Not so long ago business management students flocked to Europe. Compared with their American counterparts, European schools were cheaper and their student bodies more diverse, both attractive features — and the salaries of European MBA graduates were often higher. Some of these attractions remain undimmed. But they are no longer enough to bring in the punters. Data from The Economist’s latest ranking of full-time MBA programmes suggest the appeal of Old World business education has gone into a rapid decline.

The intakes of many of Europe’s flagship full-time MBA programmes have plummeted. Enrolment in Aston Business School’s MBA, for example, more than halved in the past academic year, falling from 129 students to 59. By far, the biggest drop is of Asian students. HEC School of Management in Paris enroled 181 full-time MBAs in the past academic year compared with 233 in the previous one. It is a similar story across Europe. Some smaller schools have been desperately scrabbling around to find the 30 students that some MBA rankings see as the minimum for a course in good standing.

One obvious reason why students stay away is the dire economy. MBAs can look like a good way to sit out a short downturn. In a longer one, they lose their charm. With no job-producing European recovery in sight, going there for an MBA seems not so much cleverly counter-cyclical as stubbornly contrarian.

Europe’s slide also reflects a problem specific to its most important MBA market. The average class size of the British MBA programmes ranked by The Economist has decreased by 11 percent over the past year. Schools blame Britain’s newly toughened visa requirements for non-EU students. Graduates used to have an automatic right to stay and work for two years. Now, they must find a sponsoring company and land a job which pays at least £20,000 (Rs.17.05 lakh) a year. The number of visas available to students wanting to start their own business is piddling.

Would-be students are well aware of this. David Simmons, director of the full-time MBA programme at the Cranfield School of Management, says comments telling prospective students to forget about coming to Britain are rife on Indian MBA blogs. The recent debacle at London Metropolitan University (LMU) has fortified this impression.

AMBA, a British-based accreditation agency for business schools, is lobbying the British government to take a less bludgeon-wielding approach. Students on the MBA programmes it accredits must have clocked up at least three years’ work experience since acquiring an undergraduate degree. These, it thinks, are exactly the bright sparks the country should be wooing. “These are not people coming here just to find work in McDonalds,” says Carol Turner, AMBA’s communications director.

The fact that European schools are struggling is particularly galling because America has also made it more difficult for foreign students to work in the country after graduation, providing what should be an extra opportunity for the Europeans. American MBA programmes are typically twice the length of those in Europe, making both the cost and the opportunity cost of studying there higher.

Instead, the countries doing well out of America’s closing doors and high costs are Canada and Australia. Australia recently ditched its own strict policy on student visas in favour of a more welcoming approach. And Canada has seen a bigger increase in applications for full-time MBA places than any other country. Charmaine Courtis, executive director of student services at York University’s Schulich School of Business in Toronto, says that around 80 percent of foreign MBAs at the school now choose to stay and work in Canada immediately after graduation. After that, she adds, most tend to return home.

(Excerpted and adapted from The Economist)