Article: Business is the most popular major but that doesn't mean it's a good choice.

Parents Forum
101

The argument about Wharton vs. Hass is really a side show. As is the argument about majoring in Econ at Penn vs. Econ at (fill in the blank with a top tier college.)

The majority of kids who major in business in America do so at college’s where content is valued over analytic rigor (and much of the content becomes obsolete very quickly-- think about a marketing course in 2001 when E-commerce was becoming a “thing” vs. today).

Those are the kids to worry about. I’ll assume that the Wharton kid can take care of him or herself.

There are colleges in America where you can major in “International Business” without fluency in a foreign language, or an in-depth history class on the region in question. There are colleges in America where you can major in Organizational Behavior and yet have no knowledge or understanding of the underpinnings of psychoanalysis, cognitive science, or ANY of the sciences which have led to current understanding of how and why people make decisions and behave in the way they do. There are colleges in America where you can major in “just business” and yet not know what supply chain management is, how interest rates impact inflation, why the currency fluctuations between China and the US are important to understanding who exports and who imports and who holds which country’s debt.

That’s why employers are suspicious of business degrees. Not because of the prep at the top of the food chain- but because business degrees become the default “I don’t know what to major in, and don’t want to work very hard or have to read a lot, so I’ll major in business and get a good job when I graduate.”

102

Can the extra 30 credits be anything (i.e. not requiring master’s level study)? If so, couldn’t someone who has all of the subject requirements fulfilled just take 30 extra credits of anything at a community college to reach the 150 credit minimum?

103

If my understanding is correct, CPA is administered and tested at the state level. As a result, the course requirements and thus the curriculum designs of Master in Accounting programs are quite different across states.

In my school, Master in Accounting is a 2-semester (1-year) program for accounting undergraduates. It is a 2-semester + 1 previous summer program (1-year) for business undergraduates. It is virtually a 2-year program for non-business undergraduates.

The following is from Ohio State:

"Admission to the Fisher MAcc program is open to graduates with the equivalent of an accredited four-year U.S. bachelor’s degree in virtually all areas of study: liberal arts, business, engineering, and other.

Students must complete five “prerequisite” accounting courses to complete the MAcc program. If you have not completed all five in your prior coursework, Fisher offers options to complete a portion of these courses through our Pre-Macc and MAcc programs.

You must have completed Principles of Financial Accounting and Principles of Managerial Accounting in order to be reviewed for admission to the MAcc program."

The 5 prerequisites are intro financial accounting, intro managerial accounting, intermediate financial accounting I, intermediate financial accounting II, and intermediate managerial accounting. The later three often require the previous two as prerequisites as well. So here we are talking about an additional 1-2 (or even 3) semesters of course scheduling.

Furthermore, it says “You must have completed Principles of Financial Accounting and Principles of Managerial Accounting in order to be reviewed for admission.” In many liberal arts colleges and universities without an undergraduate business school (including Yale), they simply do not offer intro financial accounting AND intro managerial accounting. This introduces another logistical complexity.

Even at a state where one without an undergraduate business degree can do it in 1 year, obtaining an internship in accounting before hitting the job market can be an issue as well, as I mentioned earlier.

104

Internships weren’t an issue with the non-accounting undergrad majors I knew who became CPAs.

In the case of my HS classmate who was an Ivy lit major, that was taken care of by her being offered to be taken on right out of the blue by a Big-4 accounting firm during her junior year of undergrad right through them fully paying for her 1 year Accounting Masters course, CPA prep/fees, etc and then right through until she left on good terms to join a boutique accounting firm where she is currently.

In the case of the Philosophy major friend who graduated from a university ranked between 60-120, that was taken care of by his taking on bookkeeping and accounting related duties at his jobs between undergrad and 1 year accounting Masters.

105

I seriously doubt a degree in finance from NE Crap College is much easier or harder than a degree in history or comm arts from the same school.

I believe accounting CPA ed standards are relatively uniform and they all take same national exams.

UW has similar programs–1 year masters for accounting majors and 2 years for non accounting majors.

https://wsb.wisc.edu/programs-degrees/macc/gmacc-program-overview

106

Technically, yes. However, there seems to be an increasing trend of undergrad accounting majors I’ve known/heard about taking the 1 year accounting Masters course since the 150 hour rule was put into place in the late '90s. Granted, a part of that might be a form of a self-inflicted “degree arms race” to ensure they remain competitive for the accounting jobs they’re targeting.

107

Employers should be suspicious of business degrees, but, as a rule, they aren’t. That’s the message of post #34, and the data posted in the link there is hard to argue with. Far from being suspicious of business degrees, employers are taking all they can get. Most of the employers who traveled to Madison to hire BBAs from UW probably would have been better off spending their hiring time over in the College of Letters & Science. But instead of hiring a physics or philosophy standout, they hired a lower wattage bulb from the business school.

Well, the dim bulb employers got what they were looking for.

108

Would you consider Janet Yellen who taught at Berkeley Haas as a low wattage bulb? I don’t think so. Many of our kids are regents and National Merit Scholars. Sorry Haters. Business schools are full of the best and brightest, the so-called 150 watt bulbs.

