The Wall Street Journal (By Melissa Korn)
Normally, schools offer scholarships to entice students to enroll. This year, the Massachusetts Institute of Technology's business school handed them money to go away.
The Sloan School of Management's full-time M.B.A. program, usually about 400 students, was oversubscribed by an unusually high number of students this year. Rather than expand the class size, the school asked for volunteers willing to wait a year to enroll, sending out an e-mail just a couple of weeks before the Aug. 23 kickoff barbecue. By that point, many expectant students had quit jobs and secured housing in the Boston area.
How did the math whizzes at MIT get the numbers so wrong?
Colleges and universities see a fair amount of last-minute movement, known in admissions circles as "summer melt," when students change their plans or decide to attend another school after getting in off the wait list. But predicting how many will do so has grown harder lately, admissions consultants say, because candidates are applying only to the schools they really want to go to. At Sloan, a higher-than-expected number of students stuck with their plans to attend, Rod Garcia, senior admissions director, said in an emailed statement.
Sloan received 4,133 applications for the M.B.A. program that started last month; of that number, more than 10% enrolled.
After realizing they had a student surplus, school officials emailed the incoming class on Aug. 7, offering "guaranteed admission to the class of 2015 for the first 20 admitted students who request it." The school gave them until Aug. 13 to respond, according to one student's copy of the letter, which was reviewed by The Wall Street Journal. But it didn't get enough takers.
So, like an airline offering vouchers to travelers willing to hop off oversold flights, the school put money on the table, offering students who expressed an interest a $15,000 scholarship to be applied to next year's tuition. Students still balked, and on Aug. 21, a day after pre-term refresher courses began, Sloan raised the offer to $20,000 for the first 10 respondents. (Tuition for the 2012-2013 academic year is $58,200, with total expenses—including books, housing and food—estimated at just under $89,000.)
Four incoming Sloan students volunteered, said Mr. Garcia, and the school started the year with an M.B.A. class of 413, up from 404 last year. The $80,000 in funds will come out of next year's fellowship pool. He added that the school expects some deferring students won't end up enrolling next fall. (If they don't enroll, they won't get money from MIT.)
Offering money for a deferral is uncommon, but not unprecedented. Sloan made a similar offer last year, when it had a surplus in its young and fast-growing master's in finance. And in 2006, Yale School of Management offered accepted students a 50% tuition rebate for their first year, amounting to $21,000, in exchange for deferring. More than 30 admitted students ultimately took the offer, allowing the school to keep its M.B.A. class at about 180.
Deferrals were attractive when the economy was stronger, allowing students to pursue a new business venture or take a long vacation, but the current outlook probably makes a year off less appealing to many, said Graham Richmond, co-founder of the admissions consulting firm Clear Admit.
A Sloan student who took the deferral fellowship had already quit her job, rented an apartment and sold her car. The woman, who asked that her name not be used, sublet her Cambridge apartment, though at a loss. She will spend part of the year traveling, and work on media projects.