MBA demand, pay rising but enrolments still to catch up

Bonuses have also increased significantly, with the average in financial firms at just under 15,000, up from 10,500 in 2004.

The TopMBA International Recruitment Survey, which canvasses opinion from 500 international recruiters in 30 countries, shows an even greater recruitment demand for MBAs in the consulting sector (35%). General industry saw an increase of 17% and the technology sector 18%.

MBA demand is back to levels not seen since the height of the dotcom boom five years ago.

Applications to business schools, however, are lagging by up to two years. Nunzio Quacquarelli, author of the TopMBA report, says, "As employer demand increases, we may experience a wait of over a year before applications for MBA courses rise significantly in the UK to meet that demand."

The downturn in the economy from 2002 through 2003 saw a fall in applications of around 20%, and according to Quacquarelli, this has only just bottomed out. The good news is that candidates enrolling last year and this year will find themselves in great demand by employers.

"Stagnant economic conditions precipitated a fall in enrolments," Quacquarelli says. "The result for potential MBAs is less competition for places at the best schools and a virtual guarantee that those taking up places over the next twelve months will find themselves graduating into a very 'hot' job market."

Recruitment firm Robert Walters' managing director Andrew Chancellor agrees. "There is a big demand for MBA graduates currently," he says. "There is a shortage of almost every type of person in the market, and MBAs are definitely needed - provided they come from the very best schools, such as Insead, IMD in Geneva, Cranfield or London Business School."

And, he says, "The proliferation of other MBA schools means graduates from the established schools can be very confident of their employment prospects."

Chancellor adds that demand for MBAs in financial services will continue for at least eighteen months.