At the University of Pennsylvania’s Wharton School, close to eight of 10 MBA students say they are not excited about the coming fall semester because the coronavirus pandemic has forced classes online. At UCLA’s Anderson School of Management, newly admitted international students are outraged that they cannot defer their admission to the school’s MBA program even if they cannot get a student visa to come to the U.S. At New York University’s Stern School of Business, students are demanding the reversal of a 3.5% increase in MBA tuition during COVID-19 and asking for a 5% to 10% discount on the price of their degrees because of the shift to virtual classes.
Add to all of the anxiety and frustration the fact that some graduates from the most prestigious business schools, including Harvard and Stanford universities, saw their summer internships and full-time job offers clawed back by companies due to the COVID recession. Many more are deeply worried about their prospects for landing a job over the next year as still more companies freeze budgets and hiring plans.
So is this a time to apply to an MBA program and go even further into debt? You better believe it is, and here’s why.
The Class of 2023 will inevitably graduate into a fully recovered economy, better prepared to take full advantage of the upturn.
A recession and a health crisis, no matter how severe, will not last forever. But while it lasts, many will find their opportunities to advance at work diminished or completely curtailed. Many more have already found themselves on unemployment. By the time this year’s incoming MBA students graduate in 2023, it is almost a certainty that both COVID-19 and the economic downturn will be in the rearview mirror. The Class of 2023 will inevitably graduate into a fully recovered economy, better prepared to take full advantage of the upturn.
No less crucial, they will have been the beneficiaries of not merely the business basics or of the leadership development a strong MBA program provides; they will be steeped in both data analytics, specifically how to smartly harness massive datasets for decision making, and how to leverage new technologies, such as artificial intelligence and machine learning, to gain important efficiencies in a business moving forward.
Of all the graduate degrees you could earn, an MBA from a highly selective business school is pretty much a no-brainer investment. The top five schools for average starting pay last year — base salary plus signing bonus — are all big names, led by the Wharton School at $172,016, NYU Stern ($168,291), Stanford ($168,226), Dartmouth College’s Tuck School of Business ($166,251), and the University of Virginia’s Darden School of Business ($165,292). In all, 12 schools in the top 25 of U.S. News’s MBA ranking report starting salaries above $160,000, and 17 above $150,000.
“If you stayed at work in 2021, your career options and earning potential in 2023 would be more limited if you had gone to business school,” noted Soojin Kwon, managing director of full-time MBA admissions and program at the University of Michigan’s Ross School of Business. Why? Kwon notes that students will gain three advantages by going back to school that they won’t get by staying in a job during the pandemic.
“One, you’ll meet with and learn from hundreds of smart, ambitious and interesting people you wouldn’t have met if you didn’t go to business school,” Kwon said at a recent panel discussion for Poets & Quants. “Two, you’re going to learn how to network and interview for jobs in an industry or function that you’re interested in going into, and most, if not all MBA recruiters this year are planning to do virtual recruiting. So you’re going to learn how to interview in the format in which recruiters are going to be recruiting.
In addition, she said, “You’re going to gain access to a network of tens of thousands of business school alumni and hundreds of thousands of alumni in the broader university community. You could absolutely find another job through LinkedIn, but it’s no secret that you’re more likely to get a response if you have some kind of connection, and an MBA from a top school with the support of alumni provides that invaluable connection for life.”
During the Great Recession of 2008-2009, the job situation was just as miserable and prospects for many MBAs appeared so dim that some openly questioned their decision to borrow money to get the degree. Robert Bruner, then dean of the University of Virginia’s Darden School of Business, found himself having to defend the value of the MBA. He rose to the challenge, and his points then made much sense now.
Education adds significant value to human potential. “Generally, research finds real rates of return on investment upwards of 10% and as high as 50%. And there is a correlation between years in school and earning power but that’s only the quantitative part. Every year, students graduate who are more self-confident, better communicators, and more promising leaders than when they enrolled. And they have joined an alumni network that has helped in good times and bad.”
Indeed, long-term thinking beats short-term thinking all the time. Young professionals have a long career ahead of them. “With the benefits of modern medicine, you can probably look forward to a career of 50 years,” Bruner wrote. “Are you judging the worth of an MBA by only the first job you get out of B-school? Take the long view. If you could discount the marginal benefits of an MBA from a competitive school over the next 50 years, I’d guess that they well exceed the costs. Don’t discount the future too steeply.”
Truth is, you can bet with certainty that tough times will again appear once this pandemic is under control and the economy recovers. The ability to assess and bear sensible risks is the core of business and entrepreneurship. Pursuing a graduate degree in business to learn valuable skills, cultivate one’s leadership potential, and acquire a supportive network of connected professionals is a risk worth taking.
John A. Byrne is the founder of C-Change Media, a global digital media company of higher education content including Poets&Quants.com, a website for applicants to business schools.