TCU Daily Skiff Tueday, April 13, 2004
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Competitive job market
awaits MBA graduates

Professionals say MBAs are still important in the business world, but experience has become almost as important.

By Drew Irwin
Staff Reporter

The lingering economic recession has affected all parts of the economy and the job market has taken an especially hard hit.

And experts say those with graduate degrees have not been spared.

For years, business students have believed that an MBA would ensure them of an easy job hunt and a prosperous salary. But today, the reality is that more is required of a student than a degree.

Bob Greer, associate dean for graduate programs and research at the Neeley School of Business, says he is not worried because he believes the job market will improve when the economy improves.

In the meantime, he thinks the Neeley School has done a good job of adapting to the changing conditions. He said 85 percent of TCU MBA graduates received job offers within 90 days of graduation.

It is difficult to isolate MBA degrees in the figures dealing with unemployment.
But in December 2000, the Bureau of Labor Statistics reported that the unemployment rate for people with bachelors, masters, professional and doctorate degrees was at 1.5 percent, the lowest of the decade.

Since then, the rate has risen slowly, and has been hovering around 3 percent since the third quarter of 2001.

While this number is low compared to the national unemployment rate, it still means there were 1.169 million people with college degrees unemployed in February 2004.
Bud Weinstein, director of the institute of applied economics at the University of North Texas, said these numbers are small compared to the national unemployment rate of 5.6 percent.

“Those numbers would only be alarming to me if I was a college graduate without a job,” Weinstein said.

Part of the issue is that in a market with more applicants than jobs, employers can be more selective of whom they hire.

The tightening economy is making businesses more selective, Weinstein said.
“In a slow economy and a tight job market, businesses can afford to be more choosy,” Weinstein said.

Carol Nichols, division director of the Fort Worth Office of Robert Half Finance & Accounting, said a decrease in the number of job offers for graduate students could be explained by the cyclical nature of the job market.

“Companies are looking for more than a diploma on the wall,” Nichols said. “They want to hire a well-rounded individual.”

Nichols said one reason fewer MBAs are being hired is that businesses are being more specific about what they're looking for.

“An MBA is still a prerequisite for some jobs, but in addition, they’re also looking for certain certifications,” Nichols said. “Because certifications demonstrate a commitment.”
Certifications such as a CPA (certified public accountant) or CFA (chartered financial analyst) require more schooling but can look good on a resume, Nichols said.

However, Shirley Rasberry, director of the graduate career service center, said she has not found that certifications, except for the CFA, do much for students.

“Employers I have talked to have not indicated that professional certifications make a difference,” Rasberry said. “Having one on your resume may get you an interview, but you still have to interview well, show leadership, accomplishments and experience to get the offer.”

Despite TCU’s record of quick job offers, Jose Tamez, managing partner at the San Antonio office of Austin-Michael, an executive recruiting firm, said students shouldn't expect immediate employment.

“Getting an MBA is just like any other investment, but an MBA is an investment in yourself,” Tamez said. “Sometimes, however, the return comes later than you might expect.”

Andy Chan, director of the MBA Career Management Center at the Stanford Graduate School of Business, made a similar point in a 2003 interview with Business Week.

“Getting an MBA can be a stepping stone to a new career, but it’s not an automatic ticket,” Chan said. “It was never that way. An MBA opens doors, but you have to do a lot on your own to persuade employers to hire you.”

Nichols said MBA students also have a misconception about how much their salary will increase when they get a job.

“What I have found is that students need to be reasonable about how much an MBA will increase their salary,” Nichols said.

Nichols said students shouldn't expect more than a 10 percent increase in salary with an MBA. Experience and soft skills also come into play when it comes to salary, she said.

Tamez agreed and said students can’t assume an MBA by itself always gives them an advantage over an undergraduate degree. He said an MBA looks good on a resume, but that an experienced applicant with a BBA could win a job over an less-experienced applicant with an MBA.

But if a BBA and an MBA had similar skills and experience, Nichols said the degree could end up being the deciding factor.

“An MBA definitely gives applicants a leg up,” Nichols said. “But an MBA and good experience will give applicants the best opportunity for success.”

Tamez said experience is starting to play a bigger role when companies choose an applicant for a job.

“In today’s economy, companies are more likely to hire people that can come on board with little or no ramp-up time as possible,” Tamez said.

Tamez said since some businesses have eliminated internal training programs because they came to believe that they did not offer results quickly enough.

Now, he said, businesses want to hire people who already know what they're doing.
“Businesses are working on a much narrower time frame,” Tamez said. “It is more necessary to get someone who can add value immediately.”

Tamez also said that students must also perform well when they are gaining experience.
“Experience coupled with above average performance, along with an MBA would set a student apart from the crowd,” Tamez said. “But you have to interlock experience with performance because the experience doesn’t do anything for you if you don’t do the job well.”

Greer said finding experienced MBAs usually is not hard, since most graduate business schools require at least two years of experience. Most TCU MBAs already have three to four years of experience when they graduate.

That’s one factor in TCU’s success rate, Greer said. Another is the graduate career services center. Greer said the business school started adding extra staff in the center after the market started to decline.

Rasberry said the center brings in employers to discuss the job market and the job opportunities they will face when they graduate.

“Every MBA has one mandatory one-on-one session with a career counselor, an assigned career counselor, and of course our door is open at all times,” Rasberry said.
Students also take an assessment that gives them specific job interests that they are best suited for, Rasberry said. She said the counselors then encourage students to find targeted companies that have those specific jobs.

Rasberry said TCU’s placement and salary statistics have remained fairly flat for the last three years, but notes that the job market has picked up over the past year.

Rasberry said the center's primary assistance is in employer outreach.

“Our MBA class is very small and typically would not fill a whole interview schedule for a major company,” Rasberry said. “Where we provide the most help is with placements on a one-on-one basis with targeted employers.”

And while the school does all it can for graduating MBA students, Greer said it is “absolutely critical” that students be looking toward the job market on their own while they are still in school.

“Students need to be continually networking and making connections with people in the industry,” Greer said. “They need to keep track of and strengthen contacts through friends, family and the school.”

Tamez said it is very important for students to be watching job trends in college to see what sectors of the economy are hiring and to try to match those with their interests.

Nichols said students should limit their search to about 20 companies if they want to be successful.

And after making that list, she said it is important for students to market themselves well.

“What I tell people is that they need to make a 30-second commercial about themselves,” Nichols said. “It really helps when you go into an interview prepared and with your game-face on.”

Tamez said he still believes students should strive for an MBA if they are willing to go through the extended education.

“An MBA is worth the investment, but it’s like any other investment,” Tamez said. “You may not have an immediate return, but as long as it’s coupled with above average performance, you’ll get a great return.”

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