Will Weinig believes a master’s degree in business administration from Washington State University Vancouver will give him an edge in the international hospitality and tourism industry. An MBA, says the German-born 24-year-old, will improve his marketability, enrich his knowledge of business theory and give him a distinctively American credential in a competitive global job market.
An estimated 3,400 others studying at 15 public and private institutions in Washington state see it more or less the same way: An MBA is a career plus, worth the investment in time and money, not only for the degree but also for the network of classmates, faculty and alumni that comes with it.
The money part, however, can be daunting. Average annual tuition per student ranges from $10,000 at WSU Vancouver to more than $40,000 for certain specialty MBAs at Seattle University and the University of Washington.
For the schools—large and small, public and private— MBA programs are big business. In Washington, these programs generate estimated tuition revenue of more than $70 million a year. And that amount doesn’t include room, board and other student costs. But rising tuition, changing corporate hiring strategies and weakened postgraduate salaries have some wondering about the ongoing value of an MBA. That perception, combined with stiff competition for qualified students, declining full-time MBA enrollment and rising operating costs, presents challenges for the state’s graduate business school administrators where MBA programs are typically self-supporting.
“It is taking more effort to attract students to your institution,” says Marilyn Gist, associate dean of the highly ranked graduate programs at Seattle University’s Albers School of Business and Economics. “Students are reluctant to take on more debt at the graduate level.”
Meanwhile, fewer students are applying to the many available seats in full-time MBA programs. Bloomberg Businessweek reported last year that 62 percent of full-time, two-year programs noted a decline in applications.
To better compete, many schools are redesigning their curricula, expanding specialty programs, offering more parttime, night-school and online classes and shortening the length of course work for certain degrees so students don’t have to take as much time from their busy schedules to complete their degrees.
Gist says Seattle University is customizing its programs to fit the needs of its students. The Albers School offers a “bridge” MBA program for younger students without work experience and is preparing to roll out some hybrid MBA course work that blends classroom and online study. Gonzaga University in Spokane also has a hybrid MBA program that combines online studies with classroom experience. “I don’t see us offering a total online program,” says Jinny Piskel, Gonzaga’s director of the Graduate School of Business. “Our competitive market advantage is in the value-added classroom experience.”
As competition intensifies, it is becoming increasingly important for schools to find a place in national rankings. Gonzaga was pleased to land a spot in U.S. News & World Report’s list that ranked its part-time MBA program 73rd best in the nation. Seattle University’s full-time Leadership Executive MBA was ranked 19th in the nation by U.S. News. The evening school at the University of Washington’s Foster School of Business placed No. 15 and a specialized MBA in accounting placed No. 18.
U.S. News scored the Foster School’s traditional MBA program an impressive 23rd in the nation, while The Economist scored it 34th in the world. A strong job placement record of 96.8 percent was a factor in those rankings, says Assistant Dean Dan Poston. In hopes of breaking into the exclusive U.S. News “Top 20 Business Schools” list, the Foster School recently reduced the number of students accepted into its program. That raises the quality of the average student accepted as well as their average test scores.
During the worst of the recent recession, Washington State University dropped its on-campus MBA program at the main campus in Pullman while maintaining branch campus offerings. The business faculty then decided to ramp up its online-only MBA. That effort was rewarded this spring with a No. 1 national ranking from U.S. News & World Report.
With 160 students, the online program is five years ahead of enrollment projections, says Cheryl Oliver, WSU director of graduate programs. Most students (60 percent) are from the Northwest, with others in the military overseas, some in the Middle East, Japan and South Africa. “It may not be realistic given the market, but we would like to see this program grow into the thousands,” Oliver says. “When you’ve got the No. 1 online program, it matters.”
Meanwhile, WSU is relaunching its oncampus MBA program in Pullman this fall, she says.
As tuitions soar, student debts rise and jobs remain scarce, there has been a reassessment of the value of the MBA. “Smaller paychecks await newly minted MBAs, especially from less prestigious schools,” The Wall Street Journal reported recently. “There are officially too many MBAs,” added The Atlantic. In 2011, 126,214 students earned MBA degrees in the United States, up 74 percent from 2000-2001. More than 600,000 people now hold an MBA from American institutions.
