prospective students spend hours researching the minute details that will take their application from the middle of the pile to the top, and land them a place at a business school that promises plentiful rewards. But what if they were wasting their time?

Naysayers claim that the preponderance of institutions around the world that offer an MBA, or something approximating it, has resulted in a decline in teaching standards. Only 7% of graduates from India’s 5,500 business schools are employable upon graduation, according to one study. Others disagree. It is not that the MBA has become any less rigorous. Rather, easier access to an MBA programmes has changed what the MBA means to employers.

Debbie Goodman-Bhyat, the boss of Jack Hammer, a South African headhunter, says she is all for jobseekers trying to become better qualified. However, she goes on, firms no longer see an MBA as a differentiating factor, unless it was obtained at one of the world’s best business schools. Not only are more business schools now offering MBAs, but there are also a multitude of different ways to study. Online MBAs are increasing in popularity, and the number of part-time courses helps those who would not be able to devote time to a full-time programme, due to family or work commitments, to undertake their qualifications. Simply put, MBAs are no longer rare, and as such are no longer a guarantee for employment.

MBA programmes are marketed as a shortcut to higher earnings. Often they are. According to data from the last ranking by The Economist, recent MBA graduates can expect to increase their salary by 79%. Yet that requires locating a job in the first place. And appending “MBA” to the name at the top of a CV no longer guarantees employment. In America, the number of MBAs awarded by business schools has increased sevenfold from 1970. Nearly 200,000 students from American institutions have been awarded Master’s degrees in business every year since 2010. The employment market has a job to keep up.

“The MBA shouldn’t be the obvious choice”forjobseekersinbusiness,Mrs Goodman-Bhyat says, because the threelettersnolongerholdtheprestige they once did. Other Master’s-level qualifications may better serve some people in their search for an executivelevel job, she adds. Indeed, although 45% of South Africa’s top 40 chief executives have a Master’s-level qualification, according to a Jack Hammer survey, less than half of those hold an MBA.MBAsareparticularlyusefulfor liberal arts graduates looking for a business degree at Master’s level, but Mrs Goodman-Bhyat believes that any other high-quality post-graduate business degree can do the same job.

This seems to be borne out by statistics elsewhere. Fully 20% of business-school graduates told the Graduate Management Admission Council, a business-school body, that their course did not improve their earning power. With MBA programmes costing $100,000 or more at the best schools, careful consideration must be given to whether possessing the degree will really make a candidate stand out in the cut-throat job market. Perhaps, in a world where it seems practically everyone holds an MBA, being the lone person without one may make you stand out. The Economist