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When Gustavo Barajos graduated from the WP Carey School of Business at Arizona State University in 1997, the job market was appalling. Companies were reluctant to recruit in significant numbers and many classmates graduated without jobs. But Mr Barajos bucked the trend.
Two months before graduating he was offered several jobs and took one with Intel. He then worked for Raytheon and American Express as a senior industrial engineer, helping globalise their designs for Spanish-speaking countries such as Costa Rica.
Mr Barajos knows two qualifications helped him gain these jobs: his MBA and being Hispanic. “Everyone needed Spanish speakers and someone who understood the Hispanic culture. I offered both and was snapped up.”
American companies are keen to attract Hispanic employees in order to gain access to these markets. According to HispanTelligence, the research division of Hispanic Business magazine, the latest figures show that advertisers spent more than $3.3bn (£1.6bn) on marketing products to US Hispanics in 2005, up 6.8 per cent from 2004. It forecasts that the Hispanic consumer market will be worth $1,060bn by 2010.
Advertisers are using more targeted campaigns and companies are creating new products in a bid to capture this growing market. Hewlett-Packard, the technology company, is now producing Spanish-language computers and last November launched a Spanish website with bilingual phone assistance.
While US business is eager to attract Hispanic consumers and employees, the number of Hispanics in US business schools is weak and waning. The National Society of Hispanic MBAs (NSHMBA), a non-profit group, says that in 2004 the percentage of Hispanics in business schools was only 3.9 per cent. Last year, Hispanic Outlook magazine reported that of 682 Hispanics graduating with masters degrees from Florida International University in Miami, only 260 were business degrees.
The Graduate Management Admission Council found that in 2006 only 5,971 Hispanics took the Graduate Management Admission Test, compared with 8,728 African-Americans and 11,528 students of Asian descent. While the numbers of African-Americans and Asian-Americans taking the GMAT rose from 2004 to 2006, Hispanic examinees declined by 5 per cent.
Louis Olivas, an associate professor of management at the WP Carey School of Business, is concerned about this trend. He has been studying Hispanic business for 30 years and has found that the number of Hispanics attending the top 25 programmes today is unchanged from 10 years ago.
He sees the problem as in part due to aspiration. Few Hispanics pursue post-
graduate education because a bachelor’s degree alone makes them marketable and boosts their earning power. Graduates are expected to help their parents financially or to start their own families. Convincing undergraduate Hispanic students to stay in debt and study for another two years is a hard sell, Prof Olivas says.
MBA graduate Mr Barajos agrees that culture can be a barrier to post-graduate studies. Hispanics are traditionally “hard-working, family-oriented, grass-roots kind of people”. While this makes them great employees, it doesn’t make them strategic, he says. “Having an MBA is strategic. One plans for it and saves for it.”
Prof Olivas says that science, engineering and business are not considered traditional educational routes for Hispanics in America.
“Traditional Hispanic work-paths would be education, sociology, social work and teaching,” he says.
A key barrier is financial. David Riojas from Monterey, Mexico, is studying marketing at the McCombs School of Business at the University of Texas at Austin. Over the summer he had an internship with the marketing department at PC-maker Dell, helping improve its marketing to Hispanics, a large proportion of its customer base.
Mr Riojas says that although MBAs are becoming more appreciated among Mexican business leaders, few Mexicans can afford the degree. “Most of us are very poor,” he says.
However, companies and business schools are trying to change this. The University of Texas at Austin, for instance, has a programme called Tuition Assistance for Mexican Students (Tams), whereby students pay for their tuition at the Texas resident rate rather than the pricier international fees.
McCombs also offers recruiting scholarship and Good Neighbor Scholarships. Mr Riojas received help from Tams as well as winning a scholarship so that his tuition fees were half the usual $19,450 a semester.
Nonetheless, Mr Riojas says he is only able to afford his degree thanks to savings, student loans and his brother, a permanent resident, acting as his co-signer. “I am very lucky. Most don’t have this.” NSHMBA also helps Hispanic students through its scholarship programme, worth $1m a year.
McCombs also heads Jump Start, an outreach programme which extols the benefits of a business degree to minority undergraduates and even high school students. Now in its second year, the programme has been a success, says head organiser Vicki Duran. Partners such as Frito Lay, the snack food company, Wells Fargo bank and JPMorgan Chase pay for the student’s MBA and hire them afterwards. “For Hispanic undergraduates, this is very appealing,” she says.
Some schools are also supporting Hispanic students once in business programmes. Stanford Graduate School of Business, for example, has the Hispanic Business Students Association, which helps newcomers find information about courses and professors.
“This makes the introductory process more welcoming and less intimidating,” says student Joia Pardo. Stanford also participates in the Management Leadership for Tomorrow Program, which invites prospective MBAs from minority communities to a two-day conference. Experts advise on preparing and applying for an MBA and all housing and meal costs are covered.
Since 2005, the school has also run outreach sessions at undergraduate schools in Mexico, Argentina, Columbia, Chile and Brazil. And three years ago, the Business School Alumni Association introduced a Stanford GSB Hispanic directory for camaraderie and networking. Hispanics are also honoured through various fellowships and awards.
NSHMBA holds annual networking conferences, talks on business issues and career exhibitions to help Hispanics network, develop their careers and find jobs. Last year’s conference attracted 6,800 Hispanic MBAs, more than 200 corporations and 74 universities. This year’s attracted more than 8,000 MBAs, 1,000 more than predicted, and more than 300 sponsors.
While such initiatives are welcomed, many believe more should be done. Prof Olivas says business schools should make their programmes more appealing to Hispanics, for example by setting up courses dedicated to Latin American business.
Students want more corporate-funded scholarships. Others ask for more outreach, especially from companies, to talk about the benefits of an MBA.
Unlike Mexican companies, which are experts at marketing to the poor consumer, Mr Riojas thinks many US companies underestimate the importance of Hispanic consumers. “There is a knack to going after this group and most Americans don’t get it. I only know this from working in Mexico and from growing up there and being exposed to the billboards and media,” he says.
“More companies and schools should acknowledge this and subsidise MBAs for the Hispanics who can help. They will quickly make their money back.”
Biggest US minority expected to hit 102m by 2050
The Hispanic population is the US’s largest ethnic or race minority, comprising 15 per cent of the nation’s total population.
The estimated total Hispanic population of the US on July 1 2006 was 44.3m. The current total US population stands at 303,209,488.
The US’s Hispanic population is the fastest growing minority group, rising 3.4 per cent between July 1 2005 and July 1 2006.
It is estimated that the Hispanic population of the US will reach 102.6m by July 1 2050 and, according to projection, Hispanics will constitute 24 per cent of the nation’s total population by that date.
Source: US Census Bureau