Each year since 2009 most US part-time MBAs have reported either falling or flat application volumes. In 2017, fewer than half of the courses reported application growth, GMAC said.
Falling employer funding for management education since the financial crisis may have contributed to the flagging demand for part-time MBAs.
Separate GMAC data on 'professional' MBA alumni—which includes part-time online and executive MBAs—show the share of students receiving funding dropped from around two in three for the graduating class of 1996 to less than one in two for the graduating class of 2015.
One bright spot is 'lockstep' MBA programs, in which all students study the same curriculum at the same time. Most part-time lockstep MBA programs grew their application volume for three consecutive years, GMAC reported.
That is because lockstep courses focus more on group experience and participants may build stronger networks as a result, according to GMAC.
Compounding that trend is the fact that millennials—those who reached early adulthood at the start of the new millenium—now account for nearly nine in 10 US resident part-time MBA students, said GMAC. Surveys suggested that millennials expect a community experience, flexibility, and the option to specialize their degree.
Millennials are also increasingly concerned about the cost of an MBA, and their employers are less likely to help them pay for it than in the past, the organization said.
Part-time MBA programs can future-proof their success by turning to technology. MBA programs have in recent years sought to blend online and face-to-face content to meet the needs of students who are looking for more flexibility in how and when they study, said Dan LeClair, chief strategy and innovation officer at the AACSB accrediting body.
“We see an increase in more hybrid education,” he said. “One reason is that businesses are using more virtual teams, although face-to-face teams are still a reality of business.”
Many schools have found success delivering customized courses designed specifically for employers—INSEAD launched a web and mobile-based solution that delivered high-quality video lectures to companies including Microsoft and Accenture.
But technology is a double-edged sword for business schools, as it has led to the rise of new digital-enabled competitors, such as the providers of Moocs like Coursera, which has more than 30 million users.
“If they [business schools] don’t innovate now, they will struggle to stay relevant,” added AACSB’s Dan.
There are other ways for part-time MBA courses to remain relevant. GMAC said that developing group learning opportunities, specializations and career support would be worthwhile investments.
In addition, increasing the diversity of part-time courses could improve overall demand for them. “They tend to attract local talent and that can be a downside for employers looking to build an international talent pipeline,” said Sandy Khan, a former recruiter and now founder of IN-CO, which hosts events where MBAs meet business leaders.