Dollar’s Strength to Enhance European MBA Programs’ Appeal?

After it transpired that the cost of an MBA in the US was set to rise higher than the rate of inflation at many of the country’s leading business schools, prospective students in the US might have been forgiven for widening their consideration to encompass European MBA programs.

Those in the US might now find further reason to look at MBA programs on offer in Europe, after a report in Fortune highlighted how the US dollar’s gains over the euro in the past year effectively makes Europe’s MBA programs - or anything else for that matter - 21% cheaper when converting from US dollars.

From a high of one euro equating to US$1.4 in May 2014, it is now just US$1.1, according to the report, which investigates whether European business schools might expect to see an upsurge in applications from US candidates as a result. However, one school – INSEAD - pointed out that because most applicants spend over a year deliberating over their choice of MBA, it could take a while before the dollar’s strength – if sustained – results in us seeing more US candidates heading across the Atlantic for their MBA.

Even so, the dollar’s rise on the euro will only make a difference to the cost, in US applicants’ eyes, of MBA programs based in the 19 member states of the eurozone. This includes France, Germany, Spain and the Netherlands but neither the UK nor Switzerland - to look at the most popular European MBA study destinations among international applicants, according to annual research from QS.

Indeed, this research holds the UK up as Europe’s most popular MBA study destination, second only to the US in its worldwide appeal. However, the dollar’s gain on the British pound in the last year is only half as pronounced as its rise on the euro – something that amounts to a cost reduction on conversion of a little under 10% for US currency holders, according to the Fortune report. 

In any case, the dollar’s rise on both these currencies says as much about the current economic climate in Europe (and among members of the eurozone in particular) as it does about the recent progress made by the US in this respect. Applicants know that their choice of school and program must come with a close eye on the job opportunities they can expect to receive on graduation. Here again, applicant research shows that just over half of prospective students look to study in the country in which they wish to work after graduation. This leads us neatly on to the question of MBA ROI (return on investment).

A question of MBA ROI

While initial tuition costs can, understandably, be a strong point of contention among applicants, the all-important question of MBA ROI can only really be answered by looking at how an MBA program might impact on your career post-graduation.

After all, a cheaper program can only bring quicker returns off the back of the direction your career takes once the degree is completed. This is as much the case for an individual whose MBA ROI focus falls on professional or personal benefits as it is for those whose primary concerns veer towards the financial payback one can expect to look forward to.

Personal and professional gains sought can vary quite considerably between individuals and how they plan to use the qualification. But, for financial gains – both immediate and in the long run – QS’s Intelligence Unit drew up a detailed analysis of MBA ROI for anyone interested in studying at a top European school, regardless of whether or not you happen to be a US applicant looking to cash in on a strengthened dollar.