MBA Programs Adding STEM Degrees to Attract Overseas Students

Summary

---

Episode Overview

Podcast: WSJ Your Money Briefing
Episode Title: MBA Programs Adding STEM Degrees to Attract Overseas Students
Date: February 6, 2020
Host: J.R. Whalen
Featured Guest: Patrick Thomas, Wall Street Journal reporter

This episode explores how U.S. business schools are redesigning their MBA programs to include STEM (Science, Technology, Engineering, and Math) concentrations, primarily to attract international students. The discussion covers the decline in international applications, the impact of immigration policies, the practical benefits of STEM-designated MBAs, and the evolving skills employers are demanding from MBA graduates.

---

Key Discussion Points and Insights

Decline in International MBA Applications

• International Applications Drop (01:39)

  • Applications to U.S. MBA programs have fallen roughly 14% in the past year.
  • Over five years, even elite schools like Harvard and Stanford are experiencing declines, attributed mainly to fewer international applicants.
  • Reasons include "global tensions, tensions with China, changes to immigration policy" (01:00-01:40).

• Importance of International Students (02:09)

  • "International applicants made up about 40% of all applications to American business schools. It's a huge market for these schools. It's very important to them." — Patrick Thomas [02:09].

The STEM Designation Advantage

• Why STEM Is So Appealing (02:32-03:06)

  • STEM-designated degrees allow international graduates to stay in the U.S. for three years after graduation (versus one year for non-STEM degrees).
  • This extended time frame makes graduates more attractive hires for employers needing talent in a tight labor market.
  • Companies are more willing to hire international graduates if they know the recruit can stay longer: "[with a STEM degree] you get an extra two years, so at least three years, which makes it much more appealing... to employers who hire them." — Patrick Thomas [02:32]

• Employer Demand for STEM Skills (03:12)

  • "Employers want MBA grads to have more of those data skills, the quant skills, so to speak... it's beneficial for not just international students, but domestic students as well, to have that STEM title next to your name." — Patrick Thomas [03:12]

Designating Business School Programs as STEM

• The Role of Homeland Security (03:34-04:03)
  • The Department of Homeland Security controls STEM designation, setting requirements for qualifying fields such as business analytics and management science.
  • Patrick shares: "They mainly handle it because it's more of an immigration issue than a Department of Education issue... which I think a lot of people are surprised by." — Patrick Thomas [03:34]

What Skills Are Employers Really Looking For?

• Data and Leadership Skills (04:08-04:48)

  • Employers are searching for MBAs proficient in "sifting through data," managing large datasets, and using tools like Excel.
  • Desired skillset combines technical (not necessarily programming expertise, but "know how it works") and leadership abilities.
  • "[Employers want] people who know how that works and how to make a pivot table in Excel." — Patrick Thomas [04:08]

• Crunching the Numbers (04:48)

  • "How to crunch data, that's a big thing for employers now in the world we live in. And that's what they're looking for in MBA programs. And if you're STEM designated, that shows employers that, hey, we're teaching... our students how to do this." — Patrick Thomas [04:48]

---

Notable Quotes & Memorable Moments

• On the international appeal of STEM MBAs:
  "If you have a STEM designation, you are less likely to see a decline in applications from international students compared to those without a STEM designation." — Patrick Thomas [02:19]

• On the landscape for business schools:
  "International applicants made up about 40% of all applications to American business schools." — Patrick Thomas [02:09]

• On the skills MBA recruiters value most:
  "Employers are increasingly looking for those, a combination of skills of being able to, not necessarily be a data scientist, but being able to run a team of data scientists who, you know, run those Python R all these coding programs." — Patrick Thomas [04:14]

---

Timestamps of Key Segments

• 01:39: International applications to U.S. MBA programs have fallen 14%
• 02:09: Importance of international students (40% of applicants)
• 02:32: Impact of STEM degrees on post-graduation work prospects
• 03:12: Demand from employers for STEM skills in MBA graduates
• 03:34: Department of Homeland Security’s role in STEM designation
• 04:08: Specific skills employers are looking for (data, leadership)
• 04:48: Emphasis on data "crunching" as a valued skill

---

Conclusion

This episode clearly lays out the strategic adaptation by U.S. business schools to offer STEM MBAs, primarily to remain appealing to international students restricted by tighter immigration policies. The practical benefits—greater employability and longer post-graduation work eligibility—are valued by both students and employers. Meanwhile, the content of MBA programs is evolving to reflect the labor market's increasing prioritization of data and analytical skills, alongside traditional management training.

