The Impact of Economic Conditions on MBA Placements in 2024

It is mid-April, and we are racing towards May, and more than 95% of the best MBA institutes as per the NIRF Rankings have yet to publish their official placement reports for the year 2024. Out of the ones whose data is available, only a few of them have published detailed placement reports. Rest have just concluded and declared to the media about the conclusion of their placement season. The MBA Colleges or B-Schools that have declared some statistics related to placements for the batch of 2022-24 are IIM Indore, IIM Rohtak, IIM Bodh Gaya, IIM Visakhapatnam, SPJIMR, XLRI and SIBM Pune. 

This phenomenon has never happened and is surprising to current and future CAT aspirants. Even prestigious MBA institutes like BLACKI IIMs, XLRI, SP Jain, and others are moving towards finalizing their admissions for the batch of 2024–26 without officially publishing their annual consolidated reports. Those who have declared their data have seen a dip in their overall performance. Let’s have a look at some of the important B-schools in the country that have reported their placement statistics to the media. (See Figure - 1)

 Figure - 1

Even one of the Holy Trinity, IIM Bangalore saw a dip in their Median Package. (See Figure - 2)

Figure - 2

If you look at IIM Rohtak, it is probably the only IIM as of now that has shown a rise in the average package by almost 3%. Even non-IIMs like SIBM Pune have shown a significant rise in their Average Package. 

The average package of SIBM Pune jumped by more than 5%, which at first glance feels like a huge achievement considering the recent market conditions in the country. But, while institutes like top IIMs are showing a decline in their final placements, other MBA B-Schools like IIM Rohtak and SIBM Pune are displaying a slight rise in their average package. What could be the reason behind these jumps?

To understand this, we have to look at the data with a more statistical approach. Let’s view the average and median packages of these institutes together. (See Figure - 3 & 4)

Figure - 3

Figure - 4

Median Package provides us with the insight that the number of students above that package is equal to the number of students below that package, which means that, as in the case of IIM Rohtak, the number of students who secured a package compensation of above 17 LPA is 160, while the number of students who secured a package compensation of below 17 LPA is also 160. Now, if we look at the deviations of the average packages from the median packages of the two institutes over the years, we can observe that the deviations have increased. A higher deviation means that the data is skewed and asymmetrically distributed. This means that the average has risen by a higher number of students receiving the highest or close to the highest packages. These deviations deteriorate the actual representation of the data and hence should be trusted, backed by proper research.

But why are we witnessing a decline in placements at premiere B-schools? First and foremost, the current economic conditions of the country. There can be many reasons that can be attributed to the economic slowdown of the country, and it is almost impossible to pinpoint one reason. The major reasons can be the global slowdown, recession in most countries, including the US, the upcoming central elections, a reduction in IT spending, low foreign investment, the Russia-Ukraine war, and more. 

Also, when COVID-19 ended in 2022, many mass recruiters and top IT companies saw a major rise in their revenue. As a result, over three years before 2024, top institutes like IIMs and IITs posted phenomenal placement statistics, and rightfully so. This is evident when we look at companies like PayTM, Byju, and many others that reached their peak valuations during these years only.

But when the country witnessed an economic slowdown, we saw mass layoffs by the same companies only. The point is that, at the end of the day, the CEOs have to post profits in their yearly reports. As a result, when 2023–24 hit, to post year-on-year profits, the brands started to lay off employees and showed reluctance in hiring and offering packages that were previously offered. As a result, we witnessed a decline in average packages and institutes taking more time to place the entire batch. This trend is common for all management and technology institutes alike. 

But at the end of the day, the top guns of the country will not go down that easily, and the country is expected to bounce back soon, once it does, the same will be reflected in the placement statistics of the upcoming batches. But is it the right decision to do an MBA or even start preparing for the CAT exam now? We will cover those questions in the upcoming articles.

(Please note that the above article is based on the data that has been released by the institutes until April 16, 2024. The article will be updated as and when the rest of the colleges declare their placement reports for 2024.)

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• SIMS Pune Placement 2024 Concluded, Highest Package at INR 23 LPA; Check Report Here
• IIM Visakhapatnam Placements 2024 Records 100% Placements, Highest Offer of INR 43.25 LPA; Check Placement Report Here

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