Up until March this year, 2020 was expected to be another average season for CAT. The number of CAT aspirants has ranged between Rs 2 and Rs 2.25 lakh for the past decade or so. There are multiple reasons for this limited interest in MBA education. In the past 15 years the fees of all colleges has gone up dramatically, but the average salaries have been more or less stagnant. The start-up boom in the country had also shifted the focus to entrepreneurship and there were a lot of lucrative opportunities for fresh graduates.
This will likely change now. COVID-19 has made a considerable dent in the health of global economy, and the complete lockdown made it worse for India. The early reports of job losses in different sectors have begun to pour in. The numbers are disturbing but what is worrisome is the fact that this will get accelerated even though economy is slowly coming to life.
MBA or Job?
So, the decision between scouting for a job or going for higher education is a critical one at this stage. This year’s CAT aspirants may be worried about placements at MBA colleges. Hence, they may want to defer their plans to a time when the economy is in a better shape to reward them with gainful employment opportunities. While this may seem logical on the face of it, there are a few points which students need to review to arrive at a rational decision:
- The job market is hurting right now and hence the quality and quantity of employment opportunities is poor. Even the fast growing start-ups in India have had to lay off executives.
- While IIMs and other top MBA colleges do give value to work experience, the quality of job profile carries the most weight. Just having 2-4 years of average work experience in a company has little value add.
- COVID-19 has disrupted the economy, but it is not because of a demand-supply side economic cycle. The damage was swift and deep, but the recovery is also expected to be at the same pace. So, it is likely that the economy will get back to its feet quickly provided the virus doesn’t play out in multiple cycles.
Empirical evidence points to Swift Economic Revival
The experience of 2007 financial crisis also played out similarly wherein within two years of the meltdown, the economies around the world were on hiring spree to fuel the growth engine. A similar story is expected this time around with even quicker turnaround.
In a nutshell, this may actually be the best time to appear for CAT. This batch will start their education in 2021 and by the time they pass out in 2023, the economic engine should be revved up full scale. This would mean excellent job profiles across sectors.
In addition to the academic knowledge, this time the students will most likely get exposure to very interesting subjects such as disaster management, business continuity plans, remote work challenges & solutions among other real life industry concerns. In fact some of the sectors may see a shake-up such as tourism and hospitality, thereby creating demand for fresh perspective and entrepreneurial vision. MBA institutes are the best place to gather knowledge and lead the change in industry. The post Covid economies around the world could be quite different to what we have today and India has a unique positioning to gain maximum ground.
One size does not fit all
Having said that, there is never a “one size fit all” approach. The opportunity cost of doing an MBA varies at individual level and hence the decision needs independent analysis. Each individual needs to gather and analyse relevant intelligence as applicable to them to arrive at an informed decision. As is widely touted, there is no such thing as a wrong decision but one’s ability to commit and extract the best outcome.
CAT 2020 Preparation
If you are going for it, my advice is to start your preparation now. It is time to ignore all the negative news regarding exam dates, economy, covid etc. Your only goal should be to put in smart effort to crack CAT 2020.
Don’t leave it to the last minute while your competition is burning the midnight oil.
— The writer is Vice-President at Hitbullseye.com
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