The standard advice to have five years of work experience before pursuing an MBA may not be so advantageous after all, writes marketing and ethics professor Mark Johnston in a recent BusinessWeek piece.
The average age of a first-year MBA is now 28, up from 25 just ten years ago, and dropping out of the workforce at this stage in one’s career often creates a large opportunity cost, not only in foregone salary but also in lost career momentum, particularly in fast-moving high-tech industries, Johnston says.
Souring economic times have caused more people to turn to full-time MBA programs in the past 18 months; however, enrollment in part-time programs has trended higher in recent years as this demographic doesn’t incur the high opportunity cost of foregone salary, and many have some or all of their tuition cost reimbursed by their employer.
At the same time, Johnston says, schools hope to boost the percentage of women in MBA programs; many women are reluctant to wait until age 27 or 28 before entering business school because they would like to use this time in their lives to start a family.
Johnston, who teaches at Crummer Graduate School of Business, and two colleagues have studied the economic costs and benefits associated with choosing to delay an MBA in order to gain work experience first. The research results, he says, refute the traditional implication that most students will be financially better off in the long run, particularly when the opportunity cost of forgone salary is considered.
“In fact, for many students, the opposite may be true,” Johnston says. “This result, published recently in the Journal of Education for Business, is important to MBA educators as they consider various admission criteria and to prospective MBA students, who should investigate going directly from undergraduate to graduate school.”
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