109

The education that the students receive is the issue here, not the faculty. Even at the elite schools, the business students (and the econ students) cannot hold a candle to the hard science kids studying subjects like chemistry, physics, math, computer science, and engineering. Some write well, but most do not. I know, because I have to train them after they are hired. I will take the physics and Latin double major from a top LAC any day of the week over any of the business school graduates. Any of them. But my view is definitely the minority view.

110

Getting into a top business school undergrad program like MIT, Haas, and Wharton takes the same smarts as the likes of Harvard, Princeton and Yale.

111

I don’t know if Rusty’s view is in the minority, but it is a gross overgeneralization.

112

“However, there seems to be an increasing trend of undergrad accounting majors I’ve known/heard about taking the 1 year accounting Masters course since the 150 hour rule was put into place in the late '90s. Granted, a part of that might be a form of a self-inflicted “degree arms race” to ensure they remain competitive for the accounting jobs they’re targeting.”

My interpretation is different. This is where accounting folks are really smart; they know how to manage the production of CPAs by raising the bar (from 120 to 150 credit hours) so that their profession does not look like the law profession today in which lawyers are over-supplied.

113

Has the number of accredited accounting departments/Masters programs remained constant or even decreased since the '90s? Especially considering from what CPA friends/relatives have related, academic pedigree/name isn’t nearly as critical in the accounting field with the exception of a few niche areas as the case with the legal profession…especially after 2008.

Just curious as there has been a massive increase in the number of ABA law schools opening up/founded since I graduated college at the end of the '90s/early '00s…most of which have relatively low barriers of entry(150 or less LSAT, below 3.0 undergrad GPA). And I’m not including the non ABA-accredited law schools in California…some of which are little better than glorified fly-by-night infamous for-profit type colleges.

114

“Has the number of accredited accounting departments/Masters programs remained constant or even decreased since the '90s?”

I believe accredited departments has remained quite constant over the past 20-30 years. One reason for this is that, again, accounting folks are quite smart, they have very good management on the PhD level production. When it is difficult and costly to hire accounting PhDs, weaker universities would simply not be able to join the accredited-market. When I was first in the teaching job market about 18 years ago, a newly finance PhD would earn about 10% more than a newly accounting PhD. Today, this difference disappears. Furthermore, an accounting PhD from a second-tier doctoral school often gets an offer from a first-tier university (I bet you rarely hear anything like it; in many fields it is hard to get any teaching job even with a few years’ of post-doc). At my doctoral granting institution, I took a few courses with our accounting doctoral students (4 of them). They all got at least a (of course tenure-track) teaching offer when they were in their 3rd year of study; that is, they still had at least one year to finish their dissertation. Now, I think you understand whey I said accounting folks are smart.

Master in accounting program is more of recent thing. The number of programs is growing, and the demand for their graduates has been very strong: at an annual growth rate of about 5-10%.

115

“academic pedigree/name isn’t nearly as critical in the accounting field”

True when it is compared to finance.

116

Until the recent amalgamation, Canada’s most prestigious accounting body was the CA. At the end of their studies, including an internship, the students would have to write the UFE, a uniformed exam administered across the country for the designation. The pass rate was 6X to 7X% range for most sittings.

Students could sit for the exam more than once, but the firms where they worked would not want to keep them after two or more failures. Not surprisingly, some schools and some provinces did better than others, consistently. My kid’s alma mater is a finance school, not an accounting school, but the students’ UFE pass rate have always been exceptional-92% on first sitting when kid2 was graduating, the best in the country.

The moral of the story is simple: If the school can attract a national student body, and an admissions rate under 10%, you can pretty well spend all four years playing beer pong and still do well. The schools are given too much credit, in my opinion.

@RustyTrowel - If you are interested in majors and brain power, this article is for you:

http://blogs.discovermagazine.com/gnxp/2012/01/classicists-are-smart/#.WJ4L7rjaut_

Economics do very well, and ditto for classics and philosophy.

117

I usually recommend business-oriented students major in either finance or accounting, and if accounting commit to becoming a CPA. There are schools that offer a joint undergrad/MBA/MS to meet the education requirement for Texas CPA in five years.

118

I can’t disagree more with @RustyTrowel . Lol at lower wattage bulbs, ha. What a warped view.

In my career experience I found those with business related degrees actually got work DONE.

119

I think there are a lot of broad brush strokes being bantered about. Every major will attract smart kids. I know there is a running joke about nobody ever says they want to be an accountant in middle school but when these kids enter college and want a profession that takes critical thinking and creativity many will look to finance and accounting. Bookkeeping is rigid but accounting is not. Business will pay big money to creative accountants and finance people to achieve the goals they wish to achieve. Finance, accounting and treasury departments are viewed as profit centers just like any other department. Business school teaches you to view the world through the prism of money and become a master of it. If you do not think money is a basis for many many decisions in the world, then you just will not understand why finance and accounting are very worthy professions.

120

@MassDaD68 Agreed! Every company needs an accountant, whether they are profitable that year or not. Finance makes the world happen, beyond investment and international banking. Careers in these fields translate to a good life and opportunities in large and small communities.