Business schools are big business. At any one time, as many as one million students are attending business schools, which award approximately 200,000 MBA degrees a year.

Business schools are so big, in fact, that they dominate graduate education in the U.S. Newly minted MBAs outnumber engineering graduates in the U.S. by five to one. They outnumber computer science graduates in the U.S. by six to one.

(Aside: Now you know exactly why the U.S. is losing its competitive advantage in high tech.)

A two-year MBA program at a top school can cost $100,000 in tuition alone. When you factor in lost wages, opportunity cost, and living expenses, a two-year MBA degree can cost upwards of $250,000.

Given the expense and popularity of the degree, you would think that corporate recruiters hold MBAs in high esteem.

Nothing could be further from the truth, according to a new study conducted by Professor Jeff Kavanaugh at the University of Texas at Dallas. Turns out that corporate recruiters--the people who hand out plum jobs--think MBA graduates haven't learned much useful.

and had their support in the study, but it was funded by him as an individual

Kavanaugh surveyed 500 business school leaders, 3,000 business school students, and 10,000 corporate recruiters. The results showed a colossal disconnect between what business schools are selling and what companies are buying.

An astounding 98 percent of corporate recruiters don't think that MBA programs are making students "career-ready." That's such a high percentage that it makes you wonder if the remaining 2 percent understood the question.

At the same time, MBA students dramatically overestimate their proficiency across almost all the skills that recruiters might value.

According to the study, recruiters highly value 1) work ethic, 2) critical thinking, 3) teamwork, and 4) communication skills. When asked to rate students on these skills,

"Recruiters didn't assess the average MBA student above a 7 in any of the four skills they ranked as most important for a student to have. Students, on the other hand, did not score themselves lower than 7 in any category."

To make matters worse, when recruiters were asked the one thing that B-schools could do to prepare students for the work force, recruiters by a large margin recommended 1) real-world experience, 2) critical thinking, and 3) work ethic.

MBA students, by contrast, thought B-schools should teach 1) career management, 2) soft skills, and 3) technology, two of which recruiters rated as being of very low importance. (The exception was "soft skills.")

More important, MBA students rated real-world experience and critical thinking low importance. And guess how many name "work ethic" as most important? Zero. Nada. Zilch.

What we have here is a nearly complete disconnect between what schools are teaching and what students need to know. And, sadly, the students don't even know what they don't know.  Kavanaugh draws this apt comparison:

"Imagine if students were told that being able to translate written Spanish was evidence of fluency. Later, when applying for jobs as translators, imagine recruiters tested students' fluency by making them have spoken conversations. Students would believe they were fluent, recruiters would not."

IMHO, that B-schools--while charging students insane amounts of money--aren't teaching what recruiters want to see in candidates borders on fraud.

Seriously, if I were in an MBA program, I'd transfer to law school, so I could start a class-action lawsuit against B-schools for failing to deliver what they promised.