Tuesday, May 05, 2009

Fewer International MBA Students in Years Ahead?

A lot of the international students who graduated from business school this year and landed jobs with investment banks had their offers reneged when Congress passed a rule saying institutions that took bail-out money couldn’t hire foreign-born workers.

While at first glance you’re probably thinking that anything that discourages international students from competing for spots in top MBA programs is a good thing for U.S. students, there are other issues to consider, says Maury Hanigan, an MBA recruitment specialist and president of MBA Scouting Report, New York.

First, some facts about international students in MBA programs:
• They’re typically one-third of the class at top schools
• They typically pay full tuition
• They have higher GMAT scores, on average, than U.S. students.

“If international students can’t get jobs in banking, that will discourage them from applying,” Hanigan points out. Having fewer international students enroll could hurt business schools – think lower average GMAT scores and fewer full-tuition-paying students.

Less competition from international students is actually a mixed blessing for U.S. students, Hanigan says. It’s easier to get in when fewer students apply, and you’re less likely to be frustrated by study group members with limited language skills when more of your classmates are Americans.

But, you lose out by not having a global network and the diverse perspective international students create. “There can be big swings in classmates, curriculum and the networks you build,” she says. “And the job market will reflect itself the composition of your network. You could end up in a school with no internationals or 45 percent internationals.”

The Wall Street Journal argues that H-1B visa holders aren’t really a big factor on Wall Street anyway, saying:

"In fact, H-1B visa holders have been a negligible percentage of financial industry hires in recent years. In 2007, for instance, Citigroup hired 185 H-1B workers, which represented .04% of its 387,000 employees. Bank of America hired 66 H-1B workers, which represented .03% of its 210,000 employees."

That said, finance may be the latest industry where the federal government seeks to limit immigrant workers, but it might not be the last.

The two senators who created the TARP restrictions, Grassley and Durbin, have now introduced legislation that would force all U.S. employers to first try to hire a U.S. worker before they hired an H-1B visa holder.

As Infoworld.com reports, their proposal:

"...would also prohibit displacing U.S. workers with H-1B visa holders, ban 'H-1B-only' ads and prevent employers from hiring additional H-1B and L-1 visa holders if more than half of their employees rely on those visas. The L-1 visa is used by companies to transfer foreign employees. The measure also includes a provision to give the U.S. Department of Labor more latitude and authority to initiate investigations and conduct random audits."

Regardless of what happens in Congress, if you’re shopping for an MBA program, the proportion of international students will remain an interesting difference to consider when comparing schools.

No comments: