The everlasting question that worries every MBA applicant – is it worth it to take up an MBA course? Let’s see what the statistics say. Surveys are a very important tool in business because they show the trends and that is of great help to those in search of the right career path. Often, they affirm a long-held hunch, but sometimes they can challenge stereotypes. But which is the case with MBAs?
Last month, the Graduate Management Admission Council (GMAC), the owner of the GMAT exam, released its annual survey of business school alumni around the globe. Though many findings were expected, there were some interesting results we are about to take a look at.
One example of a finding that went against the stereotype is that younger MBA graduates are more likely to start their own business than their older counterparts. According to Gregg Schoenfeld from GMAC, who oversaw the survey, the typical MBA entrepreneur is aged 43. However, that may be changing.
A previous poll of alumni in 2014 found out that 5% of recent MBA graduates were entrepreneurs, while 23% of those who had been out of business school for a prolonged period of time had started up their own business. This year, however, 45% said they started their business on graduation. Recently it seems that alumni want to jump into entrepreneurship faster than their predecessors. And it is proven that the longer they have been in business after their MBA, the more likely they are to start up their own company.
Motivation for MBA studies
Of particular interest to the wider business school audience, however, is the reason why MBA students decided to undertake their course in the first place. While 60% said that a pay increase was part of their motivation for undertaking an MBA course (and 95% of them were satisfied that they achieved that), significantly more—three in every four—said that they decided to undertake an MBA for personal development.
Return on Investment
All that said, there are certainly significant financial benefits to investing in a business school education. The average return on investment on a part-time MBA a decade after completing the course is 1,621%, according to GMAC’s survey. Alumni typically will have recouped their initial outlay on a degree within four years of receiving their qualification. Yet that good news seems to have passed alumni by. Of the same part-time MBA graduates, 93% say they found their course personally rewarding—but just seven in 10 found it financially so.
Only one in 20 new MBAs accept an entry-level job, compared with a quarter of those who graduate from a specialised master in business. Yet just two-thirds of business school alumni say they are satisfied with their current job, leaving a surprisingly large chunk of people shuffling their feet under their desks. So why are MBAs apparently so unhappy with their positions? Perhaps it is simply that they are so impatient to get on. The higher up the career ladder graduates go, the happier they feel, found the pollsters. At GMAC they have a saying, explains Mr Schoenfeld:
Business education ages like a fine wine.
So to go for an MBA or not – the decision is all yours. But one thing is for sure – you will definitely gain a great deal of knowledge if you decide to enrol in an MBA course and that is something that is worth investing in. In addition, your CV/resume will definitely look much catchier with an MBA degree on it!
Source: The Economist