The “Great Resignation” sounds ominous, and for some individuals and industries, it certainly is. As the global pandemic approaches its second anniversary, hundreds of thousands are leaving their jobs to pivot, drop out, or otherwise recast their careers in a massive shift that is further confusing — but also, in ways not yet entirely understood, invigorating — already disrupted world economies.
What’s going on? At the beginning of 2021, more than 40% of all employees were thinking of leaving their jobs, according to research published in January of this year by MIT Sloan. Experts at the Sloan School and New York University’s Stern School of Business blame toxic work culture; Erica Peng, professor at UC-Berkeley Haas School of Business, says in a recent interview in Digital Journal that there’s more to it. “What’s missing,” Peng says, “is the neuroscience underlying this mass exodus of workers. People all over the world are in a heightened state of ‘fight-or-flight’ behavior from an ongoing crisis.”
Whether they have been pushed out of the workforce by stagnant wages, spurred to switch careers by burnout, or made a reassessment of what matters in life sparked by a desire to do good or effect positive change, huge gaps are appearing in the workforce — and that means there are more opportunities now, amid a rapidly rising economy, for young, ambitious, and upwardly mobile professionals. For these reasons and more, business schools anticipated — and preliminary reports have indicated — a downturn in MBA applications in the 2021-2022 cycle after two years of boom.
MBA VS. EMBA: VERY DIFFERENT NETWORKS & RECRUITMENT OPPORTUNITIES
Stacy Blackman, founder and managing director of Stacy Blackman Consulting
Are candidates for graduate business education looking at the landscape and deciding to eschew traditional full-time MBA programs now in favor of executive or online degrees later in their career, perhaps when the economy cools off? For someone who is 26, 27, 28 years old, it’s not an easy choice: Most MBA programs have traditionally looked askance at applicants once they hit 30. The window is short and closes rapidly.
Poets&Quants asked some of the top MBA admission consultants what they’re seeing; here are their insights.
“The value and timing for the MBA has been hotly debated for decades, especially during periods when the job market is strong,” notes Stacy Blackman, founder and managing director of Stacy Blackman Consulting. “We speak with several hundred applicants a month through a three-person, centralized intake team. We’re easily able to identify trends and actively look for changes in preferences among our inquiry pool. The business school applicants who come our way know that a top full-time MBA degree, such as Wharton, Harvard, Stanford, and the others, would markedly change their career opportunities during a pivotal time professionally. They would not delay their plan, as they are 100% set on securing an elite, full-time MBA admit.
“High-caliber MBA applicants know that the student peer group, networks, and recruiting opportunities are very different for a full-time program relative to the EMBA. More than that, full-time MBA demand is strong because the two most coveted MBA programs in the world — Harvard and Stanford — don’t have the EMBA option.”
HARD AGE LIMITS OUT THE DOOR?
Blackman says full-time MBA programs are still the preferred degree for employers, giving the “best and brightest” access to top salaries and great networks. “Career recruiting among the dominant industries, including tech, consulting, and finance, happen from the full-time programs,” she says. “A former recruiter from McKinsey and Bain recently shared with our SBC team that those firms target full-time business programs in recruiting for their top positions. A tech industry specialist and HBS MBA grad, Tori, who works on our SBC team, echoed the preference for full-time MBA programs. She shared that the summer internship, which is only possible via the full-time MBA program, is the main gateway to recruiting positions: ‘The internship program provides both a lot of hand-holding into the basics of working in tech and offers a two-three month proving ground for students before they are considered (usually automatically) for a full-time MBA-track starting role. They also provide interns with the valuable community of the other program participants and perks ranging from talks, lunches, mentor sessions, and (in the trend of most tech companies) branded swag.'”
Full-time MBA grads offer tech companies, in particular, strategic thinking and a set of transferable skills for a plethora of product roles, Blackman continues. “With tech recruiting on the rise at MBA programs and in the recruiting universe generally, this is yet another incentive for young professionals to favor the full-time program route,” she says.
She adds that the hard cap of 30 years old that has traditionally divided MBA from EMBA candidates is much fuzzier now.
