When the pandemic brought an economic downturn, it also brought a leap in MBA applications, a newly published report from the Graduate Management Admission Council shows.
According to GMAC’s 2020 application trends report, 67 percent of graduate business programs surveyed reported receiving more applications in 2020 than in 2019. That figure represents a sharp rise from the 41 percent of programs that saw an increase in applicants in 2019.
Among MBA programs in the US, the change that 2020 brought was even more dramatic. While only a third of such programs received more applications in 2019 than in 2018, a full 70 percent saw their number of applications increase this year.
As the Wall Street Journal points out, the rush toward MBA programs was most pronounced among highly ranked schools. For example, the University of Pennsylvania’s Wharton School received 21 percent more applications for its full-time MBA program this year than last.
One pattern that emerges from the data is that when the economy falters, people flock to MBA programs since the opportunity cost of enrolling in school is lower.
Sangeet Chowfla, GMAC’s CEO, emphasized that point to Poets & Quants, pointing out that despite the uncertainty brought by the pandemic, “one constant is the countercyclical nature of demand for an advanced business degree.”
What’s different this year from a typical economic downturn is that while the number of MBA applicants is up, so is the number of admitted students choosing to defer.
Overall, the median deferral rate among graduate business programs was 6 percent this year, compared to 2 percent in 2019.
Among MBA programs in the US, the deferral rate doubled from 3 to 6 percent while in Europe it shot up to 11 percent. International students were especially likely to defer enrollment, with their a deferral rate triple that of domestic students.
If anything, the mass of deferrals among admitted MBA students could make upcoming admissions cycles even tighter.
At Harvard Business School, which gave all 2020 MBA admits the option to defer, only 720 students enrolled this year, a drop of 200 from typical years. HBS has responded by increasing its class size to 1,000 over the next two years in an effort to make room for both deferred students and new applicants.
In releasing their report, GMAC noted that the 2020 MBA admissions season was “unlike any other.” While some uncertainty still hangs over upcoming admissions cycles, it now seems clear that we are seeing a shift toward increasingly competitive admissions at top MBA programs.
Given that environment, what applicants can do is focus on the aspects of their applications they have control over: applying to the right schools and communicating a personal brand that stands out.
We’re happy to help you figure out how to accomplish those goals. If that sounds helpful, feel free to contact us for a free MBA application assessment!