Still, many say the need remains. “We see endless MBA bashing in the national media because these stories will be read,” says John Byrne, founder and regular contributor to Poets&Quants.com, a website geared toward MBA students, potential students and graduate business schools. “That’s because the MBA remains a highly popular degree … and a degree where people immediately want to measure the outcomes. But simply measuring the money you earn at graduation or three months after graduation is not the full story.”
As earning an MBA has become more expensive and salaries have flattened, the return on investment has fallen. Ten years ago, an MBA would typically triple a person’s income. Now, it more likely doubles one’s income, but it’s still a pretty good return. While the number of applicants at two-year programs has declined, the quality of enrollees at the top schools remains high.
“Even if you only attend a school among the top 50, you have a degree that still separates you out of the pile,” says Byrne. “An MBA tells people you are ambitious for your career and for yourself, even if the degree is from a program no one has heard of.”
Increasingly, students are using the MBA not to turbocharge their existing careers, but to move into a completely new field. “Someone may be coming out of the military who wants to move into the private sector or a schoolteacher may want to work in marketing,” explains the UW’s Poston. To address those needs, he says, the UW, which has a total enrollment of about 750, is now offering an array of degrees with special areas of emphasis such as global executive, technology management, culture and values, and international development. Seattle U and Gonzaga both offer programs in health care management.
“It’s not an easy market to compete in,” says Jerry Goodstein, MBA program faculty director at WSU Vancouver. “We have to be very thoughtful about how we value and differentiate our program.” One way schools are responding to student needs is by providing more flexibility. “MBA students want convenience and less time away from their families,” says Tate White, assistant director of graduate studies in business at Whitworth University in Spokane. “When you have a job and a family, adding MBA study on top of that is challenging.” At Whitworth, there are 40 students in the MBA program and they attend only evening classes one or two times a week.
But do MBAs really help students find a job? Charles Mah, a top recruiter at Redmond-based Concur Technologies, thinks so. Concur, an integrated travel and expense management software business, uses an internship agreement with the University of Washington to gain access to MBA students. “Our goal is to broadly hire innovative talent, not just MBAs,” says Mah, “then make sure we provide the right mentoring with competitive pay.”
Mah himself is considering pursuing an MBA. “I’m looking at an international focus or an executive MBA,” he says. “With an MBA, you get business planning skills, analytics and innovation development from conception to reality.”
Karen Montague, who earned an MBA from the UW 27 years ago, says when she received her degree there was no question of its value. “I’m sure my first job off er came because I had just gotten an MBA,” says Montague, who has worked for Weyerhaeuser and Eddie Bauer. Today, she says the value of the MBA may not be as self-evident but that “for most, it’s a good notch in your belt.”
The current economic recovery could do more than anything else to help restore the luster of the MBA. Kurt Kirstein, dean of the School of Management at City University, which boasts one of the largest MBA enrollments in the Puget Sound region, is optimistic that demand for MBA degrees across all platforms will continue to increase as the economy improves. “We saw enrollment at the start of the recession take a big jump, then drop off ,” Kirstein says. “We had 100 students finishing the program and only 80 new ones starting. Now enrollment is rebounding.”
Meanwhile, German-born Will Weinig, the MBA student at WSU Vancouver, is glad to be in the United States getting a graduate degree. His next step is to land a business internship, he says. “I’m open to where that might be … the U.S. or Europe,” and he’s sure the MBA will improve his chances.
MBA PROGRAMS IN WASHINGTON
Washington’s accredited Master’s in Business Administration programs, listed in order of total enrollment. (Tuition prices vary with student in-state residency or military status and full- or part-time coursework.)
