With over two decades of experience, Tarun Aggarwal has worked across India Inc including Infoedge, Tech Mahindra and HCL, where he has executed functions like sales, business development and operations. A business strategy expert, Aggarwal completed his engineering from the Thapar Institute of Engineering & Technology and has an MBA from the prestigious Indian Institute of Management (IIM) Ahmedabad. Prior to joining CollegeDekho, Aggarwal was partner and business head at RoundGlass, where he piloted a digital marketing service specifically aimed at the needs of the development sector and conceptualized an offering to help social organizations with Corporate Giving (including CSR funds) and employee engagement base.
Until a few years ago, having an MBA degree from the USA was considered to be a badge of honor. The degree not only assured a high-paying job but also offered a strong professional network and post-study work opportunities as some of its perks. Home to almost 50% of the top-notch B-schools in the world, the United States of America receives lakhs of applications every year from aspirants who wish to build themselves a better future. But, as merry as it seems, the picture has changed in the past few years.
In June 2019, The Wall Street Journal published an article that stated that some of the top elite business schools like Harvard University and Stanford University have started to see a sharp decline in the number of applications they received and are struggling to attract international students. Furthermore, in 2020, Forbes called the ‘MBA Degree in Crisis’ after noticing a decline in applications and found the degree ‘not worth it’, especially after the pandemic.
Does this mean that an MBA from the USA has lost its sheen? Let’s dig deeper.
Why the decline?
An MBA is one of the more expensive courses in any country. It is treated as an investment to a lucrative career by most aspirants, and an MBA from the USA is usually considered the safest bet. Top companies end up hiring these MBA graduates and pay a premium in salary that makes spending all those extra dollars’ worth it. But the financial turmoil that the pandemic brought forced a lot of aspirants and hiring companies to rethink their strategy. Maybe recruiting someone who pursued an MBA from a slightly lesser-known university started making a lot more sense as that person can be groomed to fit the company’s requirement and will work for a far lesser salary. This would lower down the average of the salaries offered to the top B-school graduates too which in turn made these colleges less lucrative for the aspirants.
Also, many top US based companies are still following a remote model of working. This has allowed these companies to recruit candidates irrespective of their geographical location, which in turn has led to lesser demand for candidates who are graduates of US B-schools.
More applicants in 2020 – 21
Graduate Management Admission Council (GMAC) conducted a survey that found the volume of applications for graduate business school programs abroad rose by 0.4% in 2021 from the previous year. This rise was seen due to various reasons like friendly visa policies, easing of lockdown restrictions, two-year work visas and more. The trend looks promising, provided the new COVID variant- omicron doesn’t stumble as a new hurdle.
As a matter of fact, nothing could dull the sparkle of ambitious Indians aspiring to pursue an MBA from the USA. MBA still tops the list of the most popular post graduate programs in the country. MBA specialization in consulting, finance and marketing are some popular and sought after programs among Indian students. These specializations can help a MBA graduate from the USA to score an average annual salary of $109,000!
Before the US Presidential election 2020, Graduate Management Admission Council (GMAC) conducted a survey and found that a good percentage of international students said they are more likely to study in the US if Biden comes to power. Biden’s policy document also mentioned that he will ensure that over 500,000 Indians are provided American citizenship in the next few years.
Unwelcoming and restrictive visa policies under the previous administration had resulted in a significant decrease of confidence in the US dream. This has led to a reduction in the number of international students in the US, which eventually hurt the country’s reputation as the top study destination for foreign students.
US v/s others
Regardless of providing excellent academic exposure to students through their top colleges, studying in the US is undoubtedly an expensive gamble to play. The cost of living in the US can alone go up to $10,000 to $12,000 per year while the average tuition fee may circle around $30,000 to $50,000 per year. Therefore, MBA aspirants are looking towards countries that can provide cheaper but quality academic opportunities other than the US. As per a survey by GMAC, Canada (69%), Asia-Pacific (63%), UK (49%), Europe (46%) reported sharp growth in MBA applications from international students as compared to the US (38%). Moreover, these countries received 4.1% more applications from international candidates as compared to domestic ones.
Having an MBA these days isn’t just about having an additional certificate of qualification. Be it establishing connections, getting a quality education, or receiving a higher ROI, let’s face it, no other country does it like the USA. An MBA from the USA is yet to lose its sheen completely but the lower cost for an MBA offered by other countries, along with more attractive Permanent Residency options is proving to be a stern challenge.