Rajeev Parashar, a quality assurance engineer in an IT company in Bangalore, appeared for the Common Admission Test (CAT) last year but couldn’t make it to any of the premier Indian Institutes of Management (IIMs). Soon after, the slowdown hit the job market in India too, which has made him defer his plan of taking the exam.

12 pc drop in registerations

Parashar is simply a case in point. There are many such young professionals who have decided to hold on to their jobs rather than appear for the CAT exam. The figures tell the story. The estimated number of CAT applications was 230,000 in 2007 which rose to 290,000 in 2008. Due to errors in application forms, some were rejected and the final number of accepted registrations in 2008 came to 276,000. However this year, the total number of accepted CAT registrations has come down to 241,000 -- a 12 per cent drop over the previous year.

Fee structure could be one reason

Another cause for worry is the fee. While the IIMs offer need-based financial assistance, there is still some worry about repaying bank loans at a time when there is uncertainity on pay packages offered during final placement. At IIM Ahmedabad for instance, the institute announced in March this year that fees for the first year, from the 2010-12 batch, would be increased to Rs 6 lakh from Rs 5.5 lakh and in the second year to Rs 6.5 lakh from Rs 6 lakh.

"Recruitments are down and hence, people's desire to spend money on their future through CAT is also less because the total cost of taking the CAT and paying fee in a management institute almost comes to Rs 20-25 lakh.

Shadow over IT recruitments

Ajay Arora, director of a coaching institute in Bangalore feels that with companies trimming positions, employees worked over-time to ensure their jobs were safe leaving them with very less time to prepare for the exam. There's also a shadow over IT companies recruiting this year, leading employees to holding on to the jobs.

Transition to online exam