While American business school students worry about job offers being yanked (BusinessWeek.com, 4/3/08) and salaries and starting bonuses shrinking, their counterparts at top Indian business schools are having what looks to be their best recruiting year ever, according to a report.
The job placement figures this year at 20 of India's top management schools—including six Indian Institute of Management campuses (IIMs)—"paints a rosy picture of job prospects for top management graduates," according to the 2008 MBA Placement Report released Apr. 7 by MBA Universe, an India-based Web site about business schools.
A. Kumar, the site's editor, says the concerns over slowing MBA hiring in the U.S. aren't being felt in India. "There are absolutely no concerns over recession or slowdown," he said in an e-mail. "In fact, as our report says, even the international recruiters have been positive in their hiring."
Indian B-School graduates are commanding record salaries, up 20% to 22% from last year, and are being heavily recruited by major corporations, the report said. For example, at the Indian Institute of Management in Ahmedabad, the average domestic salary is up 30% this year, with the higher offers ranging from the equivalent of $125,000 to $175,000. In a few instances, offers as high as $280,000 to $360,000 were made to a select few. These offers included pay packages, signing bonuses, international relocation assistance, and vacation packages. "Clearly, the going was good for the privileged few who made it to the top B-schools," the report said.
More Experienced Grads
The recruiters are responding to an increasing need for high-quality managers to run the nation's growing businesses. India's burgeoning economy, fueled by a growing middle class, has made the MBA a more valuable commodity than ever before. The rise of top-tier management schools such as the IIMs is making it more appealing than ever for Indians to go to business school in their home country rather than pay for a brand-name American degree.
The effect is being especially felt at the top management schools. Salaries are higher this year partly because the work experience and qualifications of students at elite schools are improving. Nearly 60% of them have prior work experience, a big jump from three years ago when only 25% of graduates did, Kumar says. In addition, foreign companies—including Goldman Sachs (GS), McKinsey, and Merrill Lynch (MER), continue to push their recruitment drives. For example, at the IIM Bangalore campus, McKinsey and Boston Consulting Group each hired 15 graduates.
Fueling the recruiting drive is the addition of several high-profile international financial-services and consulting firms into the market. Many of the business schools reported several first-time companies on their campuses, including Indian recruiters seeking to shore up talent for their overseas operations. For example, ICICI Bank (IBN), one of India's leading banks, recently hired several students for positions in its Hong Kong office.
Still, not all students were interested in traditional jobs after graduating. Some decided to forgo offers at large companies to form their own ventures, part of an "emerging tribe of MBA entrepreneurs," the report said. At some schools, students decided to start independent Web ventures or join education nonprofits.
The reverberations from the likely U.S. recession appear to have had a minimal impact on Indian students' career decisions, the report noted. Nearly 40% of graduates are choosing jobs in financial services or the banking sector over marketing, operating, or general management positions.
"This February, given the backdrop of the subprime crisis and slowing down of the U.S. economy…placement teams and graduates were a worried lot," the report said. "However, top global finance firms kept their promise."