As reported here this morning, Chicago Booth has claimed its first-ever No. 1 rank in the U.S. News & World Report MBA Ranking, released today. It tied for first with Harvard Business School (HBS), which has held or shared the No. 1 spot for four years running.
The University of Pennsylvania’s Wharton School, which tied HBS for first last year, slipped to third. Stanford Graduate School of Business, meanwhile, remained constant in fourth place for a second year. Last year, the California school was in a three-way tie for the No. 4 spot with MIT Sloan and Kellogg, but this year, those schools slipped to fifth and sixth respectively.
In case you missed our earlier piece, here’s a quick rundown of this year’s top 10, in order of their 2019 rank (2018 rank in parentheses):
1 Harvard Business School (1, tie)
1 University of Chicago Booth School of Business (3)
3 University of Pennsylvania’s Wharton School (1, tie)
4 Stanford Graduate School of Business (4, tie)
5 MIT Sloan School of Management (4, tie)
6 Northwestern’s Kellogg School of Management (4, tie)
7 UC Berkeley Haas School of Business (7)
7 University of Michigan’s Ross School of Business (11)
9 Columbia Business School (9)
10 Dartmouth’s Tuck School of Business (8)
Of course, Chicago Booth is not the only school celebrating today. The University of Michigan’s Ross School of Business did more than simply crack the top 10 for the first time since 2005. It tied for seventh with UC Berkeley’s Haas School. In so doing, it sidled past Columbia and displaced Dartmouth’s Tuck School to 10th place. And it knocked Yale SOM out of the top 10 altogether.
Once again, Clear Admit has sifted through the data to pull out the revelations in the 2019 U.S. News MBA Ranking that we believe most warrant closer inspection. Enjoy!
8 Key Takeaways from the 2019 U.S. News MBA Ranking
- Chicago Booth Is the Big Winner—But Not All Applicants May See It That Way
Chicago Booth made a big move—one that will certainly give them a bump—but applicant behavior suggests that the likes of HBS, Stanford, and Wharton are still ranked more highly in the marketplace. “In other words, we don’t expect that Chicago will suddenly be beating out the likes of Stanford and Wharton where applicant choice is concerned,” says Clear Admit Co-Founder Graham Richmond. “And anyone who follows our DecisionWire tool—where applicants share where they decide to enroll based on available options—should be able to see this in action.”
- Students Pursuing Entrepreneurial Ventures May Have Hurt Stanford in 2019 Rankings
Stanford’s slide to fourth—where it remains for a second year—could have to do with the fact that more of that school’s students choose to pursue entrepreneurial ventures straight out of school or head off to work with tech startups. That’s because U.S. News’ methodology* relies on “grades” from corporate recruiters and other employment stats that favor larger firms over startups or entrepreneurial pursuits. Therefore, schools with large numbers of students going into tech startups or entrepreneurship are essentially penalized. And of the Stanford MBA Class of 2017, 16 percent planned to launch their own ventures upon graduation. This could impact Stanford’s recruiter score—4.4 out of a possible 5—which came in just behind the 4.5 score claimed by both Booth and HBS. At the same time, Stanford had a higher average GMAT score (737) and a lower acceptance rate (5.7 percent) than any other school in the ranking, including the three schools ranked higher. Stanford also boasted one of the highest average starting salary packages, $159,440, second only to third-ranked Wharton, at $159,815.
- The M7 Is Largely Undisturbed
Despite some shakeup at the top this year, the 2019 U.S. News MBA Ranking does keep the so-called “Magnificent 7,” or “M7,” largely united. Strong performances by Haas and Ross knocked Columbia down to ninth, separating it from its M7 brethren, but otherwise the group of seven appears just as you would expect it, at the very top.As for why Columbia, out of all M7 schools, seems to be having to fight for its place with the others, this could have to do with the rising cost of living in New York and the declining interest among applicants in the financial sector—though that’s just conjecture. CBS is also one of the few leading schools that has yet to spruce up its facilities in a major way. Construction on an impressive new Manhattanville campus is underway, but the school has acknowledged that it is nowhere close to meeting its original projected 2018 completion date.
- No Real Surprises in Either the Top 16 or Top 20
The schools included in this part of the ranking are what most would expect to see and are consistent with what we see in the marketplace via DecisionWire data.”U.S. News seems to have the right schools included in the top 16 and the top 20 (well, 21), too,” says Clear Admit Consultant Alex Brown. “But some of the order of the Top 16 just doesn’t reflect market reality—the reality we see on DecisionWire,” he continued. “Stanford is comparable to Harvard, it’s not No. 4. Ross is a great program, but I don’t think it belongs at No. 7. The top 7 is traditionally occupied by the M7 schools.”
