As people look for inventive ways to ride out the coronavirus-induced economic downturn, some are angling to go back to business school. We asked four experts to explain when it makes sense to invest the time and money required to earn a traditional, two-year masters of business administration.
Admissions coaches, former deans and M.B.A. program coordinators generally agree that the sweet spot for potential degree seekers is during their mid- to late-20s—perhaps early 30s—when people are more likely to have the financial and personal flexibility to go back to school. Good candidates also tend to want a career change. The degree has its detractors; Tesla CEO Elon Musk recently suggested too many M.B.A.s. are hurting companies’ ability to think creatively.
“The reason you would get an M.B.A. is if you were successful but you don’t think your career is moving at the rate you want it to or you think you’re in the wrong part of an industry,” says Blair Sheppard, former dean of Duke University’s Fuqua School of Business and current global head of strategy and leadership for PwC, the accounting and consulting firm.
“The other way to think about an M.B.A. is, it’s a fresh start on everything,” he says. “It’s a good life reset.”
The Price of Admission
Some top jobs encourage an M.B.A. as a prerequisite, says Judith Hodara, co-founder and director of M.B.A. admissions consulting firm Fortuna Admissions and former head of M.B.A. admissions at the University of Pennsylvania’s Wharton School.
Many Wall Street firms highly encourage the degree as a ticket to advance in investment banking or private equity, though it’s not always necessary, Ms. Hodara says. Associates and analysts at banks and other financial firms who have two to three years of experience are the central feeders to a lot of the top business schools.
M.B.A. candidates also appear to get favored status in certain parts of the tech world these days, such as for product manager positions, says Ms. Hodara.
Young and Free
Ann Harrison, dean of the University of California Berkeley’s Haas School of Business, says the typical M.B.A. applicant has three to five years of work experience, giving them an opportunity to explore where they want to go in their life.
While some highly ranked programs, such as Harvard Business School, do offer support for families, such as housing resources, networking opportunities and a variety of clubs for students with families, the two-year, full-time M.B.A. format is ideal for singles and those with more flexibility in their life, Ms. Hodara says.
“Are you willing to do long-distance with a partner? If you have a family, will they come with you?” she says she asks prospective students to consider.
Financially, several admissions experts say it can be better to get an M.B.A. in your late 20s because you have more years of higher earning potential ahead of you. That’s because the cost of some traditional programs can range between $100,000 and $200,000, or more, once living expenses are factored in on top of tuition and fees.
Some M.B.A. candidates choose to take out loans so they can put their career on hiatus for two years while they attend school, but it can be harder to justify taking on a six-figure debt load in your late 30s or 40s, particularly once you have a mortgage or your own children’s college expenses to plan for, says Kofi Kankam, chief executive of Admit.me, which coaches M.B.A. prospects on how to apply.
A Plan to Pivot
Aside from age and stage-of-life considerations, the traditional M.B.A. experience is ideal for people who don’t have the necessary skills to advance in their current career or are looking to make a career switch that will lead to a big salary increase, Mr. Kankam says.
“If you are in publishing and want to go into finance, or you are in teaching looking at consulting, those are big shifts. And if that’s the case, then certainly you should be looking at going,” he says of the M.B.A.’s ability to help catapult people into new positions and industries.
The degree doesn’t make sense for people who have lost a job because of performance issues or lack former bosses who can write letters of recommendation that are needed to apply, Mr. Kankam adds.
The degree also doesn’t make financial sense for people who plan to work in sectors where getting an M.B.A. won’t result in the kind of substantial salary increase that justifies taking on student debt.
“If you work for something like a nonprofit and you’re making $30,000 to $45,000 a year and still have undergraduate debt, it doesn’t make sense to go to B-school,” Mr. Kankam says. “It’s going to be a huge amount of debt and your job prospects won’t allow you to manage that debt.”
Consider All Options
There are a multitude of alternatives to the traditional, two-year M.B.A., including part-time, one-year, executive and online M.B.A. programs, as well as shorter degrees tailored to high-demand skill sets, such as data analytics, experts say.
Shorter M.B.A. and other business degree programs have proliferated recently as a way to attract professionals turned off by the idea of pausing their careers for full-time studies or taking on additional student debt.
“If you’re in a business you like and your career is going fine and if you want an M.B.A., just do a part-time,” says Mr. Sheppard of PwC, adding that people in their 40s and 50s may also consider an executive M.B.A. program while working in order to climb in the ranks of middle management.
Courtesy: Livemint