Ever since the end of the Great Recession, the job market for MBA graduates has shown steady and robust growth. Each year, from 2011 to 2016, MBA hiring has gotten stronger and stronger, far in excess of the improvement in the overall economy.
And now it looks like 2017 will see yet another solid year of MBA hiring and increasing salary offers, according to a report of employers out today from the Graduate Management Admission Council. Nearly eight in 10 (79%) employers expect to hire MBA graduates in 2017, compared with 68% of these same companies that hired MBA candidates in 2016, the GMAC study found.
Of the employers with plans to hire recent MBAs, 58% say they expect to increase their starting annual base salaries either at or above the rate of inflation, while 40% plan to maintain salaries at 2016 levels. Some 19% made clear their intention to boost salaries above the inflation rate.
‘STILL SEE OPTIMISM AMONG EMPLOYERS IN THEIR HIRING OUTLOOK’
“We see a continuation of positive news for the future of business graduates seeking employment,” says Gregg Schoenfeld, research director at GMAC. “We still see optimism among employers in their hiring outlook, and we see some optimism in increasing salaries over last year. Almost no one is saying they are going to decrease salary so the value of management education is holding.”
The report is based on responses from 167 recruiters from more than 140 companies, including 36 members of the Fortune 500 and the big four consulting groups. The majority of respondents were based in the U.S., though they were located in 27 countries. The survey was fielded in the middle of the Presidential campaign from Oct. 26 to Nov. 18. The surveyed employers have hired business graduates in the past.
The Year-End Employer Poll shows what many business school employment reports already confirm: solid hiring results for 2016. Nearly seven in 10 employers (68%) hired MBA graduates last year, and an even greater percentage of employers hired bachelor’s degree grads (79%). In comparison, hiring rates for graduates of Master of Accounting programs, other business master’s, and nonbusiness master’s were lower than other candidate types, but still on par with trends from previous years, says the GMAC report.
POSITIVE OUTLOOK FOR ALL BUSINESS GRADS, THOUGH THE NUMBERS DIFFER
The employer study found that of the 68% of MBA hirers in 2016, nearly eight in 10 (78%) say they met or exceeded their hiring goals for these candidates. In 2017, 78% of employers who plan to hire MBA graduates expect to hire as many or more of these candidates than they did in 2016.
But the outlook was positive across several business degree candidates on both the master’s and undergraduate levels. Some 27% of employers hired Master of Accounting graduates in 2016, with two out of three (64%) reporting that they met or exceeded their hiring goals. In 2017, a slightly higher 29% of employers intend to hire Master of Accounting graduates, with 80% of these employers expecting to match or increase the number of candidates they hire from this group.
In 2016, GMAC found, 79% of employers hired bachelor’s candidates, with the majority of employers matching or exceeding their hiring targets by 87%. This year, 85% of employers plan to hire students from undergraduate business schools, with 80% of the companies expecting to hire them in the same or greater numbers than 2016.
MARKET FOR SUMMER INTERNSHIPS EXPECTED TO BE STRONG AS WELL
When it comes to actual starting pay, more than half the companies told GMAC they plan to increase annual base salaries for new hires in 2017 (see above). More than half of employers (58%) intend to increase base starting salaries for new MBA hires in 2017 either at or above the inflation rate; 40 percent will maintain salaries at their current level. The majority of employers (57%) plan to offer Master of Accounting hires in 2017 annual base salaries at or above the inflation rate, with 39% of companies keeping salaries at their current level.
If there was a sour note in 2016, it was in the percentage of companies hiring Master of Management candidates. A smaller than usual proportion of companies (19%) reported hiring MIM grads in 2016. In prior years, the percentage of employers in this market trends in the 29% to 30% range, especially for non-U.S. employers who tend to hire a greater share of these candidates. GMAC says that last year’s overall results appear to have been driven down by a low percentage of U.S. employers (16%) who hired these candidates, in contrast to nearly a third of employers in Europe and Asia (32% of these employers combined). Hiring projections for these graduates in 2017 are looking up, with 31% overall expected to offer jobs to these candidates
Nine in 10 companies in the survey provide internship programs for undergraduate and graduate-level students. Of those companies, two-thirds (66%) plan to offer internships to MBA candidates in 2017. Some 82% of companies offering MBA internships will maintain (23%) or increase (59%) the number of internships offered to these candidates in the coming year. Among employers who plan to offer internships to B-school students, 17% plan to offer them to Master of Accounting candidates in 2017; 16%t of these employers will offer internships to Master in Management candidates, and 15% to candidates enrolled in Master of Finance programs.