“Full-time MBA program admissions is adapting according to employer recruiting preferences, as we see top MBA admissions accepting a more diverse range of candidates including those who are younger (e.g., two years tenured) or much more tenured (e.g., seven-plus years) than we would have seen in the past,” Blackman says, “so we don’t see hard age limits to full-time MBA admissions that would otherwise propel candidates toward the EMBA route.”
MBA APPLICANTS IN ‘NOW OR NEVER’ MODE?
Blackman points to Sara Cherlin Diniz, a mid-career professional who holds an MBA from Harvard Business School. “There’s no doubt,” Diniz says, “that my Harvard MBA enabled me to seamlessly pivot careers … TWICE. The brand name credentialing, the life-long career support resources, and the extensive alumni network were instrumental in enabling me to migrate from strategy consultant to brand manager to the talent/HR space … all while not regressing in my career trajectory. It’s impossible to calculate an ROI of the degree, but I am certain that the course of my professional advancement would have been different without these priceless benefits.”
The MBA’s worth depends entirely on your professional profile and career aspirations, Blackman says, and what you do once you are at the program. “Fit with and performance at the program are essential,” she says. “Where there may be more equity between full-time and EMBA program options is for those who plan to stay indefinitely in their employer/industry, are 15+ tenured professionally, and/or don’t need a top 20 MBA brand for their aspirations, short or long-term.”
Blackman is not convinced there will be a downturn in MBA applications this cycle. She wouldn’t be surprised to see the opposite.
“We actually don’t see applicants to full-time or EMBA programs who are participating in the Great Resignation via unemployment — that phenomenon likely applies to a different set of career professionals. As it applies to top MBA aspirants, the Great Resignation probably has increased MBA demand because applicants are in ‘now or never’ and ‘shoot your shot’ mode. The pandemic has given the next generation a stronger sense of purpose and desire for impact. Many MBA students have mesmerizing visions for their future. As such, MBA hard costs are truly trivial relative to their grand professional goals.”
See the next page for insights into the impact of “The Great Resignation” from Linda Abraham, Caroline Diarte Edwards, Paul Bodine, and Candy Lee LaBalle.
Caroline Diarte Edwards is co-founder and director of Fortuna Admissions. She says when the job market is strong — as it is right now — there is usually a downturn in application volume for full time programs, and an increase in application volume for EMBA-type programs. “That’s because there is less incentive right now to quit the workforce, as potential MBA/EMBA candidates are getting promotions, job offers, salary increases, etc. When the job market is weaker,” Edwards adds, “there is less of a disincentive to take time out of the workforce. So yes, more people are thinking carefully about timing right now — probably more in the U.S. than in some international markets where the job market hasn’t bounced back quite as strongly.
Caroline Diarte Edwards, Fortuna Admissions
“Of course this can be quite ironic because when the job market is strong, job offers literally rain down on MBA graduates!” Edwards says.
She adds that no one can predict what the job market will look like in two or three years, and that’s the key: If you are looking at a full-time, two-year program, that’s when you would be coming out onto the job market.
“I personally think that candidates spend too much time trying to second-guess when is the best time to apply in terms of market conditions — ‘When is application volume down a bit so it’s going to be less competitive in the applicant pool?'” Edwards says. “‘When will be a good time to be graduating so I’ll land my dream job?’ They should spend more time figuring out when is the right time for THEM to go to business school.”
MBA VERSUS EMBA: THE FACTS
Edwards says there are lots of considerations when considering MBA versus EMBA — among them, cost, duration, and network.
“EMBAs are often more expensive, but the fact that you can work during the program may well offset this,” she says. “Juggling work with study isn’t always easy; however the upside is that EMBA students talk about how they are able to use what the learn in the classroom straight away and apply their learning almost in real time — which means that they often absorb their learning in a more meaningful way than might be the case for someone studying full-time in what can sometimes be a more ‘abstract’ context.”
