Bear Market - how does it affect your MBA Plans?

Question

And here we are - the Bear Market - how does it affect your MBA Plans?

If you are applying or already matriculating. Are you impacted? Are you MORE or LESS likely to attend BSchool now?

-bb

AnirudhaS · Answer

Get your mbas done just before the market turns bullish. Its much easier to get jobs when the market is doing well.

ari.banerjee · Answer

I’m contemplating. 
I’ve seen my B school savings/investments disappear in 2 weeks. Not sure if I wanna take up a huge loan now or cash my investments at such a low return.

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MBADecoder · Answer

bb , do you have any stats to share on application volumes during a recession? I guess GMAT Club was young and upcoming when the last recession happened, so the data may not be there.

It would be nice to know how people from different countries react to doing an MBA during a recession. Currency devaluation, risk of getting jobs and the ever-pervasive visa issues are definitely going to be on international applicants' minds.

unraveled · Answer

Bear markets certainly impact negatively. Whether its savings or investments it doesn't matter. The last slowdown(calling recession is better) of 2007-08 had impact on college placements. Having seen it first hand when many of my friends were sitting ideal even after getting job offers since they were deferred or cancelled. Consequently, many who wanted to go for Post graduation after a while prepared and completed their higher education early. Many who could not afford opted not to do since earning mattered.

Recession was structural in nature - more problematic than today's slowdown. It was a reaction while this time its more of a precautionary in nature. Before that, in 2002-03, there were disruptive changes in industry overall - my opinion here might be naive since i didn't know anything back then.

Coming to the application part, yes savings/investments are impacted thus its now that i would apply(don't have options left) for relatively less dearer Bschool or less number of applications than had my investments not taken a hit. Practically, recovery from this point is going to be very hard(slow and painful) so i have only option to limit my applications and geography as well.

Difficult times..!!

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xprometheusx · Answer

From my understanding bear markets usually results in more applications. It is in a good market that applications drop because applicants have more options and the opportunity cost of an MBA is much higher. Also depending on the interest rate of loans, it may be beneficial to leave your money in the market and take out loans because your investments if you hold will outperform any loan interest. See the 08 crash. Per CNBC The index has delivered a 10-year annualized total return of 17.8 percent since its financial crisis bottom in March 2009.

Long story short, for me given my age, and confidence that I can find a job coming out, I am still going to school this year. I think students next year will be in prime position to come out of any potential recession but will probably face a more competitive pool (depending on how Covid 19 shakes out)

Long story short, for me given my age, and confidence that I can find a job coming out, I am still going to school this year. I think students next year will be in prime position to come out of any potential recession but will probably face a more competitive pool (depending on how Covid 19 shakes out)

Bear Market - how does it affect your MBA Plans?

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