Eating is an agricultural act - Wendell Berry

Tuesday, October 12, 2010

MBAs - staggering costs

i did a PGDM (post graduate diploma in management) between 1996-98.
this is equivalent to an MBA.
i simply followed the herd in coming to that decision.
i had a year of work preceding which was a very special one year. my very first post has a few lines on those days.

i remember having spent around Rs 3 lakhs for the 2 years in fees and all hostel expenses.

since that time, the MBA gold rush has been on hyper mode. i read on wikipedia that there are 1600 colleges offering this degree.
read rashmi bansal's recent rediff article - the MBA gold rush is over - it shocks from the cost angle.
The average ISB student will pay an EMI of Rs 25,000 over seven years.
An IIM student will pay Rs 25,000 over five years (going for the exchange programme could jack that up by another Rs 4,000 to Rs 5,000 per month).

The class of 2010 at IIM-Indore consisted of 175 students. That number went up to 235 for the batch of 2011.
The class of 2012 is a record 450 students.
these numbers are just shocking.


unjustly said...

Actually the numbers are not shocking. If we are looking at the average EMI for the average student, we should also look at the average take home salaries for the said students. These numbers have risen steeply as well since you & I went to laketown!
Also, for many people with a little corporate experience, MBA remains the only route to change career paths.
No fan of the gold rush & the expectations myself, but these are the current realities.

csm said...

mohit - are both the ncreases in the same order of magnitude?
my senses indicate otherwise but your data will be more reliable.

the CTCs these days seem to be heavily padded compared to our times.

what is certainly the most jarring is the increase in intake.
even at 10% growth, no economy can absorb.

unjustly said...

1. The average CTC (as far as i remember) in 1998 was 3.5L; it is of the order of 8L now (as far as I know).
2. The placement levels at most top-level MBA programs are of the order of 120-150% for the last 3-4 years
3. We also need to consider the fact that a lot of enrollment is driven by the "expectation" of salaries, rather than "actual" salaries. This actually correlates with the (much-hyped) top-10% salaries offered.
4. The fees have also increase drastically because of the withdrawal of government subsidies over the years.
5. The profit-motive of leading IIMs has come to the fore increasingly as well. While some of us alumni have fought this privately, the institutes have chosen to ignore this & whitewash their fee increases through clever marketing efforts.