Forbes Magazine ranks UConn's M.B.A. program among nations best (Released: 2/3/00)
by David Bauman, Office of University Communications
STORRS, Conn. -- As an investment value, the M.B.A. program at the University of Connecticut's School of Business ranks among the nation's best, according to a new survey evaluating the USA's top 50 business schools in Forbes magazine.
The latest issue of Forbes, dated Feb. 7th and available on news stands now, ranks the nation's top 25 national business schools and the 25 top regional B-schools according to the return on investment students can expect from earning their M.B.A. degrees by attending those schools.
"Students can give up a very substantial amount of money to obtain an M.B.A., in terms of tuition and lost income, so they need to ask what they can expect in return," says Richard Dino, associate dean of UConn's School of Business and executive director of its M.B.A. programs. "No survey until now answered that question in a way that is consistent with sound financial decision-making. This survey really captures the full impact of that return on investment calculation."
Forbes divided the B-schools in its survey into two groups. Schools where the median cost (tuition and lost income) was more than $90,000 were placed in the national category; programs where the median costs were less than $90,000 were classified as regional schools. For the most part, the schools in the regional category are public and draw the bulk of their students from within a few hundred miles, according to the magazine.
UConn's School of Business was ranked 15th among the top 25 regional B-schools, ahead of such schools as Arizona, Arizona State, Washington and Florida, and just behind Penn State (No. 12), Illinois (No. 13), and Rice University in Texas (No. 14). Among national business schools, Harvard students gained the most from going back to school to earn an M.B.A., even though their costs -- $200,000, $50,000 for tuition and $150,000 in lost compensation -- were the highest.
The typical graduate of a national B-school program enjoyed salary gains of $37,000 over the four-year period surveyed by the magazine, compared to a $23,000 average salary increase for regional B-school graduates. But the lower-cost regional M.B.A. programs hold their own against national schools in return on investment. Their gain as a percent of expenses averaged 33 percent, just about the same as for the national MBA programs.
Forbes' ranking of M.B.A. programs is the second national survey of top business schools that includes UConn's School of Business among the nation's best. In November, Computerworld's third annual survey of M.B.A. programs doing the best job preparing technology-savvy executives ranked UConn's program 23rd. (Additionally, in October, the U.S. News & World Report's annual College Ranking ranked the School of Business Management Department as 28th in the country.)
"This is the second national ranking UConn's M.B.A. program has received in the last six months that is the result of a true market performance test," noted Dino. "Both the new Forbes and this fall's Top 25 Techno-M.B.A. Computerworld rankings are based on market-driven criteria and are extremely valuable in demonstrating our success in recruitment and placement."
Business school administrators recognize that the growing number of national magazine surveys of this kind are closely watched and influence prospective students. Yet they also contend that some of the magazine rankings are inadequate measures to evaluate the relative merits of M.B.A. programs.
For example, Business Week's rankings of the nation's top M.B.A. programs, published every two years, extensively polls graduates, recent alumni and the companies who recruit them, meaning it is perceptual to a large degree.
Similarly, U.S. News & World Report's survey of B-school programs uses data such as starting pay, average GMAT scores, percentage of students who apply compared to the number admitted, along with the results of two reputation surveys filled out by B-school deans and corporate recruiters. Again, its rankings are based largely on their perception of academic quality.
To calculate the worth of an M.B.A. Forbes compared the salary gains it generated to the cost of getting it. The magazine started with surveys of each school's class of 1994, asking students to disclose (anonymously) their compensation just before matriculating, after graduation and four and a half years later.
Forbes then constructed a sequence of estimated median incomes, year by year, for each school's class of 1994. It then compared those numbers to what the same students would have earned without degrees, assuming that their salary growth would have been only half as fast.
Thus Forbes' ranking takes into account the fact that schools vary widely in how much their students were making before they enrolled, as well as five years out of school. The median M.B.A. gain for students at the 50 schools surveyed was $29,000. On average, the magazine reported that graduates were able to recoup all their investment (forgone salary and tuition) in just 4.1 years.
"Unlike many other rankings that evaluate M.B.A. programs based on today's data, Forbes performed a return on investment follow up analysis five years after graduation," said Thomas Gutteridge, dean of the School of Business. "Such a follow up study based on empirical returns over time validates the success of our program and our alumni."
Tuition in UConn's M.B.A. program is currently $6,230 in-state and $14,654 out-of-state, including a high value-added education especially when compared to private schools. Its graduates are recruited by companies such as IBM, GE Capital, United technologies, Anderson Consulting, CitiGroup, among many others.