Perhaps the biggest difference between the two is the network you plug into, Edwards says. “Full-time programs are typically more social than part-time/modular EMBA formats, and so you may forge stronger friendships,” she says, adding that MBA classes are usually bigger, “so you may come away with a bigger network of classmate friends. However, the upside of the EMBA experience is that your peer group will be more advanced in their careers, already at a more senior level, and this can mean a relative small but very powerful network.”
Most full-time MBA students are looking to make some sort of career switch, “while it is more common for EMBA students to be focusing more on career acceleration — which is often why their employer is supportive,” Edwards says, “although definitely more EMBA students are looking to change careers these days than was the case 15 or 20 years ago, when employer sponsorship was more common, and business schools have ramped up career support in response to this.” In the past, there was relatively little support for EMBA students looking to switch careers — very different from the set up for MBA students.”
Finally, there’s a big one: tests.
“Testing requirements are typically more flexible, and scoring thresholds are lower, on EMBA programs,” Edwards says, “so if you are not a great test taker, this might be a consideration.”
DON’T LET YOURSELF EXPIRE
Her advice: Candidates should try to figure out which experience and program best suits them and their needs. But be aware: From the point of view adcoms, candidates also have “Best By” dates.
“Generally, it is better to start applying earlier rather than later, because it’s not uncommon for candidates to go through more than one application cycle before they get into a program that they are really excited about, so it’s better to err on the side of starting early,” Edwards says.
“Otherwise you could find yourself as a reapplicant at a point when you are ‘past your best’ from the viewpoint of the adcom at your dream program.”
‘A FANTASTIC TIME TO APPLY’
Linda Abraham, founder of Accepted
Linda Abraham is founder of Los Angeles-based Accepted. She says the Great Resignation is a reflection of the economic boom that has followed the Covid recession and unemployment spike, part and parcel of the U.S. economy returning to its pre-pandemic levels.
“Right before that recession and spike, the economy was also booming, unemployment sank to record lows, and application volume slumped,” she notes. “I think that the Great Resignation means people are seeking employment opportunities and finding them. And just like in any boom or economic expansion, potential MBA applicants figure, ‘Why should I spend the money on business school when there are all these opportunities where I can make money as opposed to spending it? Maybe I can advance equally well professionally without the out-of-pocket and opportunity cost of an MBA?’
“The Great Resignation is one of those times. We are seeing and hearing this. Is it overblown? Probably.”
She says it’s also short-sighted.
“The irony is that an economic expansion and the related drop in applications present a fantastic time to apply because it’s easier to get into a top-ranked program and add a glittering brand to one’s resume,” Abraham says. “And that brand and acquired network is for life, not just for this uptick or that downturn. Furthermore, in times of economic boom and application bust, schools tend to compete for the students they really want, and they compete with scholarships.”
Paul Bodine, founder and CEO of Admitify, says he hasn’t seen more clients inquiring about a choice between MBA and EMBA programs. “But I don’t doubt that fewer potential applicants are willing to apply now when the economy and salaries are booming,” he adds. “I would certainly not tell someone who is enjoying accelerated professional opportunities in their chosen career to drop it for a traditional two-year, full-time MBA. But for most of the applicants who come to Admitify, the hot economy is not reason enough to delay a needed career change or risk being ‘too old’ for a traditional MBA.”
Paul Bodine, founder of Admitify
With certain clients, Bodine says, he and his team definitely do explore the MBA versus EMBA question, “usually those who are not fully competitive at top full-time programs because of test scores and/or GPA or because they are older than 30 or so. For them, I mention the EMBA as a smoother path to a branded MBA in terms of selectivity: top EMBA programs are much easier to get into.
“I have worked with countless applicants who had weak undergrad records but leveraged their professional/managerial success to get into top EMBA programs; in fact, this is almost the default profile. The Executive Assessment is also much less daunting than the GMAT or GRE and most EMBA applicants take advantage of it.”
DOWNSIDES OF THE EMBA
Bodine also shares with his clients the downsides of pursuing an EMBA — in particular the higher cost vis-à-vis the two-year MBA. But there’s more.
