Applications to MBA programs soar

Applications to M.B.A. programs increased 12% in 2024, according to a new survey by the Graduate Management Admission Council, a nonprofit that tracks application trends at leading graduate business schools worldwide.

The rebound, which reverses two years of declines, was most pronounced for full-time, in-person degrees. Applications to those programs rose 32%, the highest level in a decade.

Renewed enthusiasm for the M.B.A. reflects limited prospects for recent college grads despite a still-strong labor market overall, say recent graduates and M.B.A. administrators. Among various factors hurting white-collar work, artificial intelligence has begun to upend some jobs, while more established employees have recently quit job hopping, leaving fewer open roles.

Young college grads choosing to go back to school say the decision could make them stronger job candidates in the future. Both young workers and laid-off older workers often gravitate toward M.B.A. programs during times when they believe there could be an economic downturn.

Scott Karpenos, 23 years old, is pursuing a part-time M.B.A. at New York University’s Stern School of Business while he continues to work for a wealth-management company. His goal: developing new skills to make himself more valuable.

“I wasn’t sure if my job was going to be redundant, so I wanted to go back to school to gain a broader network, just in case," he said.

School by School

Several highly ranked American business schools, including Stanford Graduate School of Business, the Yale School of Management and the University of Pennsylvania’s Wharton School, had double-digit increases in applications to their programs.

Applications to Columbia Business School rose 27%. Harvard Business School registered a 21% increase, while applications to the Booth School of Business at the University of Chicago were 22% higher than 2023.

“With so much change happening in the business and societal landscape, due to artificial intelligence, a changing workforce, and challenges related to sustainability, business education is being recognized as more vital now than ever," said Greg Hanifee, associate dean of degree programs and operations at the Kellogg School of Management at Northwestern University.

Kellogg reported a 23% increase in applications this year, reaching a level not seen since 2020 when the pandemic triggered a wave of layoffs.

Today, the U.S. job market is strong, and unemployment remains low. But lower wage positions in retail and dining, as well as healthcare and government, have fueled much of the labor market’s growth over the past two years.

A white-collar job market downturn that began with tech workers in 2022 has spread to other sectors. Major employers including Goldman Sachs, Lyft, Microsoft and PricewaterhouseCoopers have laid off a combined tens of thousands of workers this year.

Hiring for roles that usually require a bachelor’s degree dropped below 2019 levels in recent months, according to payroll provider ADP. That slump has been steeper for 20-somethings, who are running into a bottleneck on the lower rungs of the corporate ladder as more established professionals stay put.

Mikayla Merchant, 27, was looking to transition from a startup to a bigger tech company in 2023, but the job market became so daunting she decided to pursue her M.B.A. at the Ross School of Business at the University of Michigan instead.

It’s giving her the confidence to pursue roles that previously seemed harder to get.

“I definitely think it will help in my future prospects," she said.

Applications to part-time business school programs rose 9%, and M.B.A. programs with more flexibility are in higher demand, said Joy Jones, chief executive of GMAC. Roughly two-thirds of online and flexible M.B.A. programs reported rising applications. Interest from women increased by 10-percentage points from last year, she added.

“There are people who don’t want to leave roles if they are concerned about the economic environment and its mixed signals, but they still perceive that they need to upskill to be competitive," Jones said.

Write to Ray A. Smith at Ray.Smith@wsj.com