PROVO — When Kendra Wirig was trying to make up her mind about which business graduate school she wanted to attend, she gave thought to Harvard, Yale, Columbia and some of the other top-ranked Ivy League schools that offer a master's of business administration degree.
She knew she had the test scores and undergraduate grades to get into one of those top MBA programs, but she also knew she'd emerge with a mountain of debt from the loans she would need to pay the hefty costs associated with those prestigious institutions.
After crunching the numbers, she and her husband decided that since he wants to go to dental school next year — an even more expensive enterprise — the best deal seemed to be Brigham Young University's Marriott School, whose MBA program was the only business school in the Mountain West to be highly ranked by several national publications but where tuition and fees total less than $8,000 per year, compared to about $30,000 for Harvard.
Besides, Wirig earned her undergraduate degree at BYU (political science major, business minor) and would feel right at home on the Provo campus. The Wirigs are members of The Church of Jesus Christ of Latter-day Saints, and BYU is the largest privately owned, church-sponsored university in the United States.
Also the most generous. School officials credit the church's contributions to the MBA program with keeping costs relatively low. There are also scholarships available, especially for international students.
Now, as a second-year MBA candidate, Wirig is even more certain that she made the right choice.
Last month, Forbes magazine ranked BYU's Marriott School MBA program the "Best Bang for the Buck" among regional business schools, where graduates of the two-year program saw their salaries soar 250 percent from before they entered the program in 1996 to last year.
On average, said Forbes, it took Marriott School MBA grads just 3.3 years to recoup their investment, based on students' salaries before they entered the MBA program, the cost of the program, post-MBA salaries and salaries five years after graduation.
Wirig will graduate in April at about the time many analysts believe the nation should begin recovering from the economic downturn that began in March 2000. She recognizes that the job market now is soft, but she believes that will mean that instead of five or six job offers she'll have to choose between two or three.
And she doesn't expect to take 3.3 years to recoup her investment.
"I was making only $24,000 a year before I entered the program, so I expect about a 300 percent increase when I graduate," she said. "An offer above $80,000 is my goal, so figuring tuition costs and opportunity costs (not working during her two years in school), I expect to make those costs up in nine months."
Nice deal if you can get it. But is $80,000 a realistic expectation for a fledgling MBA grad? No question, said Ned C. Hill, dean of the Marriott School.
"This last year our average MBA went out at $78,000 for their first job. Before getting the degree, they were earning in the $30,000-to-$40,000 range," he said.
Nor is Wirig's optimism about job offers misplaced, Hill said.
"One hundred percent of our MBA candidates get at least one job offer, and (the last graduating class in April 2001) was 99 percent placed by the end of July, and a couple of days after that, 100 percent. And many of them had multiple offers."
Sound like a license to print money? That argument could certainly be made, because it's hard to imagine any other two-year degree offering that kind of quick payback. But it's just for that reason that BYU's MBA program is so popular — and competitive, said Henry J. Eyring, director of the Marriott School's MBA program.
"As the competition to get in becomes more intense, I expect there may be a BCS ranking in business," quipped Eyring, a joking reference to the attempt by the BYU Cougars football team to join that exclusive club and be invited to one of the lucrative Bowl Championship Series games.
But he was only half-kidding. The number of MBA applicants at BYU continues to grow much faster than the available positions in the program. Thus, the entry bar must be raised every year.
"Unless there is an increase in class sizes, supply and demand means students are facing stiffer competition," said Eyring, himself a graduate of BYU's MBA program. "Last year alone, our GMAT (Graduate Management Admissions Test) scores went from an average of 645 to 660, which leaves a lot of people out in the cold."
Currently, Eyring said, the average GMAT score for those admitted to the MBA program is 665, likely placing it among the top 25 schools in the country on that criterion alone.
The admissions process is further complicated by the fact that most MBA candidates are not allowed to enroll directly after receiving their undergraduate degrees. It's an established tradition at business schools that MBA candidates spend at least a few years in the workplace before entering the program.
Nor is an undergraduate business degree a help getting in, something that comes as a shock to many business undergrads, Hill said. "We encourage people who want an MBA to major in economics or language or engineering or science — something like that. We give a slight preference to those who do not have a business background. That's a big misunderstanding among our own students."
According to Eyring, the average BYU MBA candidate has worked three years before entering the program, except for engineering undergrads, who are admitted with no work experience because their technical education is considered so valuable.
Thus, he said, the average age of BYU's MBA candidates is 28, meaning most are married and many have children — along with all the bills that go with that status. That makes quitting a "pretty good" job to go to school for two years an even greater sacrifice, Eyring said, although most find it to be well worth it, even in the short run.
Eyring wants to make it clear that Forbes did not rank BYU's MBA program best in the nation — it listed 25 large (and expensive) universities in that category, with Harvard at the top. The magazine also listed 12 schools located in other countries for top honors, noting, "The MBA has become a global currency of intellectual capital." BYU was number one among the smaller, regional schools.
"Many (MBA) students don't want to head to Wall Street or a big financial firm where 70 percent of the Ivy League graduates end up," Eyring said. "What Forbes said is that there are some students who want a good business education, but at less expense, and they'd like to have graduated by the time they're 30 years old and not have a mountain of debt. Forbes says we do that better than anyone else."
But that doesn't mean BYU grads have to go to work for small, unknown companies. Most students say they want to work for a Fortune 500 company, and many do. Offers are especially forthcoming from Ford Motor Co. (BYU supplies more master's level graduates to Ford than do Michigan and Michigan State universities) and Intel, both of which have taken a special interest in BYU grads.
And the current recession? Ironically, economic downturns actually create a bull market for business graduate schools. People who have been laid off their jobs find making the decision to return to school much easier than when they are employed.
E-mail: max@desnews.com