“A tougher work-life balance equation, eight years’ required work experience, non-immersive experience with access to fewer resources and even fewer extracurriculars, and most importantly, no summer internship to facilitate a career change,” he says, adding that the longer duration of the EMBA is not usually a big factor in clients’ evaluation of the EMBA. “These downsides are deal-breakers for the vast majority of my applicants who are considering a full-time MBA now or an EMBA later. But for some, the EMBA is really the only viable option to gain a branded MBA and access to an elite network.”
Then there’s the bottom line: ROI. Bodine points to exit survey data from the Executive MBA Council showing that its exit-survey students enjoyed a 14.7% pre- to post-EMBA salary increase ($166,549 to $190,989). “EMBAs from the top EMBA programs probably do even better,” he says. EMBA programs, moreover, “have lower opportunity costs, can be even more reasonable if your employer is contributing, and do plug you into the school’s network and brand.” But there’s a downside: “EMBA programs give you fewer working years in which to earn out the ROI, and the ROI of the traditional two-year, full-time MBA seems to be much stronger, including doubling of pre-MBA pay at graduation, a shorter debt repayment window, and more.
“While the vast majority of my EMBA admits are happy they earned their EMBAs, among my clients who are in a position to choose between a traditional two-year, full-time MBA versus the EMBA, the vast majority choose the former,” Bodine says.
CONSULTING WITH CLIENTS AT A CROSSROADS
Candy Lee LaBalle, founder of LaBalle Admissions
Candy Lee LaBalle is founder of Madrid, Spain-based LaBalle Admissions. She works with a small group of around 30 applicants each year. Of those admitted in Round 1 this year, she says, two have decided to not attend, turning down admits to Columbia Business School and INSEAD. Why?
“Both because of very good job offers that would be what they might hope for post-MBA,” LaBalle says. “Not sure if that is a ‘Great Resignation’ issue or not.”
LaBalle says she often has conversations with clients “at a crossroads,” and her approach is always “person first, applicant second.”
“I ask them what is best for them, for their families, for their current situation,” she says of her clients, 90% of whom are international. “Are they ready now to apply for full-time? Have they reached a point in their career where they are stuck or facing a slow slog to upper levels? Is the FT they are seeking going to help them get what they really want — which is usually a better job, but also a transformational experience, usually abroad, and a life-lasting network and brand?
“If everything points to yes, now is the time. Then the key for me is getting them in the absolute best program possible.”
And if now isn’t the time?
“If, on the other hand, they are in a really exciting job with loads of growth, then maybe only leave that if you are heading for a really top program,” LaBalle says, pointing to a client who is working in a unicorn, tasked with rolling out country-wide programs.
EMBA: ‘THE ULTIMATE BALANCING ACT’
LaBalle says the MBA versus EMBA question leaves out other options available in graduate business education that offer many of the same benefits.
“First we have to add in the mid-level immersion programs, the Stanford MSx, MIT Sloan Fellows, LBS Fellows,” she says. “These one-year, immersive MBAs aimed at older applicants can be the perfect compromise. You still get the immersive, on-campus experience, but a little later in the game.”
The biggest difference with an EMBA program is “you miss out on the immersive campus experience,” she says. “Yes, there are usually weeks or weekends on campus, but it is not the same. Also, most EMBAs require you to be fully working during the program. So imagine doing a top EMBA, which is very demanding intellectually and time-wise, balancing that with full-time work, AND family, as most people of EMBA age are married and have young kids. It is the ultimate balancing act. I think only working moms have it tougher — said as a working mom!”
LaBalle, like her colleagues at other admissions consultancies, adds that money must be a major consideration. EMBAs are, by and large, more expensive.
“Plus if you are doing a global program like Trium, Booth EMBA, INSEAD’s GEMBA, etc., you need to add in a LOT of travel,” she says. “If your company is paying, fantastic, lucky you! But if not, it is a financial beast and you need to be very, very sure it will pay off in the end. So for that reason, when I have self-funded EMBA applicants, I advise them to take a good look at what they will get in terms of career support.”
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