The Graduate Management Admission Council (GMAC) recently released a new study of MBA applicants, taking a close look at who applies to MBA programs, when they typically apply, and their most common reasons for applying. While the whole report (PDF) is worth a read, the particular finding that’s generated the most headlines is the fact that just more than half of applicants stated that the state of the economy had no bearing on their decision to enroll in business school, while a little more than a third (36%) said that the soft economy increased their likelihood of pursuing an MBA.
The headline that GMAC and most media outlets have promoted has been that first point — that half of applicants said the economy has had no impact on their plans. For the majority of them, applying to business school has been something they have been planning for a while. That the economy is good or bad makes their job easier or harder in the year they apply, but they were going to apply, anyway.
Think of the entry-level analyst at an investment bank… Putting in his time, getting his ticket punched, knowing that he almost has to leave in another year. He’s been studying for the GMAT a few hours here, and few hours there, and this fall is when he is going to apply. If the economy suddenly comes roaring back, he could walk up and down Wall Street and find a job at another bank, but he knows what sort of life is in store for him if he doesn’t pursue an MBA now. He’s still going to apply.
Or, the economy takes a dramatic turn for the worse and our fearless analyst suddenly has a lot more competition from displaced bankers. His ship is still sailing — he’s still going to apply — but perhaps he’s now tempted to take the GMAT again to tack another 40 or so points on to his score, or he plans on applying to seven schools instead of just four, to be safe. Again, the macro climate certainly affects his plans, but not whether he applies or not. It does affect how he goes about the application process, though.
We’d be interested in getting at that question more — not whether or not someone applied to business school (or to law school, or medical school) because of the state of the economy, but how the economy affects someone’s specific plans given that they’re already going to apply.
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