Geographic Trends and the MBA

Classroom demographics will undergo a noticeable shift as world economic and population trends, and GMAT volume data, seem to have permanently altered the student pipelines for B-school programs.

In the February issue of Deans Digest, Graduate Management Admission Council (GMAC) president and CEO David A. Wilson addressed the boom in demand for graduate business education, citing the record number of GMAT exams taken in the testing year ending June 30, 2009. For the first time in GMAT history, non-US citizens lead all test takers by 51%.

Wilson identified five macro forces which have influenced the channels of students interested in graduate management education:

  • Economic growth and job creation. Growing economies create jobs and career advancement opportunities. GMAC research finds that some 70% of employers expect their business will improve in 2010, which also tracks with broader global indicators, Wilson said.
  • Population changes. Africa expects a 50% increase in the student-age population (20-29) over the next two decades. The student population in Asia is expected to be stable until 2025. Europe, meanwhile, expects a nearly 25% decline in student-age population.
  • Population shifts within regions. India will gain 28 million people in the student-age group over the next two decades, China will lose 76 million. Similarly, Germany expects to lose nearly 2 million, while France expects a gain of almost a quarter-million. In the US, a rise of some 4.8 million potential students is expected by 2030.
  • Age range diversity. GMAT test-takers worldwide are largely in the 24-30 age bracket, but those examinees younger than 24 increased 132% between testing years 2005 and 2009.
  • Student mobility. GMAT scores sent to non-US destinations jumped to 170,000 in 2009, up from about 90,000 in 2005. Score-sending patterns shifted away from US programs in nine of 10 global regions. US business schools  still received 78% of all GMAT scores sent in 2009, though, due to the fact that 98% of US citizens send score reports to US schools.

How will these changing demographics play out in the classroom? Wilson says business schools will need to assess how a potentially younger cohort with less work experience might affect class discussions, team projects, and school dynamics.

For more on this issue, check out GMAC’s new World Geographic Trend Report 2005 to 2009, which takes a look at schools outside the United States that have become increasingly attractive to business students.

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