To reverse an old cliché, it seems that what goes down, does eventually come back up. After several years in the doldrums, after the dotcom crash, service sector recession and 9/11, MBA recruiting is on the increase across the board. The world is still going through turbulent times – terrorism, oil price fluctuations and shifting of competitive advantage from developed economies to emerging economies like China. Yet, through all these shocks, the global economy is boomingcession in many regions. This is resulting in strong growth in demand for MBAs.
MBA education and MBA career opportunities have become truly global, attracting as much interest in Bombay and Buenos Aires, as they do in Boston or Brussels.
Many companies, in sectors ranging from banking, consulting, healthcare, utilities, transportation, technology and telecoms, continue to favour an MBA education, both for their own executives and as a source of new talent. In today’s economy, an HR manager in a large company anywhere in the world is expected to be informed and knowledgeable about the MBA marketplace.
The Global 100 Top Business Schools research provides the definitive list of business schools that attract the most international recruiters and seeks to benefit the internationally mobile MBA recruiter and seeker. Our carefully developed methodology encourages international recruiters to select the schools they consider for MBA hiring purposes. By excluding recruiters that focus only on domestic hiring, we recognise that many excellent schools that cater primarily for a local recruitment marketplace, do not appear in the research. This research is intended to benefit the internationally mobile MBA recruiter and seeker.
As the MBA qualification becomes more global, we are becoming aware of a growing number of HR managers in Asia, Latin America and Eastern Europe, who are informed about MBA education. We have also asked these managers to share their views on the MBA programmes they would prioritise for MBA hiring. MBA recruiting is no longer the domain of a few prestigious US and European companies.
This data provides an insight into which are the Global 100 Top Business Schools from the point of view of HR managers and recruiters worldwide, last year. Given that most MBA students take an MBA to enhance their career, we believe this research offers a unique insight in to the value of an MBA. This approach distinguishes itself from rankings: the research does not rank schools, but identifies which are the most popular schools in each region of the world among international recruiters: Asia Pacific, Europe, Latin America and North America.
With increased recruiter activity, we have seen the traditionally strong business schools produce impressive results in terms of employer recognition and usage. At the same time, this growth in global demand for MBAs has resulted in several recently established MBA programmes at traditionally strong universities performing well as they leverage their recruiter contacts.
In North America, Harvard Business School (Harvard) and The Wharton School (Wharton) remain the most popular schools. Both schools suffered a dip in popularity in the early part of the decade, especially when Wall Street was suffering, but have bounced back. Duke has been the highest climber amongst top-tier US schools in recent years. The growing reputation of this school is finally beginning to penetrate into the minds of top recruiters who, for the first time, are consistently placing Duke on their lists of top ten US business schools.
Another feature of the research this year has been the strong performance of Canadian schools. McGill, in particular, has performed well, but so have British Columbia, Queen’s Toronto, Western Ontario and York – all have received strong support from diverse companies outside of Canada, which has helped push these schools into prominent positions in this research.
In Europe, INSEAD and London Business School (LBS) remain the most popular business schools amongst recruiters, benefiting from the recovery in consulting and banking. Progress is being made by Spanish, German and Swiss schools, which are succeeding in attracting recruiters. IESE and IE (Instituto de Empresa) are two Spanish schools which have shown a strong increase in performance in the last couple of years and now feature amongst the top ten European schools. In the last two years, many new schools in Europe have emerged as strong players. Just as did Oxford and Cambridge a few years ago, the development of MBA programs at famous universities like Mannheim, MIP Politecnico di Milano, Copenhagen, Stockholm School of Economics and HHL Leipzig has resulted in these schools moving up our tables quite rapidly – all have joined the list of 40 most popular schools in Europe in the last three years. The research enables recruiters to select executive MBA programs, some of which have performed well in Europe - St. Gallen, WHU Kellogg are examples. For the first time, two Central European schools have appeared in this research – CEU in Hungary and Moscow State University – reflecting the strengthening and growing importance of the Central European and Russian economies.
Asian schools are strengthening their role in the MBA market. More and more recruiters are willing to hire locally from the region. The presence of the INSEAD campus in Singapore is helping this trend, as is the emergence of several Australian institutions as international-class business schools. Last year, for the first time, fifteen Asia Pacific business schools (including Australia) qualified for the overall global 100 top schools, based on level of response and interest from recruiters (at the same time, the number of qualifying North American schools fell by five).
