MBA Final Placement 2018 Analysis: A mixed season with little cheer at top B-schools

NEW DELHI, APRIL 25: The final placement season for 2018 MBA graduates has reflected a mixed trend with the majority of top B-schools recording less than 5 percent increase in average salary over the last year. A few renowned b-schools including IIM Rohtak and XIMB, XUB have also witnessed negative growth this year.

Though some B-schools defied the cold placement season with double-digit growth in an average annual package, a meagre rise in the average packages at high-ranked B-schools like IIM Kozhikode, JBIMS Mumbai and MDI Gurgaon signalled the tough industry sentiments on talent acquisition.

A downward trend is also not uncommon this year as reflected in the negative growth in annual packages at IIM Rohtak, IMI Delhi and a few others. The B-schools like NITIE and IRMA which offer specialised MBA programmes, however, saw a surge in the average package albeit with few exceptions.

Careers360 has analysed the placement trends of top 30 B-schools across India to find MBA placement trends of 2018. Before bringing the trend analysis, we bring to you the average salary of the current and preceding batches along with the percentage changes.

Average salary offered at top B-schools –2018 Vs 2017

Note: The order of the B-schools is based on the % increase in salary (Lowest to Highest)

Dip in Annual Package for IIM Rohtak, IIFT, XIMB

Although a majority of the B-schools listed above have seen a surge in the salary figures, some institutes have witnessed a downward trend, including a few IIMs. Institutes receiving a lower average salary in 2016-18 as compared to that of 2015-17 include IIM Rohtak and IMI Delhi with a de-growth of 4.87 percent and 2.16 percent respectively. The B-School which has undergone the biggest dip is XIM, Xavier University, Bhubaneswar with negative growth of 5.61 percent.

Justifying the reason for the decreasing average salary of IMI New Delhi, Prof. Pinaki Dasgupta, Professor (Marketing) & Dean, Corporate Relations & Placements, states, “The average CTC dropped by two percent to 12.23 LPA due to increase in batch size by almost 47 percent as compared to last year.”

While B-schools have defended the negative growth in average annual packages in multiple ways, the experts attribute this to a cautious approach on part of recruiters who are facing slow growth prospects. “When the industry sentiment is not vibrant and the recruitment norms are tighter, the fine balance between demand and supply is bound to be in favour of recruiters,” said a placement officer at a top B-school in Delhi-NCR.

Top B-schools witness less than five percent rise in average salary

Most of the top rung B-schools, which are the dream institutes for MBA aspirants, could not record more than five percent increase in terms of average salary. However, the salary figures are higher than Rs. 15 LPA in these B-schools.

IIM Kozhikode has recorded the lowest percentage of salary increase, which is 0.62, followed by JBIMS Mumbai at 0.78 percent. MDI Gurgaon, IMT Ghaziabad and XLRI Jamshedpur are private institutes which have witnessed an increase of 1.48 percent, 3.01 percent and 4.41 percent respectively in their annual packages.

Public institutes such as FMS Delhi, DMS of IITs and JBIMS Mumbai, best known for offering affordable, yet high-quality MBA programmes have observed a marginal increase in their salary packages which ranged between 2 to 3 percent. But, here is a caveat. Although the salary increase percentage is less, the average salary figures are higher than various B-schools recording around 10 percent increase in average salary. For instance, despite recording a growth of 14.75 percent, the average salary of VGSoM, IIT Kharagpur is Rs. 15.4 LPA, FMS Delhi’s average salary for 2018 batch is Rs. 21.1 LPA and that of JBIMS Mumbai is Rs. 18.91 LPA.

Experts, however, believe that the marginal increase in salary is because the industry is undergoing a rationalisation in various sectors. Dr. Dheeraj Sharma, IIM Rohtak Director said, “The average salary offered across the top B-schools is around Rs. 12 lakh to Rs. 18 lakh per annum. There has not been a major shift in terms of increase or decrease as I believe that the industry is undergoing a rationalisation in various sectors. Moreover, marginal increase or decrease does not affect the overall placement performance. We rather look at the number and diversity of offers and participating institutes.”

Double-digit growth at few B-schools

A few B-schools, such as IIM Indore, VGSoM, IIT Kharagpur and Goa Institute of Management have defied the generic trend with an increase in their annual salary packages by 12 percent, 14.75 percent and 14 percent respectively.

B-schools offering specialised programmes witness a bright season

While a majority of the top B-schools offering general MBA has observed either marginal increase or dip in the average salary, the noted B-schools offering specialised MBA programmes experienced a bright placement season this year.

NITIE or National Institute of Industrial Engineering Mumbai, offering specialised management programmes in industrial engineering has witnessed the highest increase percentage of average salary, which is 16.55. Indian Institute of Forest Management Bhopal, Institute of Rural Management Anand (IRMA) and Symbiosis Institute of International Business (SIIB) Pune have also received a double-digit percentage increase in terms of the average salary for their 2018 batch students, which are 16.1 percent, 11.44 percent and 12.63 percent respectively.

SIIB Pune, which also offers specialised MBA programmes in Agri-Business Management and Energy & Environment Management, has seen an upward trend in the salary figures of these two programmes. The percentage increase for MBA-E & E and MBA-AB has accounted for 35.46 and 24.64 respectively. However, the salary figures are less than Rs. 10 lakh, i.e. Rs. 8.75 LPA and Rs. 8.48 LPA for MBA-AB and MBA-E & E respectively.

In contrast to the above trend, IIFT Delhi and Symbiosis School of Banking and Finance, however, have witnessed a slight decline in the salary figures. According to Prof. Manoj Pant, Director, Indian Institute of Foreign Trade, New Delhi, a dip of less than a percent is not worrying for an institute like IIFT. “An annual package of Rs. 18.27 LPA is a good industry benchmark at this point in time. The overall average package, including the international offers, is Rs. 19.23 LPA. Moreover, the batch of 2018 saw an increase of 55 percent international offers. This, despite, we had a larger batch with 30 more students participating in placement this year. Hence, I don’t see any downward trend as such by just comparing the average salary of two years.”

Top IIMs skip releasing salary figures resulting in ambiguity

Amid annual packages being the key highlights of the placement reports from B-schools, many B-schools avoid publishing their average salary packages in campus placements. This list includes top IIMs such as IIM Ahmedabad, Bangalore, Calcutta and Lucknow. While IIM Ahmedabad releases the audited report by IPRS, the other old IIMs do not divulge the data on salary figures, leading to obscurity.

IIM Bangalore officials say that since many top recruiters do not publicly share their offered remuneration, the accurate reporting of average salary is not possible. Prof. Ganesh N Prabhu, Chairperson, Career Development Services at IIM Bangalore states the reasons for not divulging the salary figures in a Quora answer as, “IIMB average is under-reported from the actual average (which is unknown) as some of these top paying recruiters do not reveal their salary data to the IIMB placement office and are thus not included in calculating the batch average salary. Since these recruiters are known to pay very well, they are just counted as present in the top quartile of salaries in rank order – this is used for calculating the more representative median salary of the PGP batch at IIMB.”

As per the IPRS report and NIRF data, the median salary for the 2017 batch of IIMs are brought in the table below.

Median salary of IIMs for 2017 batch

 

Source: IPRS and NIRF data

Despite the placement season being moderate for the majority of B-schools, the fee for the flagship programmes at many top colleges and old IIMs including IIM A, B and C have been increased to Rs. 22 lakh and Rs. 21 lakh respectively, raising ROI concerns among MBA aspirants.

Read Careers360 story on IIM fees here.