B-schools experience surge in applications
David Spencer, Sloan
Issue date: 11/12/01 Section: Features
You may have read about it in the Economist or Wall Street Journal. You might have surmised it from some of your friends losing their jobs. Business schools across the country are experiencing a surge of inquiries and applicants.
Though it is barely past the first admissions round at most schools, there has been a sharp increase in both attendance at recruitment sessions and requests for application materials, the two best early indicators of a bigger pool of applicants. The number of potential applicants taking the Graduate Management Admissions Test (GMAT) is also up more than 20% from last year.
The reason is two-fold: pent up demand and the softening economy. During the “dot-com” craze people were not only delaying getting master’s degrees in business, but also those attending felt pushed to leave early. It was truly a “gold rush” mentality and fewer people wanted to sustain the opportunity cost of an education when new millionaires were being minted daily. Now that the economy has slowed, many of those individuals realize they need to sharpen their skill set, even if it means applying before assimilating enough work experience.
What a difference a year makes. Many young people now seem to view an MBA as, if nothing else, a security investment with higher pay down the road. The irony of this is hard to ignore when one considers the time, money and preparation applicants will devote to the submission process only to find that a huge number of their peers have the same idea. If this trend continues, the fiercer competition will drive down acceptance rates at top schools, which have been 10 to 15% during the past couple of slower years (even lower at this distinguished institution).
Though this increased interest appears to be mostly an MBA trend, what affect might it be having on other business school offerings that have just one admission round such as the Stanford Sloan and PhD programs? How are next year’s application numbers shaping up all around the GSB? The Reporter talked to the three programs.
“There is no question that business school applications, in general, will be up this year.” says Derrick Bolton, our new MBA admissions director. “Prospective applicants have consistently told me that on the road, and they're the best source for information. However, they also tell me that Stanford has a peculiar “problem” due to our selectivity. Potential applicants opt out of our process even when they think applications will be normal (high single digit acceptance rate) - and when they think applications will be up, lots of people don't even bother applying here.”
In short, it seems too early to tell what effect, if any, increased nationwide applications will have on the Stanford MBA pool and it is school policy not to divulge round by round statistics. “Besides,” Bolton adds “the volume of applications doesn't really matter to us at all. Our efforts are wholly focused on getting the right people to apply, not on getting everybody to do so. So we don't take application volumes as a sign of success or failure, either way.”
According to Sloan director Bruce McKern, “interest in the Sloan program is as strong as ever. This is a fortunate thing when you consider that, since our Fellows are sponsored by their companies, we might expect economic slowdowns often to lead to fewer applications, not more. However, the Sloan Program is an investment in a company’s future and many companies take a long-term view on the development of their leaders Of course, we are concerned that the quality of Sloan Fellow be as strong as in the past and we will not be able to judge this until all the applications are in”
The PhD program staff tells us that although it is too early to know whether the number of applications this year will show an increase, inquiries to the program are up this year. With a January 2, 2002 admissions deadline, they have already distributed their entire stock of 3,500 application packets. Elissa Hirsh, program administrator, explained, “because the PhD program is research-oriented with most graduate-placement being faculty positions in schools of business or related departments such as economics, the economic downturn may not be as immediate an indicator of the number of PhD applicants.”
A large number of the Sloan and PhD program participants are international, which makes them vulnerable to potential visa restrictions, another wild card in this year’s application process. Some members of local, state and national governments in the US have been threatening to restrict the number of incoming international students and more closely monitoring those that are here. This would be a loss for business schools in general and the multinational GSB in particular.
As for the MBA applicants, despite these uncertainties, those who are fortunate to gain acceptance to the top schools will still graduate into an unpredictable job market with debt that can approach $100,000. This year’s class is dealing with the most disappointing recruiting market in a decade and it will likely be years before we see a return of the recent thriving job market.
But, as one member of the GSB MBA class of 2002 put it, “the tool kit, friendships and contacts we make at a place like Stanford are priceless and will outlast any recession.”
Though it is barely past the first admissions round at most schools, there has been a sharp increase in both attendance at recruitment sessions and requests for application materials, the two best early indicators of a bigger pool of applicants. The number of potential applicants taking the Graduate Management Admissions Test (GMAT) is also up more than 20% from last year.
The reason is two-fold: pent up demand and the softening economy. During the “dot-com” craze people were not only delaying getting master’s degrees in business, but also those attending felt pushed to leave early. It was truly a “gold rush” mentality and fewer people wanted to sustain the opportunity cost of an education when new millionaires were being minted daily. Now that the economy has slowed, many of those individuals realize they need to sharpen their skill set, even if it means applying before assimilating enough work experience.
What a difference a year makes. Many young people now seem to view an MBA as, if nothing else, a security investment with higher pay down the road. The irony of this is hard to ignore when one considers the time, money and preparation applicants will devote to the submission process only to find that a huge number of their peers have the same idea. If this trend continues, the fiercer competition will drive down acceptance rates at top schools, which have been 10 to 15% during the past couple of slower years (even lower at this distinguished institution).
Though this increased interest appears to be mostly an MBA trend, what affect might it be having on other business school offerings that have just one admission round such as the Stanford Sloan and PhD programs? How are next year’s application numbers shaping up all around the GSB? The Reporter talked to the three programs.
“There is no question that business school applications, in general, will be up this year.” says Derrick Bolton, our new MBA admissions director. “Prospective applicants have consistently told me that on the road, and they're the best source for information. However, they also tell me that Stanford has a peculiar “problem” due to our selectivity. Potential applicants opt out of our process even when they think applications will be normal (high single digit acceptance rate) - and when they think applications will be up, lots of people don't even bother applying here.”
In short, it seems too early to tell what effect, if any, increased nationwide applications will have on the Stanford MBA pool and it is school policy not to divulge round by round statistics. “Besides,” Bolton adds “the volume of applications doesn't really matter to us at all. Our efforts are wholly focused on getting the right people to apply, not on getting everybody to do so. So we don't take application volumes as a sign of success or failure, either way.”
According to Sloan director Bruce McKern, “interest in the Sloan program is as strong as ever. This is a fortunate thing when you consider that, since our Fellows are sponsored by their companies, we might expect economic slowdowns often to lead to fewer applications, not more. However, the Sloan Program is an investment in a company’s future and many companies take a long-term view on the development of their leaders Of course, we are concerned that the quality of Sloan Fellow be as strong as in the past and we will not be able to judge this until all the applications are in”
The PhD program staff tells us that although it is too early to know whether the number of applications this year will show an increase, inquiries to the program are up this year. With a January 2, 2002 admissions deadline, they have already distributed their entire stock of 3,500 application packets. Elissa Hirsh, program administrator, explained, “because the PhD program is research-oriented with most graduate-placement being faculty positions in schools of business or related departments such as economics, the economic downturn may not be as immediate an indicator of the number of PhD applicants.”
A large number of the Sloan and PhD program participants are international, which makes them vulnerable to potential visa restrictions, another wild card in this year’s application process. Some members of local, state and national governments in the US have been threatening to restrict the number of incoming international students and more closely monitoring those that are here. This would be a loss for business schools in general and the multinational GSB in particular.
As for the MBA applicants, despite these uncertainties, those who are fortunate to gain acceptance to the top schools will still graduate into an unpredictable job market with debt that can approach $100,000. This year’s class is dealing with the most disappointing recruiting market in a decade and it will likely be years before we see a return of the recent thriving job market.
But, as one member of the GSB MBA class of 2002 put it, “the tool kit, friendships and contacts we make at a place like Stanford are priceless and will outlast any recession.”