MBA/PGDM Certificates Can’t Guarantee a Job Any More

The MBA/PGDM is no longer a passport for the flight of a successful career. 
Barring a few top B-schools two in three MBAs remain either unemployed or underemployed. 

Almost two thirds of graduates passing out every year, except the handful of top B-schools, including the IIMs, are struggling to find meaningful employment, according to multiple estimates. There is plenty of anecdotal evidence to back this up. 

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Only 21% MBAs are employable, says a report by Meritrac. Tire -II B-Schools  managed to place only 30-40% students at just Rs. 12,000- Rs. 18,000 per month.

Vidhi Sen, an MBA in financial markets this May from the 2011-2013 batch of a Ghaziabad-based institute is yet to land a job with 40% of her batchmates. “We are still hunting,” says Ms. Sen, who spent 4.50 lakh for a two-year programme. 


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Saloni Kesarwani, who graduated from Amity International Business School last year, didn’t have luck with placement either, but eventually landed a job through personal reference. 
Many of her friends who managed to get placed started with salaries in the 3-4 lakh range. 

The MBA cost 9 lakh.  

Even the IIMs took longer than usual to place their entire batch this year. Less than 4 lakh students sat for national-level B-School entrance tests (MAT, CAT, XAT, CMAT etc) in 2012-13, compared with a 2008-09 peak of 5 lakh plus, according to AIMA. 

It also said some estimates suggest that 400-odd startup B-Schools have shut shop during the past year or so. With the economy in a prolonged slowdown, there is hardly any new job creation in many sectors. 

But that’s not the only reason MBAs are losing sheen. Several surveys suggest the enormous gap between the top MBA colleges in the country and the tier-2, tier-3 and tier-4 colleges in terms of access to research, quality of faculty and their linkages with business and industry. 

Management education is supposed to be built on the strength of these factors and a robust industry interface is lacking at the tier-2, tier-3 colleges. 

Training and development firm Elements Akademia, which studied 4,000 students across 200 tier-2, 3 and 4 MBA colleges in 20 cities in April this year, found poor corporate interaction, inexperienced faculty members and dismal placements at these institutes. Problem of Plenty. Most tier-2 B-schools managed to place only 30-40% graduates. 

A majority of those who did find jobs started off with a pay of only Rs 12,000-18,000 per month. In 197 of the 200 B-schools, students expressed regret at joining their college.  

There are fundamental issues of academic delivery quality as most run-of-the mill colleges spend less than 10% of their revenues on actual academic delivery, says experts.

Not only have more institutes mushroomed, but even the volume of students at old and established and new and unproven B-schools has increased exponentially. The slowdown is making placement even more difficult. 

Most companies have been focusing on restructuring, cost-efficiency and right-sizing. “If there were three jobs at one point, companies are now trying to see if they can do with one. 

On the other hand, the volume of talent available in the market is rising,” says Gaurav Lahiri, managing director of the India unit of global management consulting firm Hay Group. 

Institutes too admit that a bad market is making placements challenging. “Slowdown has hit placements and recruitment volumes have gone down for major recruiters. 

Salary packages have also not increased with respect to inflation,” says a spokesperson from Amity University, Noida, which has trained nearly 4,700 graduates in the past five years. 

Also, the majority of talent opting for an MBA in India is raw, unlike the global business schools or a few Indian institutes like ISB, where people come in for their management education after working in industry for some years. 

In India too they need to move in that direction. This will make classroom conversations richer from a practical standpoint and will improve their employability.

Data Source-Print Media