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MBAs lose allure amid financial crisis -

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MBAs lose allure amid financial crisis

Sue Lannin reported this story on Monday, August 3, 2009 12:18:00

ELEANOR HALL: There was a time when having an MBA made you a god of the financial universe. But the
global financial crisis has dealt the degree a serious blow and having a master of business
administration is no longer the guarantee of worldly success it once was as finance reporter, Sue
Lannin, reports.

SUE LANNIN: The global financial crisis struck at the heart of the financial world including for
the cream of the crop - people with MBAs.

Australia's top MBA college Melbourne Business School says fewer than half of its students who
graduated in May have found jobs. Acting dean Jenny George says students are having to look for
work in new areas.

JENNY GEORGE: We usually measure at two points. We measure how many people have an offer when they
graduate and then the next point at which we measure is three months after that.

So we know that roughly between 40 and 45 per cent had a job offer at graduation and we will know
in about three or four weeks time how many have a job within three months after graduation.

SUE LANNIN: And do you put it simply down to the global financial crisis?

JENNY GEORGE: Yes I do. Everyone is finding it difficult and a lot of the companies that normally
hire MBA graduates directly out of their degrees are exactly those companies that are feeling the
effects of the financial crisis.

Even though we are not seeing it quite so severely in Australia, the kind of companies who would
normally hire our students are global companies and so they are having to be very careful about
hiring even in markets like Australia where the financial crisis hasn't been quite so severe.

SUE LANNIN: There are more than 100 master of business administration programs in Australia and
while it may seem a bad time to launch a new course, the University of Sydney has just launched a
new MBA program. It will take in 15 to 20 students and charge around $100,000 - at least double
many other courses.

Professor Chris Styles is the head of the program. He says its targeted at those already working in
leadership positions and includes study trips overseas.

CHRIS STYLES: We think it is the right time to launch this type of program. We have been working on
this for the last three years in fact on how we would approach the MBA market and we have been
trying to get a lot of feedback from the business community about what is needed, what the
opportunities are and in fact a lot of the things that have been revealed or accelerated if you
like over the last six to 12 months, we were hearing a few years ago.

So we've really been able to build a lot of these new ideas into this new program.

SUE LANNIN: Do you think that in this climate it is going to be hard attracting students?

CHRIS STYLES: I think we have to be careful about what we are compare this to. This is not your
standard traditional two-year full-time MBA targeting at people who are say 26, 27 years old.

This is a product which is aimed at those with around about 10 years plus experience, they are
executives, managers, senior managers in companies and this is part of their accelerated leadership
development program. This is not about taking a large number of students into a program and churn
them out the other end.

SUE LANNIN: Sydney-based consultant, Michelle Lawler, got an MBA in 2000. She says she has no
regrets but in the current employment market it's not always an advantage.

MICHELLE LAWLER: It can sometimes be a double-edged sword. It depends on the level of job that you
might be looking at. Sometimes I have actually considered whether in fact it is a hindrance. People
will look at having an MBA as being overqualified for particular jobs.

SUE LANNIN: The University of Queensland's business school says it doesn't anticipate problems
placing students this year. Cristian Urrutia graduated from the University's MBA program in 2005
and is doing consultancy work after a stint at accountancy firm, PricewaterhouseCoopers.

CRISTIAN URRUTIA: The crisis that we are going through at the moment is something that is going to
pass. The MBA is something that is going to stay with you through all your career, throughout your
life.

ELEANOR HALL: Business consultant and MBA graduate Cristian Urrutia ending that report by Sue
Lannin.