Health-Care MBAs See Brighter Future
Dan Macsai | BusinessWeek
Industry in Flux
Yet top business school students have typically flocked en masse to other industries. (In 2008, only 2% of Harvard Business School grads went into health-related industries.) Lured by “the megabucks of Wall Street,” they ignored health-care management to pursue finance and consulting, says David Dranove, a professor of health-industry management at Northwestern’s Kellogg School of Management. As a result, he says, health-care providers recruited most of their talent from schools of public health.
Indeed demand for health-care MBAs outstrips supply, according to a report from the W.P. Carey School of Management at Arizona State University. As of earlier this year ASU said there were about 75 accredited programs in health management; virtually all of ASU health-care grads got jobs within three months of graduation.
In recent months, however, Northwestern’s Dranove has seen “a renewed enthusiasm” for health-care management. He says the number of Kellogg students interviewing for positions in the health-care industry has more than doubled since 2005. And health-care providers have embraced the attention: They’re coming to campus for the school’s first-ever Provider Day, during which they’ll discuss career growth opportunities.
“Students used to say: ‘I want to work for a big, prestigious corporation, not a hospital,’” says Dranove. “Now, they’re starting to realize those two are one and the same.”
A Stable Choice
Of course, Wall Street’s downward spiral (BusinessWeek.com, 12/1/08)—and the resulting stream of corporate layoffs (BusinessWeek.com, 11/27/08)—likely hastened this change of heart. During times of economic turmoil, the health-care industry tends to thrive: It was one of the few fields to expand during the dot-com bust.
“There’s not a lot of swing in health care,” says Kristi Raube, the executive director of the University of California at Berkeley’s graduate program in health management at the Haas School of Business . “It’s like a steady growth engine.”
For business school students seeking job security, pursuing health-care management is “one of the most stable” career options, because people will always need care, says Mecklenburg. And right now, the industry is poised to expand: According to the Health & Human Services Dept., the health share of the GDP is expected to reach 19.5% by 2017, up 4.3% from its current share.
But as Inauguration Day looms, so do federal budget cuts. If they target Medicare and Medicaid—which comprise roughly 60% of the average hospital revenue base—health-care providers could be forced to downsize just as investment banks and automakers have, says Goldstein. “No industry is [recession-proof],” she says.