Projected Demand for MBAs Reaches New High: GMAC0
As per a Graduate Management Admission Council (GMAC) survey, employers plan on hiring more business school graduates in 2015 than in previous years and salaries of MBAs and Business Master’s Graduates is also expected to rise globally.
Employer demand for recent business school graduates continues to show a strong upward trend in 2015, as 84 percent of companies worldwide plan to add new MBAs to their workforce – up from 74 percent in 2014 and 62 percent five years ago, according to a global survey of employers published today.
The 2015 Corporate Recruiters Survey, conducted by the Graduate Management Admission Council in partnership with EFMD and the MBA Career Services & Employer Alliance (MBA CSEA), drew responses from 748 employers in 47 countries around the world, including 46 companies listed in the Fortune 100. Conducted by GMAC annually since 2001, the survey provides a view into the current employment landscape, gauges the demand for MBA and master-level business graduates, and offers insight into hiring practices and trends across industries and world regions.
“The MBA, as an area of study valued by employers, is showing more strength than ever with hiring of new graduates projected to rise for the third year in a row,” said Sangeet Chowfla, GMAC president and CEO. “Employer demand for recent business school graduates, notably those skilled in data analytics, continues to increase as companies expect these new workers to use data to drive business decisions starting the moment they’re hired. Students of any undergraduate background would do well to consider taking a graduate management degree because of the contributions it can make to their career aspirations.”
Prior work experience is key in helping students stand out in the job market, especially for MBA graduates. Depending upon the degree earned (MBA or MBM/ MiM), employers expect recent graduate business candidates to have an average (median) of two to four years of prior work experience
Regional highlights from the survey show:
- More than 9 in 10 (92 percent) companies in the United States plan to hire MBA graduates in 2015 – up from 80 percent that hired MBAs in 2014. The proportion of U.S. companies with plans to hire specialized business master’s candidates in 2015 is 12 to 16 percentage points higher than the share of companies that hired them in 2014.
- Seventy-five percent of Asia-Pacific companies (69 percent in 2014) plan to hire recent MBA graduates.
- More than half of European-based companies plan to hire MBAs (56 percent of employers, up from 53 percent in 2014) and Master in Management graduates (52 percent, up from 51 percent).
- A larger share of Latin American companies plan to hire MBA and Master of Finance graduates this year compared to the share that hired them last year. Seventy five percent plan to hire MBAs (up from 69 percent that hired MBAs last year) and 61 percent plan to Master of Finance graduates (up from just 32 percent that hired them last year).
“When companies express a focus on growth, it appears they return to MBA hiring,” Chowfla said. “Whereas in the past, when priorities such as managing the enterprise or cost control were foremost on a company’s agenda, employers appeared to favor hiring more specialized graduates. This is an aspect of the hiring market we’ve observed through our research and one which will require more study to provide the deeper insights that can help both students and schools navigate the hiring market.”
Globally, more than half of employers will increase starting salaries for new MBA hires in 2015, either at the rate of inflation (30 percent of companies) or higher (21 percent). The median starting salary expected in 2015 for recent MBA graduates in the United States is US$100,000. This represents an increase of US$5,000 over 2014 salaries and is nearly double the expected starting salary of US$55,000 for bachelor’s candidates in 2015.
Prior work experience is key in helping students stand out in the job market, especially for MBA graduates. Depending upon the degree earned, employers expect recent graduate business candidates to have an average (median) of two to four years of prior work experience.
GMAC’s research into hiring trends also shows notable growth in the demand for data analytics, with 51 percent of all companies surveyed globally stating that they plan to hire for this job function in 2015 — up from 44 percent last year. When asked to list three skills employers look for in business school graduates this year, analytics was the most frequently mentioned skill.
In addition to these findings, the 2015 report also explores job level placement and recruiter behavior:
- Globally, the majority of recent business school degree holders, upon graduation, can expect to be placed in a mid-level or entry-level position depending on whether they pursued a Masters in Business Administration (MBA) or Masters in Business Managemt (MBM/ MIM) degree. Employers in Latin America and Europe expect to place the greatest proportion of recent business graduate hires in senior- and executive-level positions.
- Employer attitudes towards massive open online courses, or MOOCs, vary regionally. Among employers familiar with MOOCS, those in the U.S. are least likely to consider MOOCs an alternative to graduate management education (8 percent). Rather, they are more likely to view them as a professional development tool (64 percent) or as a means to help employees explore personal interests (57 percent). Companies in Asia-Pacific are the most likely to consider MOOCs an alternative to graduate management education (29 percent).
- When choosing graduate business candidates to interview – 9 in 10 employers cite a demonstrated track record, strong communication skills, and solid technical or quantitative skills as their top three selection criteria.