Interest in MBAs rising once again

Sam Betters, executive director of the Loveland Housing Authority, said earning a master of business administration degree gave him new skills in areas such as finance and marketing.

Betters earned his MBA from the University of Colorado executive MBA program in 1995. The housing authority board of directors paid his tuition and Betters continued working while he went back to school to earn it.

The “two years of hell” were well worth it, Betters said, noting that he learned a lot, expanded his network and developed skills valuable to his organization as it moves into new areas of housing and development.

Betters earned his MBA at a time when the degree, described by some as the ultimate business credential, was high on the must-have list for recruiters and job-hunters alike.

With the onslaught of the economic decline that ushered in the new century, many with MBAs saw waning interest in the credential. As 2001 rolled around, some MBAs even experienced the unthinkable: layoffs.

Education and career experts say that the popularity of MBA degrees tends to be related to the economy and, like most things related to the economy, swings in cycles. When times are good, MBAs are sought-after hires. When times are slow, interest in the degree slows and employers turn their focus to people with undergraduate degrees, who tend to be less-expensive hires.

Right now, interest in obtaining MBA degrees and in recruiting graduates of MBA programs is, in general, rising.

Most recent surveys of business-school enrollments indicate growing numbers of full- and part-time applicants to MBA programs nationwide, said Art Kraft, dean of the business school at Chapman University in Orange, Calif., and chairman of the board of directors for the Association to Advance Collegiate Schools of Business.

AACSB International is an accrediting organization for business schools offering degrees in business administration and accounting. Based in Tampa, Fla., it also serves as a professional development association.

The cycle of popularity says nothing about the value or validity of the degree. “Once you have it, it will be valuable, regardless of what the newspaper or BusinessWeek or anyone else says,´ said Mary Banks, director of a career center for MBA and undergraduate business students at CU in Boulder. “It is a form of intellectual enhancement.”

“There are cycles and seasons,” noted Debra Benton, an internationally known executive coach and business author based in Fort Collins. At the same time, Benton said, in some businesses an MBA is a must-have.

“In some environments, having an MBA is a box you have to check. You might be the most brilliant. You might have the most executive charisma. You might be the daughter of the owner. However, there are some times in some companies when you just have to have a box checked and it’s the MBA box.”

That’s more likely to be true in larger companies “and certainly in any kind of consulting organization,” Benton said.

MBA degrees are heavily sought-after by both individuals without undergraduate degrees in business and business bachelor’s holders whose promotional paths have been vertical within a discipline, said Susan Meyer, director of distance MBA programs for Colorado State University.

“The MBA is that bridge into or across the functional areas of business,” she explained.

Flexibility increases access

Increased program flexibility is helping fuel growing applicant numbers, Kraft said. MBA programs are increasingly offered not just full-time but evenings, weekends and online. “Business schools, in the early 2000s, became more creative and innovative,” Kraft said.

Educators were responding to the conditions in the marketplace, which saw a risky job market where potential MBA candidates were reluctant to leave their paid positions and take on the expense of full-time student-hood.

CSU’s distance MBA program offers an example. One of the pioneers in the nation in distance MBA programming, CSU started delivering distance MBAs in the late 1960s.

CSU has about 460 enrolled worldwide in its distance program. Students may be distant, but they are well cared for through the program, which maintains a professor-to-student ratio of one to 40. The university was acknowledged by the Princeton Review, which ranked its MBA program as the second best administered program in the nation, Meyer said.

There’s a demographic element to the increased interest in MBA programs, as well, Kraft said. In early 2000, the 25-29 age group in the United States was the smallest. In 2005-06 that started to turn around, with a larger number of 25- to 29-year-olds.

A stronger economy, too, means more interest in MBA hires, Kraft said. Placement rates have headed into the 90 percent realm and salaries have started to creep up again, as well, he said.

CU’s Banks said that in 2005, placement was about 86 percent and that it appears to be up this year over last. She observes a change in the approaches of both job-hunting students and recruiters.

Students who are aggressive in planning and executing their job searches are succeeding in obtaining positions, while employers are showing more interest in seeking out and hiring MBAs.

“Do employers want the entitled elite MBAs of yesteryear? Probably not,” Banks noted. “Employers want someone who is really going to produce for them.”

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