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Schools boom amid the gloom

  • Story Highlights
  • Survey shows increase in business school applications this year
  • This is happening despite global economic worries
  • Study also says more women are applying
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By Peter Walker for CNN
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LONDON, England (CNN) -- The subprime lending crisis might have delivered a sizeable kick in the ribs to the worldwide economy, but amid the gloom one sector is still booming -- business school applications.

art.applications.jpg

Going down... Even while economies are misfiring, business schools remains popular.

According to a global survey by the Graduate Management Admission Council (GMAC), applications rose again this year for full and part time MBAs, and for Executive MBAs, even after a notably strong 2006.

Almost two third of schools -- 64 percent -- said the number of applications per available place for full time MBA programs rose in 2007 against last year, with an equivalent rise of 69 percent for part time MBAs.

For Executive MBAs -- typically taken by older, more experienced students than standard MBAs -- 63% of programs said demand for places had increased.

Additionally, 58 percent of full-time programs said their applicants in 2007 were better qualified than those in 2006.

"This is a very exciting time for people to be investing in themselves and preparing to move onward and upward to the next stage of their careers," said Dave Wilson, president and chief executive of GMAC, a U.S.-based non-profit organization which accredits leading business schools.

"It all comes down to one simple fact: Business schools are delivering great economic value to their students, and value creation is creating demand for MBA graduates."

One factor needs to be taken into account -- the survey was conducted in June and early July, shortly before global stock markets plunged in response to concerns over the U.S. lending market, notably loans to so-called subprime customers, seen as high risk.

However, there is little reason to think many budding MBA students would have put off their studies had the survey been taken even a month or so later.

Firstly, many economists had been warning for some time of a possible slowdown in global economic growth, albeit one introduced in a less spectacular fashion. Also, however, historic MBA application data shows that when economies are in turmoil, many people decide it's a good time to step aside temporarily and pick up an MBA or EMBA.

Thus, many schools saw applications fall during the late 1990s Internet boom when would be entrepreneurs preferred to launch straight into web start-ups. When the bubble burst, many signed up for MBAs instead.

Fact Box

FT MBA Rankings
1. Wharton, U.S.
2. Columbia, U.S.
3. Harvard, U.S.
4. Stanford GSB, U.S.
5. London Business School, UK
6. Chicago GSB, U.S.
7. Insead, France/Singapore
8. Stern, NYU, U.S.
9. Tuck, Dartmouth, U.S.
10. Yale, U.S.
Source: Financial Times 2007

This year's GMAC survey additionally showed increased numbers of applications from women and ethnic minorities, with half or more of schools reporting more interest from these sectors.

Another key finding is that programs that make a special effort to recruit women -- often underrepresented in business schools -- have been particularly successful. Full-time MBA programs that actively recruit women received an average of three times as many female applicants as those which did not.

"At the encouragement of MBA employers and because they too want a more diverse representation of students, school have been encouraging more women to apply to business school," said Nicole M. Chestang of GMAC.

"It is very encouraging that efforts to target women are having an impact. My hope is that these results will motivate even more schools to develop special outreach programs." E-mail to a friend E-mail to a friend

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