Data points to recruiters keeping headcount stable in 2020 as employers exhibit caution in maintaining talent amidst downturn
The Graduate Management Admission Council™ (GMAC™), a global association of leading graduate business schools, in partnership with MBA Career Services & Employer Alliance (MBA CSEA), the European Foundation for Management Development (EFMD) and Highered has released its annual 2020 Corporate Recruiters Survey. As this year’s report was nearing conclusion in March, COVID-19 was unfolding. Given the disruption caused by the global pandemic, GMAC initiated additional data collection to expand those results to provide more relevant insights about the economic impacts of COVID-19 across hiring and salary trends. Additionally, deeper perspective was gained on the skills that employers are looking for as organizations continue to grapple with the economic downturn.
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In this year’s report, employers expressed optimism for the future which is noteworthy given the uncertainty and economic retraction that has gripped the global economy since March. Before COVID-19, 92 percent of firms expressed intent to hire MBA graduates in 2020, a figure that dipped to 77 percent during sampling amid COVID-19. However, when asked about hiring plans for 2021 nearly 90 percent of employers said they plan to hire MBA graduates, a level similar to the rate seen in the pre-COVID sampling.
“When thinking about the skills and experience required to help organizations and industries rebuild after an event like COVID-19, it makes sense that employers are expressing a desire to hire more MBA and business master’s graduates,” said Sangeet Chowfla, president and chief executive officer at GMAC. “The world was changing rapidly even before the current pandemic and while COVID-19 has brought with it perhaps unprecedented challenges across every sector, b-school classrooms have long been preparing MBA students for a dynamic and often uncertain environment. Employers place a premium on that kind of talent and perspective.”
Skill Demand: Stability in Times of Disruption
As the pandemic continues to shake the global economy, disrupting supply chains and shaping the future of work, corporate recruiters’ confidence in the skills and abilities of graduate management talent remains strong.
Before COVID-19, 90 percent of respondents indicated they were highly confident or confident about the ability of business schools to prepare students for success in their organization. That figure held steady at 87 percent in surveying performed this summer, highlighting the attractiveness of MBA degree holders and their ability to perform in times of transition and change.
“Talent in an organization is vital to growth and a firm’s ability to innovate, a reality in any environment,” said Jay Nibbe, GMAC board member and global vice chair for markets at EY. “The skills highlighted in this report represent significant competitive differentiation when it comes to a company’s ability to compete and create value in the marketplace, and they become even more important amid turmoil and constant change.”
Recruiters cited strategic thinking, communication skills, and versatility as the skills they’re most confident in when it comes to a business school’s ability to prepare graduates for success in the workforce. These skills hold steady across the entire report.
One of the more noteworthy shifts when examining skills demand is the ability to navigate the challenges of technological disruption, which was identified by more than two-thirds of employers who responded as becoming more important as a result of COVID-19, followed by strong communication skills.
“GMAC’s research shows that even as the pandemic resets the global economy and job market, the confidence of corporate recruiters in the skills and abilities of graduate management talent is strong,” said Rahul Choudaha, director of Industry Insights at GMAC. “This aligns with 2021’s robust MBA hiring projections as organizations plan for their recovery in a post-COVID world which demands meta-skills integral to managerial talents such as versatility and strategic thinking.”
Salary Trends: Premium Endures Under Pressure
In the pandemic context, compensation is under pressure at all levels as companies focus on operational sustainability, and as the demand and supply of talent shifts in favor of employers. And yet, for the class of 2020, most recruiters expressed intent to honor their organization’s compensation promises, with a minority of respondents saying they will reduce salaries, benefits, or bonuses.
Also, the compensation premium that business management graduates command is holding steady. At $115,000, the median salary of MBA degree-holders is 75 percent more than those with a bachelor’s degree in pre-COVID sampling. That figure decreased slightly to $105,000 amid COVID-19 surveying. The compensation premium is even more apparent for Fortune 100 companies and the big-three industries of hire for MBA graduates—consulting, finance, and technology. For example, at $145,000, the median salary of MBAs in the consulting industry is twice that of bachelor’s degree holders as indicated in data collected prior to March 17. In sum, responses collected in this year’s Corporate Recruiters Survey suggest that salaries for graduate management talent are relatively less likely to soften in the COVID-19 environment.
For further insight into the report you’re invited to join a complimentary GMAC webinar on October 1 where industry experts will discuss highlights of the report and implications for business schools and employers.