In the past if you wanted to work with a major Wall Street firm or obtain an executive level position with a tech firm or other prestigious company, you needed to obtain your Master of Business Administration, commonly referred to as an MBA. That trend may be changing as businesses move away from requiring the higher level business degree.
The Wall Street Journal’s Ryan Dezember and Lindsay Gellman report that many companies, such as Chicago-based GTCR, are backing off on the tradition of requiring employees to attend business school after several years of work.
Other firms to move away from the MBA requirement include Apollo Global Management, Silver Lake, KKR, and Blackstone Group, all of which have lessened requirements on employees to earn MBAs.
Several months ago Blackstone chief executive Steve Schwarzman said that niceness is often a more important trait than holding an MBA degree.
The team at Business Insider put together a list if reasons why an MBA is losing its importance:
- The number of people enrolled to write the GMAT — an exam required for business school applications — was steadily dropping for several consecutive years. And while, in 2014, applications for full-time, two-year MBA programs were up slightly, the majority of applicants came from overseas, according to the Graduate Management Admission Council.
- Tuition is expensive — like more than $60,000 a year at Harvard, not counting fees or living expenses — and it’s continually on the rise.
- Some experts suggest it’s wiser to go for a Chartered Financial Analyst or CFA, credential instead. (All three levels of the CFA exam are being held around the world on Saturday, and more people are registered to take the test than ever before.)
- Curt Welling, a senior fellow at the Tuck School of Business, one of the best business schools in the country, thinks that online courses and a growing demand for international business schools could seriously damage established MBA programs. He says the MBA industry is “in a bit of a crisis,” and business schools need to think about how to remain relevant.
While not all fields are requiring an MBA these days, that doesn’t mean obtaining the higher level degree won’t prepare you for an executive level job path.