Globalization and a Diversifying Market: A New Reality for Business Schools

Findings in the recently released 2017 GMAC mba.com Prospective Students Survey Report illustrate the extent to which graduate business education has become highly globalized, with a growing number of candidates worldwide seeking international study options.

May 16, 2017

GMAC RESEARCH

Prospective Students Survey

Though the demand for MBA programs remains high, the market for graduate business education grows more diverse and competitive, with increasing candidate demand driving the proliferation of non-MBA business master’s programs. These candidate-driven disruptions challenge business school professionals to demonstrate how they can continue to deliver value to a pool of potential candidates who have distinct program preferences, study options, and career outcomes in mind.

Analysis in the 2017 report is based on responses provided by more than 11,000 mba.com registrants who completed the Graduate Management Admission Council’s annual prospective students survey in 2016. The results of this research study highlight the many social and economic factors influencing candidate’s decisions about pursuing a graduate business degree. The following are key findings from the survey.

Prospective Students GraphicInternational Study Demand Remains Strong

Among survey respondents, nearly 3 in 5 prospective business school students (59%) intend to apply to programs outside their country of residence, up from 44 percent in 2009. Globally, the share of candidates who plan to apply to local schools has decreased over the same period, from 47 percent in 2009 to 31 percent in 2016.

Globally, most internationally minded non-U.S. candidates prefer to study in the United States (58% of respondents), but preferences are shifting, depending on preferred program type. Among non-U.S. full-time MBA candidates seeking to study outside their country of citizenship, 58 percent prefer to study in the United States, down from 61 percent in 2009. Since 2009, there has been a slight shift in preference from U.S. programs to Canadian programs among these candidates. There has been a similar shift in preferred study destinations among non-U.S. candidates considering business master’s (non-MBA) programs. In 2016, 47 percent of non-U.S. prospective students interested in business master’s programs stated a preference for studying in the United States, down from 57 percent in 2009. These candidates are looking less to the United States and more toward Western Europe, Canada, and East and Southeast Asia for their study options.


Protectionist National Policies May Affect Candidates’ Intentions to Study Abroad

Most prospective graduate business students who seek international study opportunities are, by default, looking at programs outside their country of citizenship (96%), which can complicate the application process due to the added hurdles of acquiring student and/or work visas. Registrants’ survey findings show that one-third (34%) of candidates who seek to study outside their country of citizenship plan to seek employment in the country where they choose to study.

Recent proposed changes in U.S. immigration and visa policies and last year’s Brexit vote in the United Kingdom may cause many candidates to reconsider their international study options. Both events may make it more difficult for non-citizens to obtain student visas to study in these countries or to obtain work permits after graduation to seek employment there. Visit the gmac.com home page for links to the latest updates on immigration and visa policies that may affect international students.


Demand for Business Master’s Continues to Grow but MBAs Remain Most Preferred Program Type

Survey findings show that more than 3 in 4 prospective students (77%) report they are considering an MBA program compared with half (49%) of candidates who are considering business master’s (non-MBA) programs. Yet, with the growth in the number business master’s programs worldwide, the share of candidates considering only business master’s programs has increased from 15 percent in 2009 to 23 percent in 2016. Candidates considering only MBA programs decreased from 52 percent to 49 percent over the same period.

Business Master’s Degrees Are Not a Substitute for an MBA

Globally, 1 in 5 prospective graduate business school candidates (22%) currently holds a prior master’s degree earned in a business or other field. Three-quarters of these candidates (74%) are considering enrollment in an MBA program. The survey findings show that an MBA degree remains the predominant program format considered by candidates with both prior business master’s (61%) and non-business master’s degrees (86%).

“These findings demonstrate that a business master’s degree is not necessarily the end of graduates’ business education,” said Sangeet Chowfla, president and CEO of GMAC. “For many, their business master’s degree is a steppingstone to continued professional development that may include an MBA down the road.”

Distinct Candidate Pools

For school professionals concerned that business master’s may become a substitute or replacement for an MBA, GMAC’s research findings suggest otherwise. Demographic analysis of prospective students’ preferences show that the different program formats attract distinct candidate pools. Candidates considering business master’s programs tend to skew younger, have little to no work experience, and express more interest in acquiring technical skills that programs in finance or accounting, for example, provide. Candidates eying MBA programs, in contrast, typically are older, have more years of work experience, and seek managerial and leadership skills.

Educational Costs and Financing Weigh Heavily on Candidates’ Minds

Consistent with past research, the predominant reservation candidates have about pursuing a graduate business education revolves around costs. Total tuition costs and scholarship availability are the two most important financial considerations that candidates evaluate when deciding where to apply, which also may explain in part some of the shift in non-U.S. citizens preferred study destinations away from the United States in favor of other world regions.

Compared with 2009, prospective students, on average, expect to cover a greater share of the cost of their education through scholarships, grants, and fellowships. They anticipate less reliance on financial support from their parents, their employers, and loans compared with recent years.

For additional analysis about candidates’ intended career goals, preferred industries for postgrad employment, regional differences in distinguishing criteria for international study options, and more download the full 2017 report at www.gmac.com/prospectivestudents. Schools that accept the GMAT® exam for admissions have exclusive access to the mba.com Prospective Students Survey Interactive Report, a tool that allows users to filter the data by a variety of demographic variables, undergraduate major, self-reported GMAT score, program type considered, and career goals. Watch for related information and analysis of survey findings on the Research Insights webpage.