Why You Shouldn’t Do An MBA

The outbreak of Covid-19 caused a sudden increase in MBA applications. This is not uncommon since MBA applications usually go up when the economy goes down historically. But if you are thinking to advance your career through MBA, you may need to rethink about it. A master costs around USD 135,000 from world top business schools (Financial Times, 2016) – not to mention two-year loss of earnings for full-time study – may not worth the investment, especially after Covid-19. Why?

Before the outbreak of Covid, MBA applications were declining. Several business schools in the U.S. closed down their full-time MBA programs. University of Iowa’s Tippie College of Business, for instance, said it would abandon its full-time MBA program to focus on degrees like its part-time masters in business analytics.

The MBA might be the only option you had, ten years ago, to accelerate your career path. But the market has shifted, the value of an MBA today is questionable. Some said that the MBA is largely irrelevant in today’s business world. By the time you finish your first year, technology changes and what you have learned may be outdated. And if this is the case, you are wasting not only the program fee in monetary terms, but the opportunity cost – missing out on the latest developments in a fast-moving industry.

Traditionally, a business school acts as a platform to connect future leaders and alumni. But due to lockdowns, most of the courses are conducted online now. This may limit down your opportunity to expand and diversify your network.

In Malaysia, an MBA costs between RM18,000 (public university) to RM80,000 (private university). The total compensation of a fresh MBA graduate with 1-4 years of experience, according to payscale.com, is RM48,350 annually on average. An early career Data Scientist with similar years of experience on the other hand, earns an average total compensation of RM 58,439.

Pay scale of MBA graduates in Malaysia

 Source: payscale.com / Study Masters (Note: report publishing year is unclear)

In short, obtaining an MBA may help you in the job market but will burden you with a hefty debt. If you are still insisting to pursue an MBA degree, consider a part-time one. Business schools are adapting to the change and many are introducing more specialized master programs. There are now MBAs with data analytics, cybersecurity, or financial technology. Think about it!

 

Reference:

1.     Paulina Karpis, Is An MBA Worth It? After Covid-19, Absolutely Not, 25 Jun 2020, Forbes

2.   Kelsey Gee, M.B.A. Applications Decline for Third Year in a Row, 18 Sep 2017, Wall Street Journal

3.     Laurent Ortmans, MBA by numbers: inside the $200,000 cost, 15 Feb 2016, Financial Times

4.     Key statistics for MBA graduates in Malaysia, Study Masters