Fast-growth emerging markets have overtaken the US and Europe as the leading MBA employers, as a sluggish economic recovery in the Eurozone prompts hiring to fall in European countries by as much as 15%.
Fast growing economies in the Middle East, Latin America and in China are forecast to hire the most MBA graduates in 2014, while demand has been more stable in North America and flat across Western Europe.
The data, released this week in the largest global survey of employers, come as the IMF slashed its growth forecast for the Eurozone economy and the seven largest emerging markets become bigger in GDP terms than the long established G7 group of industrialised nations.
Western Europe has the second largest amount of highly-ranked business schools but its employers report 0% net growth in MBA hiring in 2014. In Italy MBA hiring plunged -27% and Spain’s employment contracted -1%, according to The 2014 QS International Employer Survey of 5,669 employers.
In contrast, employment rates in the emerging markets of the Asia Pacific region are strong, with an 11% increase in MBA hiring as the degree has been embraced by Asian employers in India and China who seek global expansion.
There has been an emergence of Asian companies in particular hiring MBA graduates – Asian companies now represent over a quarter of total survey respondents, and there is a rise in elite Asian business schools.
Demand for MBAs in China is the strongest of this region, with Chinese employers forecasting a 17% increase in MBA hiring in 2014, led by banks and IT and computer services companies. The Chinese economy is set to surpass the US as the world's largest economy this year.
Demand is so strong that the Municipality of Shanghai has funded the launch of its own local business school – the Shanghai Advanced Centre for Finance – to compete with other local schools like CEIBS and Cheung Kong Business School.
“Most global companies have an increasing portion of their business in the region,” said Roy Chason, assistant director of marketing at CEIBS.
Japan expects to hire 10% more MBA graduates in 2014, and South Korea reports a 13% growth in MBA hiring, fuelled by big multinationals including electronics groups Samsung and LG, and Hyundai, the car manufacturer.
Stephen Shih, who leads Bain & Company’s MBA recruiting efforts for Asia Pacific, said that he actively recruits MBAs for all of the firm’s offices in the region including Japan, Korea, China and Singapore.
There has been a shortage of management talent in many of these countries, although not at Bain. Stephen said: “It’s primarily the fast growth of companies in the region, which is creating demand that’s outpacing the ability of the region to keep up.”
The UAE is also on the path to recovery, showing a 12% increase in MBA hiring led by banking, energy and IT companies with offices in the region. Banks like Standard Chartered are basing much of their back office operations in Dubai.
Latin America’s jobs market is also stirring, with employers expecting to hire 7% more MBAs in 2014 after a 10% surge last year. Brazil, Argentina and Mexico are the engines of this growth, and their business schools have enjoyed a bigger profile on the world stage.
Professional services firms including EY, Deloitte, KPMG and Accenture have increased MBA hiring throughout Latin America, with the biggest increases in Argentina, while mining and industrial companies such as Grupo Elektra in Brazil are also hiring more MBAs.
BBVA and Banco Santander, which have emerged as regional banking leaders in Latin America, are also actively recruiting.
While the data show that there has been a huge slowdown in employment in some parts of Europe, hiring is expected to pick up in 2015 at financial services firms including BNL in Italy, BNP Paribas, France’s biggest bank, and Santander of Spain.
Many European banks have strengthened their capital/asset ratios and are now highly liquid, and are looking for talented traders to make use of the cheap government capital available to them.
The Eurozone’s largest economy, Germany, is traditionally the engine of MBA demand in Western Europe with companies including electronics conglomerate Siemens and BMW, the car maker, longstanding recruiters. Growth has slowed – but strong demand for German goods in Asia has fuelled a demand for Asian MBAs to join German companies.
However, bilingual speakers are in demand across most of Europe, especially MBAs who can speak Chinese, as China becomes a major market for European exports.
“Currently, the focus continues to be primarily on China, Hong Kong and other Asia-based positions,” said Vinika Rao, executive director of the Emerging Markets Institute at INSEAD, the business school.
“However, as Chinese investment in Europe grows, we anticipate increased interest in hiring bilingual MBAs who can communicate effectively and adapt comfortably to both the site office in Europe and the HQ in China.”
Elsewhere, Russia and Kazakhstan lead the table for growth in total employment, despite the former’s current economic turmoil in light of European sanctions on its economy and the on-going conflict in Ukraine.
Nonetheless, Russian companies want to hire 19% more MBAs in 2014 and Kazakhstan’s firms plan to increase their hiring by 18%.
In the US, the recovery of the economy has previously been shaky and may have held back employer confidence. But this changed with a more robust economy than previous expected, with firms now reporting a 10% increase in MBA hiring across the US and Canada in 2014.
MBAs will still find employment in the west, but it is now the emerging markets that are snapping up the most new hires.