---

Transcript

[Charles Schwab Host]

This episode is brought to you by Charles Schwab. Decisions made in Washington can affect your portfolio every day. Washington Wise from Charles Schwab is an original podcast that unpacks the stories making news in Washington. [e-mail] Washingtonwise.

[J.R. Whalen]

Here's your Money briefing. I'm J.R. whalen at the Wall Street Journal in New York. Changes to US Immigration policies have made it harder for universities and to attract international students. Well, now some business schools are trying to boost their international enrollment by offering programs focused on science, technology, engineering and math, also known as stem.

[Patrick Thomas]

Applications overall to MBA programs over the last five years have been falling. But the most elite colleges, the Harvards, the Stanfords of the world, they mostly blame that on a drop in international applications because of global tensions, tensions with China, changes to immigration policy for a variety of reasons, but that's been a big problem for these universities.

[J.R. Whalen]

That's Wall Street Journal reporter Patrick Thomas. He'll explain the appeal of MBAs with a stem focus and the skills that employers want to see in graduates of those programs. That's next. Business schools in the US Are adding programs in science, technology, engineering and math, or stem. It's part of an effort to attract overseas students who eventually want to work here. And Wall Street Journal reporter Patrick Thomas is here to discuss. So, Patrick, to what degree have international student applications to US universities declined?

[Patrick Thomas]

Well, applications have fallen about 14% since last year. Applications overall to MBA programs over the last five years have been falling. But the most elite colleges, the Harvards, the Stanfords of the world, they mostly blame that on a drop in international applications because of a global tensions, tensions with China, changes to immigration policy for a variety of reasons. But that's been a big problem for these universities.

[J.R. Whalen]

And international students are very important to the business schools.

[Patrick Thomas]

International applicants made up about 40% of all applications to American business schools. It's a huge market for these schools. It's very important to them. And if you have a STEM designation, you are less likely to see a decline in applications from international students compared to those without a STEM designation.

[J.R. Whalen]

Why are STEM related programs so appealing to international students?

[Patrick Thomas]

Well, the STEM degree gives international students the opportunity to have two extra years in the U.S. normally, if an international student graduates from a U.S. school, they get a year in a federal program, they get to stay in the US For a year. With a STEM degree, you get an extra two years, so at least three years, which makes it much more appealing to the student and to employers who hire them. So there's been a number of employers who are less likely to hire an international student if they're only here for one year, but if they've got three years, they might be more likely to hire you.

[J.R. Whalen]

And the companies are just as eager to hire international students with a STEM degree because of the tight labor market.

[Patrick Thomas]

That's true. There's also been a push. Overall, employers want MBA grads to have more of those data skills, the quant skills, so to speak. So that also is beneficial for not just international students, but domestic students as well, to have that STEM title next to your name.

[J.R. Whalen]

And for the business schools, it's important for their programs to be designated as STEM related.

[Patrick Thomas]

The Department of Homeland Security kind of handles the STEM designation. They outline certain fields that the schools have to abide by. They add programs in business. Analytics, management science are some of the fields that the Department of Homeland Security highlights. And they mainly handle it because it's more of an immigration issue than a Department of Education issue. In some ways, it's pretty complex and gets in the weeds, but the Department of Homeland Security handles it, which I think a lot of people are surprised by.

[J.R. Whalen]

So what kinds of skills are employers looking for in students who graduate from STEM programs?

[Patrick Thomas]

Well, employers are increasingly looking for students that are able to look at big data sets and combine that skills to be able to sift through data and look at large Excel sheets of numbers and be able to boil it down along with the leadership skills that you learn in a traditional MBA program. So employers are increasingly looking for those, a combination of skills of being able to, not necessarily be a data scientist, but being able to run a team of data scientists who, you know, run those Python r all these coding programs. Employers want people who know how that works and how to make a pivot table in Excel.

[J.R. Whalen]

How to crunch data?

[Patrick Thomas]

Actually, yes. How to crunch data, that's a big thing for employers now in the world we live in. And that's what they're looking for in MBA programs. And if you're STEM designated, that shows employers that, hey, we're teaching these student. We're teaching our students how to do this.

[J.R. Whalen]

All right. That's Wall Street Journal reporter Patrick Thomas with us. Patrick, thanks for coming on the show.

[Patrick Thomas]

Thanks for having me.

[J.R. Whalen]

And that's your money briefing. I'm JR Whalen in New York for the Wall Street Journal.

[Charles Schwab Host]

This episode is brought to you by Charles Schwab. Decisions made in Washington can affect your portfolio every day. But what policy changes should investors be watching? Washington Wise is an original podcast from Charles Schwab that unpacks the stories making news in Washington right now and how they may affect your finances and portfolio. [e-mail] WashingtonWise.