As North American schools have recovered as demand has picked up at home, so we have reverted to just 10 schools in Asia, once again. However, if current trends continue, we predict there will soon be twenty business schools in Asia which will be able to call themselves part of the Global Top 100.
Latin America has remained stable in terms of the number of recruiter respondents and the evaluation of schools. However, IPADE has pipped EGADE Tec de Monterrey as the most favoured school in the region. IAE in Argentina has also performed well this year. Fundação Getulio Vargas (FGV) has gradually been dropping down the table in recent years. Interest in Latin American schools from recruiters based outside the region remains limited.
The MBA recruitment market place is dynamic and cyclical. This is the year when China and India have really begun to make their mark on MBA recruiting. Globalisation is making the MBA market dynamic.
Salaries in China and India may be significantly lower than in developed regions, but many MBAs are choosing to work in these countries, believing that entrepreneurial opportunities outstrip those in developed regions. In addition, regions like Central Europe, Germany, Spain, Australia, South East- Asia, which have not been known for MBA hiring, have started absorbing large numbers of new MBA graduates. We predict that MBA recruiting in parts of Asia, Latin America and Central Europe will start catching up with the more mature US and Western European markets. We expect to see many strong business schools emerge from these regions in the next few years and many more recruiters to become active.
Salary Equalisation
The reputation of elite schools stands them in good stead around the world. The research confirms that there are 10 - 20 schools in the US and 10 - 20 schools in Europe, of which almost all international recruiters are aware and would favour for MBA hiring purposes. These schools feature on the priority lists of a high proportion of respondents. However, when it comes to agreeing salaries, the high salaries demanded by graduates of these schools put off many smaller firms. As a result, recruiters turn to strong local schools. There is a differential in salary levels between elite schools and strong local schools and this is helping to sustain demand for graduates from a wide number of institutions. It is also true that the elite schools have limited numbers of places and therefore competition for entry is tough. As a result, many good candidates decide to study at less well-known schools and to undertake a pro-active job search. Recruiters may not go on campus to many schools, but they will review CVs of candidates from almost any school.
Strong candidates at smaller schools are helping to build the reputations of these schools. There are strong local business schools emerging in Canada, Germany, Russia, Australia, China, Japan and several other countries that may soon start to challenge the existing incumbents.
The upswing of the business cycle continues
The MBA market has shown itself to be cyclical. Recruiter demand for full time MBA hires fell back each year from 2000 to 2003. The downturn that affected the telecoms, media, consulting and banking sectors resulted in fewer places for MBAs within large companies. But the recovery is well established. We have seen a 15% increase in demand, a 9% increase in average MBA salaries and this is before an uplift in the technology sector.
Small is beautiful
Many small and medium sized companies founded in the last decade by entrepreneurial MBAs have been hiring the current class at affordable salaries. It is too soon to say whether this trend will continue as MBA salaries begin to rise once again. Feedback from career services in particular suggests that alumni hiring remains an important source of new job opportunities for MBA graduates.
These small businesses are lending a dynamism to the current MBA market. More MBA alumni are coming back to hire new MBAs in order to give their businesses the necessary professional management skills to progress to the next stage. In compiling this research, the researchers have benefited from access to Global-Workplace (www.global-workplace.com) that provides a recruitment platform for alumni seeking to hire from international business schools, or themselves seeking to be hired.
Off-campus as well as on-campus
Even students from second-tier schools are not having to put some effort into their job search this year. Top-tier MBAs can they count on receiving two or more job offers. And the outlook for the MBA market remains optimistic. Just as we observed in America 20 years ago, many Asian and European companies now begin to regard the MBA as an essential management entry-level qualification.
Without an MBA, it is almost impossible to become an Associate at a top investment bank, or a Senior Consultant at a top consulting firm. Students are having to develop new job-search techniques rather than rely on on-campus interviews. Good interpersonal skills have become more important than ever before to ensure job-hunting success.
The latest TopMBA.com Global 100 Business Schools Report is available at the TopMBA bookstore now!
Source: QS TopMBA Career Guide
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