University of Washington
Foster School of Business, Seattle; Milgard School of Business, Tacoma; UW Bothell School of Business
Puget Sound enrollment: 750
Annual Tuition: $12,500 to $40,170
MBA areas of emphasis: technology management, international development policy, executive, leadership, global executive
Websites: foster.washington.edu; tacoma.uw.edu/milgard-school-business; bothell.washington.edu/business
City University of Seattle
Puget Sound enrollment: 786
Annual tuition: $11,016 to $22,788 (online and in-class options at Bellevue, Everett, Renton, Seattle, Tacoma)
MBA areas of emphasis: technology management, accounting, finance, sustainable business, project management, change leadership, global management, human resource management, global marketing
Albers School of Business & Economics
Annual tuition: $37,344 to $40,800
MBA areas of emphasis: leadership executive, entrepreneurship, health leadership, executive, accounting, business valuation, sustainability
College of Business
Washington ENrollment: 612
Annual Tuition: $6,500
MBA Areas of Emphasis: management and strategy,
health care management, IT management
Washington State University
College of Business
Enrollment: 350 (including online, Tri-Cities, Spokane and Vancouver)
Annual tuition: $11,736 to $30,000
MBA areas of emphasis: accounting, finance, hospitality and tourism, information systems, management, marketing, organizations, health care management, international business
Website: gradschool.wsu.edu; vancouver.wsu.edu/mba
Graduate School of Business
Spokane enrollment: 260
Annual tuition: $28,710
MBA areas of emphasis: American Indian entrepreneurship, health care management, finance, marketing, entrepreneurship
Bainbridge Graduate Institute
Puget Sound enrollment: 125
Annual tuition: $27,720 to $31,717
MBA areas of emphasis: sustainable systems, sustainable business management
Western Washington University
College of Business and Economics
Bellingham-Everett enrollment: 115
Annual tuition: $15,718 to $25,692
MBA areas of emphasis: accounting, general business administration, international business, marketing, operations management, finance, management, management information systems
Seattle Pacific University
School of Business and Economics
Annual tuition: $17,055 to $27,288 (evenings and weekends only)
MBA areas of emphasis: finance, human resource management, information systems management, international business, management, social and sustainable business, technology management
Eastern Washington University
College of Business and Public Administration
Cheney enrollment: 100
Annual tuition: $11,360 to $13,925
MBA areas of emphasis: finance, information technology
St. Martin’s University
School of Business
Annual tuition: $14,760 to $32,740 (evenings and weekends only)
MBA areas of emphasis: accounting, economics, finance, management, marketing
Pacific Lutheran University
School of Business
Tacoma enrollment: 65
Annual tuition: $19,458 to $29,187 (evenings only)
MBA areas of emphasis: management, technology-innovation, health care, entrepreneurship and closely held business
School of Global Commerce & Management
Spokane enrollment: 32
Annual tuition: $13,015 to $16,097 (evenings only, accelerated format)
MBA areas of emphasis: general business administration, international management
College of Business
Annual tuition: $21,630
MBA areas of emphasis: accounting, extended fundamentals of management, fundamentals of management, global business sustainability, human resource management, information systems, international business, management, marketing, nonprofit management, organizational management, service sector management
University of Phoenix
School of Business
Puget Sound enrollment: Unavailable
Annual tuition: $11,865 to $39,960
MBA areas of emphasis: marketing, energy management, global management, health care management, project management, technology management, accounting, human resource management
NOTABLE EXECUTIVES WITH AN MBA
CEO, Boeing Commercial Airplanes
MBA, University of Puget Sound
MBA, Harvard University
Director, Washington State Department of Revenue
MBA, Seattle U, Albers School of Business & Economics
CEO, Yakima National Bank
MBA, Washington State University
M.S. in Business, Stanford University
CEO, Alaska Airlines
MBA, UW Foster School of Business
NOTABLE EXECUTIVES WITHOUT AN MBA
B.A., Mathematics/Economics, Harvard University
B.S., Computer Science & Engineering, Princeton U.
President & CEO, Columbia Bank
B.A., Political Science, University of Washington
Ph.D., English, Univeristy of Arizona
President & CEO, Columbia Hospitality
B.A., Urban Affairs/Political Science, U. of Puget Sound
Chairman and CEO, Starbucks
B.A., Communications, Northern Michigan University