DEMAND FOR B â€“ SCHOOL GRADUATES
Business school graduates never had it so good. According to the International MBA Recruitment and Salary Report 2006, there has been a 24% increase in demand for MBAs in 2006.
The survey, conducted with responses from 445 companies in 33 countries, reveals that the job market has been propelled mainly by the uptake in the consulting sector. In terms of the demand for MBAs, this year, the consulting sector reported a massive 38% increase, followed by financial services with 24%, general industry with 18% and the tech sector with 17%.
In a sense, 2006 has been a record year for MBA graduates in terms of not just salaries and bonuses, but also the number of offers received. The job markets of the US and Europe have picked up substantially while Asia has moved forward steadily. The reasons are obvious: Greater economic confidence, especially after the downturn of 2001. With heightened activity in terms of IPOs, mergers and acquisitions, new projects entering new markets, traditional recruiters are aggressively returning to the MBA job market.
Country demographics are also at play here. Mature markets like North America are showing the first signs of the retirement of the baby boomers. As a result, companies need a ready pool of talent that can take on the roles of those retiring. With their rapidly ageing populations, Europe and China are pretty much in the same boat as North America. In younger economies like India, the picture is slightly different. Here the demand for talent is driven by a need to manage growth.
Along with the growth in demand for MBAs, globally there has been a spike in salaries too. This is attributed to the swing in relative bargaining power. To-day, employees are powerful again. Further on, talent shortage in countries like India, China and the US will force salaries to rise, whereas Europe will remain relatively flat.
There is a trend towards recruiting younger people whereas traditionally recruiters have shown a strong bias towards candidates with 1-8 years experience. This year fresh graduates with MBAs have been targeted by an increased 22% of recruiters,
reflecting perhaps a growing scarcity of quality MBAs with sufficient experience.
With Europe enforcing the Bologna Accord by 2010, the trend towards younger candidates will only grow. In other words, the Bologna Accord will force people studying in Europe to do their Masters earlier. So the MBA will have to compete with a whole set of specialist masters degrees, and it is bound to lose candidates to the latter because they stress upon lesser work experience requirements.