MBA enrolments dip as students fear of another slowdown
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Middle and lower-rung institutes are weighing relaxation of selection criteria so as to prevent a revenue deficit."While the impact has been relatively low in the top institutes, a majority of the 4,000-odd management institutes in India are facing an acute shortage of students, even a 50% drop in some cases," says IIM Calcutta director Shekhar Chaudhuri.
B-schools and organisations conducting entrance exams say the global recession is forcing engineering students - one of the largest section of MBA aspirants - to go in for jobs immediately after graduation. Working executives are also thinking twice before pursuing an MBA.This year, the number of people who actually took CAT - the entrance examination for the premier Indian Institutes of Management and more than a 100 other top institutes - was 1,85,000, compared with 1,86,229 students last year.
CAT registrations, however, went up by less than 1% this year to 2,06,500 compared with 2,05,000 students last year. Fewer students sat for the exam.All India Management Association (AIMA), which conducts the MAT entrance, confirmed a drop in the number of enrolments without quoting exact numbers. More than 1.6 lakh students enrol for MAT every year. US-based Graduate Management Admission Council (GMAC), which conducts the popular GMAT entrance examination in over a 100 countries, too said there has been a fall in number of enrolments. GMAC said while 2,58,192 students took the exam globally in 2010-11, the number of applicants was higher, at 2,63,979 in 2009-10.
Even in India, which has been one of the fastest growing markets for GMAT, there has been a fall in enrolments. The number of Indians who took GMAT fell to 25,394 in 2010-11 from 30,633 in 2008-09.Some management institutes are planning to lower their rigorous selection criteria for the next academic year to fill the seats, and are considering a relaxation in percentage cut-offs and a larger selection list.
The director of a Delhi management institute, which ranks amongst the top 40 B-schools in India, said the number of application forms it has sold till date this year is 30% less than last year. Most of our candidates typically apply to multiple institutes.
We don't know how many will ultimately come for the group discussion and interviews. We may have to go a little easy in this phase of selection," said the director, who did not wish to be named.Till the global economy looks up, this trend is likely to continue, says CAT 2011 convenor Janakiraman Moorthy, but adds the situation does not affect the IIMs since all the institutes taken together have some 3,000 seats, which is less than 1.5% of the total applications.
"But institutes ranked 20-30 are facing a problem," he says. Students are not just betting on MBA as the ultimate choice. They have become more careful after the 2008-09 recession, when several institutes, including the IIMs, faced a problem in placing their students and average placement salaries dipped.
"Engineering graduates, who are already well paid, are now finding that they are not seeing any significant increase in salary by getting an MBA, unless it's from a top school," says Xavier Institute of Management, Bhubaneswar (XIMB) director PT Joseph. Even though XAT registrations are open till December.
so far, there has hardly been any growth in applicants, he adds. XAT is conducted by Xavier Association of Management Institutes, which has more than 16 core member institutes and 85 associate B-schools. GMAC's director Bob Ludwig says students are investing in a career while going in for a part-time MBA, executive MBA, and specialised masters programmes such as in finance and accounting.
In fact, GMAC this year undertook a global survey which shows that the large majority of fulltime MBA programmes reported decreases in application compared with last year, but the majority of part-time and executive programmes reported volumes that remained the same or increased.
However, students who are clear about a career in management are not dropping out or delaying admission, says AIMA director general Rekha Sethi. "But those who considered MBA as a fashion statement are tentative, as management education is neither easy nor cheap," she says.
Publication Date: 2, Dec 2011
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