GMAT Demand Increases Among Young People in Financial Downturn
The number of young people sitting the GMAT has grown as the global economy has slowed, according to the latest data from the Graduate Management Admissions Council (GMAC).
Between 2005 and 2009 the average age of GMAT test-takers fell from 27.9 years to 26.7 years. Last year, 106,152 examinees aged younger than 25 sat the GMAT worldwide: a 72 per cent rise on 2005.
Over the same period, the total number of GMAT examinees grew by 32 per cent.
The “tough economy”, according to GMAC research analyst Alex Chisholm, has “added extra spice” to young people’s decision about their professional future.
Alex Chisholm is a senior research analyst at the Graduate Management Admissions Council
“Many undergrads who would normally have found employment are now unable to do so,” says the current member of Economics Department at Northern Virginia Community College. “So they choose to remain in schools.”
Ed Aguilar, who is going through the MBA admission process at the moment, proposes another reason for the boom in business education: “From what I’ve read, the unemployment rate continues to rise, so people who have lost their jobs are looking at MBA as a way to get back [to work].
“It [the credit crunch] definitely played a big part,” he says.
Aguilar worked for a small engineering firm in Greater New York region for two years after graduating from Stevens Institute of Technology. After scoring 770 in his GMAT, the 24-year-old is now waiting to hear back from Columbia Business School and Yale School of management.
“Several pre-experiential business programs around the world have begun to rely on the GMAT exam to help their admissions process,” says Chisholm, stressing the growing trend of b-schools embracing young people who don’t have much work experience.
Women, who made up 40 per cent of 2009’s GMAT examinees worldwide, tend to take the exam when they are young. Last year’s GMAC data shows that for the 25-and-under examinees, the ratio of male to female candidates was 52:48.
However among test-takers aged 25 to 30, only 36 per cent were women.
The umber of GMAT candidates aged between 25 and 29 increased by 26 per cent from 2005 to 2009. Chisholm says this trend “makes sense to him”, because "many people in this age group tend not to be happy with their jobs, and want a change".
Going to b-school can help change lives, but that’s less the case for the over-30s among who the number taking GMAT has dropped by eight per cent since 2005.
“They are of course more settled than the younger ones so they aren’t as motivated by the financial crisis,” says Chisholm.
Other data gathered over the four-year period (2004-2008) shows that examinees younger than 20 years delivered the best average GMAT score (586), beating the second-best age category (26 to 27 years) by 34 points.
Chisholm says it “makes sense” because people who take GMAT when they are still teenagers normally have gone to college at a “very young age” and done “extremely well” in high school.
When commenting the “best possible age” to sit GMAT, Chisholm is unsure: “I don’t think there’s one. Even if the ‘perfect’ age could be determined it wouldn’t mean much without taking into account all of the other factors that a school considers when selecting students,” he says.
But Colombia hopeful Aguilar thinks differently: “I think 23 or 24 is a pretty good age to take GMAT,” he says. “People at this age are close to the so-called ‘studying age’.
“They are recent college graduates, so [they] should still be in the right frame of mind to study,” he adds.
According to the most recent data from the US National Centre for Education Statistics, one out of four US graduate students is in business education. Among US undergrads, about 20 per cent are in business-related majors.
Chisholm says that’s because b-schools are now “differentiating” their programs. He also thinks schools’ desire to fill their classrooms with a more diverse group of students, including younger ones, contributes to this phenomenon.
Aguilar says young people’s lack of work experience isn’t necessarily a disadvantage: “[For the older students] once they have been in the industry, they tend to think more like the industry.
“If you’d been a banker for years, you would probably think like a banker all the time,” he adds. “Young people can make schools more diversified because they bring in fresher minds.”
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