Business degrees are very popular and thought to be useful for the versatility and number of opportunities they offer. Despite these substantial advantages, the current labor market is not in favor of business degrees as winning investments.
Business Degree Traits
Network and social skills pave the way for good impressions on employers, clients and customers and coworkers. Public speaking and persuasion skills are expected of business degree holders. Business is becoming more international in scope. The degree-holder who can succeed with a diverse team has a large advantage. Related cultural insights such as language skills or overseas experience also help. Business is ultimately about making money. As such, a grasp of investment concepts is invaluable. Profits, losses and risks are the bread-and-butter of business operations.
Those with an understanding of risk and uncertainty can lean towards business operations in an insurance environment and work closely with actuaries to assess risks and benefits of coverage plans and decisions. General managers and supervisors focus on the interface between people and technical skills. Typically, business majors with expertise in a particular line of work, such as industry, would do well to pursue a supervisory or middle-management position at a factory or processing facility. Economists serve as advisors and consultants in various corporate and government positions. Their job is to integrate knowledge of business dynamics with the larger economic climate to produce accurate economic forecasts and analytical reports. A financial consultant or financial advisor works with clients to help them to succeed in their financial goals, taking into account clients’ limitations, strengths, habits and perspectives on money.
Business Degree Weaknesses
Business degrees signal versatility. This seems like an advantage until “versatility” bumps up against “specialized skill.” Currently, several issues with business degrees limit its utility as an investment. Most importantly, there are simply too many business degrees granted to students. This is not to say that the degrees teach little, but just that relative to employer demand, the value of an individual business degree is pretty low. This results in lower pay and more intense competition among business-major applications. CBS News reported that the oversupply trend continues through graduate school. An MBA is often not worth the investment because of too many existing MBAs who can’t find enough fitting job openings. Additionally, “who you know” rivals “what you know” more than in almost any other field. The school location, classmate/alumni network and school “brand name” are very important to success. High achievement in a socially marginal school will be have a marginal payoff.
Overall, a business degree is not a good investment. Its much-vaunted versatility masks a lack of detailed operational knowledge. Hence, the appeal to employers is less than one might think. Critically, until/unless the labor market absorbs existing business-degree holders, a business major will, on average, remain a losing investment. Of course, good connections or networking developed during study could make a huge difference. But on its merits, a business degree is not a good investment.