Executive M.B.A. Grads Decide to Look Elsewhere

Corporations are using tuition reimbursement for E.M.B.A. programs as a cost effective-way to help employees transition to a new job.

In 2001, Charles Bryant, 43, began an executive M.B.A. program at Southern Methodist University’s Cox School of Business and his employer, E-commerce-applications company BroadVision Inc., agreed to chip in part of the $63,000 tab.

But the Redwood City, Calif.-based employer laid off Mr. Bryant from his job as a client-relations manager in 2002, when he was halfway through his program. Still, a week later, BroadVision made a final $5,200 payment toward his tuition, and he finished the degree on his own in May 2003.

“My goal after I was laid off was just to finish the degree and worry about finding a new opportunity later,” he says. “It was what I wanted, and I believe having it helped me get my new job.” He’s now a client executive in the Dallas area for Totality Corp., a San Francisco application and infrastructure-management firm.

Means to a Job Change

Traditionally, employers have paid tuitions for select employees to earn executive M.B.A.s (E.M.B.A.s) with the expectation that these executives will stick around afterward and put the company’s investment to use. But layoffs amid a down economy, plus a diminished bond between employers and employees, are resulting in more executives job-hopping as they earn the degrees — creating, in a sense, a career-transition plan for themselves.

In 2003, for instance, a quarter of E.M.B.A. graduates were involved in a job hunt, compared to 17% in 2002, according to a survey by the Graduate Management Admission Council (GMAC), provider of the Graduate Management Admission Test (GMAT), based in McLean, Va.

E.M.B.A.s were originally designed so that groups of seasoned managers — most are in their late 30s with about 10 years’ experience — can keep working while pursuing B-school studies together on weekends. Executives had to be sponsored by their companies to attend, and students weren’t allowed to pay for the program independently. Most then continued on with their employers after graduation.

Now, many executives receive only partial employer funding or foot the whole bill themselves. GMAC researchers at first speculated that having more younger E.M.B.A. participants was the primary reason a higher percentage of graduates were job hunting in 2003. But their survey results showed the opposite: 62% of the 2003 survey respondents were 35 years or older, compared to 54% in 2002.

This led GMAC researchers to speculate whether some E.M.B.A. participants had topped out at their companies and were being eased out the door. For these executives, receiving full or partial tuition payments to complete an E.M.B.A. may be a compassionate and cost-effective way for employers to help them transition to a new job.

“It’s possibly a way to provide significant support to people who are separating from a company,” says Daphne Atkinson, GMAC vice president of industry relations. “To reposition them with new skill sets, they can be sponsored [to earn degrees] with the expectation that they would not return to their companies.”

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