- The Rankings Are Very Close—Begging the Question of Whether Ordinal Rankings Are Best?
With 14 ties in the top 50 schools alone—including multiple three- and four-way ties—it is quite evident that the rankings are very close, with very little distinction between closely ranked schools on the list.“Really, takeaways 3, 4, and 5 on this list are tied to the fact that ordinal rankings feel flawed,” says Richmond. “A market-driven ranking—based on applicant behavior/applicant choice of schools when selecting from multiple offers—would demonstrate that the schools actually cluster quite closely…and that these clusters don’t change as dramatically from year to year.”
- There Are Reasons Ross Is Rockin’ the Top 10
Though some may quibble that a No. 7 spot is too high, ample evidence points to how and why Ross broke into the top 10 for the first time in more than a dozen years. For starters, Ross is enjoying its second year under a vibrant professor-turned-dean, Scott DeRue, and it’s been working its way up the U.S. News rankings under his leadership. Last year it advanced from 12th to 11th, and this year’s 7th-place finish certainly captured plenty of attention. But along the way, increasing admissions stats have only helped improve the school’s standing. The average GMAT score for the most recent class jumped eight points over the year before, to 716, and GPA eeked up one tenth of a point as well, to 3.5.Application volume has also been on the upswing for four years running. The number of applications for the Class of 2019 was a record-breaking 3,485, with acceptances offered to just 25.3 percent. This increasing selectivity is another metric U.S. News looks upon favorably. And there have also been strong gains in terms of post-MBA employment. The median starting salary for the most recent graduating class was $123,000, up $3,000 from the year before.
- Yale SOM Seems to Be Penalized for Sending Grads into Non-Profit Jobs
Yale slipped out of the top 10 this year to No. 11, which has some members of our team coming to its defense. “I would say that there is an issue with using average starting salary for a school like Yale that sends a good number of folks into non-profit,” notes Richmond. “I’d also point out that the average salary figure may not be too relevant to someone looking at Yale SOM for a career in finance or consulting, where the school likely sees averages that are very competitive with the very best programs.”Clear Admit’s Alex Brown concurs. ‘It appears that Yale is penalized, under the current methodology, for sending more people to careers in the social sector, which don’t offer the same remuneration as banking and consulting,” Brown says. “It might be a smarter strategy for U.S. News to look at average salaries within sectors, rather than across all sectors,” he suggested, conveying an actual comment made by someone on LiveWire this morning.
- Foster and Rice Are Likely Benefitting from Industry-Specific Geographies
Outside the top 20, there were plenty of movers and shakers as well, including the University of Washington’s Foster School of Business and Rice University’s Jones Graduate School of Business. Foster narrowly missed the top 20, coming in at 22nd because the two schools before it tied for 20th. And Rice Business, as the school likes to be called, bounced back from a 29th place showing last year to 23rd this year. These strong finishes were helped in great part by the respective 85.2 and 83 percent of their graduates who were employed by graduation, which in turn was helped by the strength of the tech sector in Seattle and both the tech and energy sectors in Texas.
In closing, Richmond offered one more bit of insight. “I would also strongly encourage folks to listen our latest Clear Admit MBA Admissions podcast episode where we analyze the purpose of rankings and offer a slew of advice regarding how one should factor rankings into the admissions process,” he says. “This includes specific tips on interpreting year-to-year fluctuations in ranking and how to best understand why these fluctuations occur. (Hint: it has something to do with selling magazines and generating web traffic.)”
So, there you have it. The rankings are out from U.S. News, and our Clear Admit experts have been kind enough to help make sense of them. As always, those of us here at Clear Admit encourage prospective applicants to use rankings as just one of many resources in your research to determine the best business school for you. Good luck!
*A quick reminder about the methodology U.S. News uses to compile its annual ranking of best U.S. business schools: Largely unchanged in recent years, its rankings are based on a weighted average of three groups of criteria. Quality assessment, weighted at 0.40, includes a combination of peer and recruiter assessments. Placement success, weighted at 0.35, takes into account mean starting salary and bonus and employment rates for full-time MBA graduates. Lastly, student selectivity, weighted at 0.25, looks at measures like average GMAT/GRE score and GPA and acceptance rate.
To compile this year’s rankings, U.S. News surveyed all 480 MBA programs accredited by the Association to Advance Collegiate Schools of Business International in fall 2017 and early 2018. Of the 387 who responded, 127 provided enough required data to be included in the ranking.