Plan A for many Duke University seniors is to parlay a past summer internship on Wall Street into a full-time job with a six-figure salary. But the storm that slammed the banking industry and wreaked havoc in the global financial markets has forced some students to consider plan B.
Financial companies slashed 150,000 jobs in 2007 and are speculated to have eliminated more than 100,000 jobs in 2008, The New York Times blog DealBook reported this month. At Duke, where a large proportion of the Class of 2008 went into finance, the volatile financial landscape of vanishing jobs and employment uncertainty is a source of panic for many once Wall Street-bound seniors.
Mike, one senior who asked that his real name not be used, received a job offer from Lehman Brothers after completing a summer internship at the firm but was forced to seek out other employment options when the company went under.
"It was like, 'Welcome to the real world b-, you may be unemployed next year,'" he said. "Most people at Lehman could sense trouble. I started applying to other firms while I was there just in case something happened, but no one realized that the trouble was everywhere. And now it's a rat race for jobs."
Career Center advisers are helping undergraduates weather the financial storm.
"The Career Center has been anticipating this situation, given everything that's been happening in the markets and the cutbacks we've been seeing in firms," said David Lapinski, assistant director of employer relations for the Career Center. "We've been trying to identify and introduce alternative career paths and companies to students, encouraging them to look outside of the same ones that are usually looked at."
Lapinski said he has seen the effect of the financial job crunch reflected in recruitment cutbacks by major financial firms. Several of these institutions with a strong tradition of on-campus recruitment-including Lehman Brothers, Goldman Sachs, J.P. Morgan Co. and Morgan Stanley-cancelled recruitment sessions at Duke during the Fall.
Some banks are still recruiting at Duke but are coming with far fewer employment opportunities, Lapinski said. A spokesperson at Deutsche Bank said the firm is still actively recruiting at select universities-including Duke-this year but would not comment on the number of job offers expected to be given out to graduating seniors, noting that it is "a sensitive situation."
Lapinski has encouraged students to explore alternative financial sectors, noting that the Career Center has resources in a wide array of fields.
"There are so many opportunities in areas like equity research, asset management, global markets and many others at firms that are perhaps under the radar, but all actively recruiting [at Duke]," he said. "There is a broad spectrum of employment that's available out there."
Lapinski cited Humana, Macy's and Accenture as a few these companies.
Admissions offices across the country are also preparing for the effects of the economic downturn. Historically, climates of financial upheaval result in a large increase in graduate school applications, admissions officers noted. Although it is still early in the application cycle for graduate schools, U.S. News and World Report has recorded close to a 25 percent increase in the number of GMAT tests given in August from 2006 to 2008.
Kenneth Kleinrock, assistant dean for admissions at New York University School of Law, and Bill Hoye, associate dean for admissions and financial aid at Duke's School of Law, predicted that the economic slump will likely result in a spike in law school applications.
"I guess the topic sentence is 'stay tuned,'" Kleirock said. "But if the markets' contract continues, we will likely see an increase of around 20 percent, which is what we saw after 9/11. And the number of seats in law schools does not change, so as a consequence, competition gets stiffer."
Some Duke students said they worry that positions in consulting, law school and business will become increasingly difficult to attain because of sharply increased levels of competition.
Despite the setbacks, Mike said his desire to enter the finance industry has not diminished.
"This is what I want to do," he said. "Come hell or high water, I'm going to get there. It just might involve a little more of a detour than I'd originally planned."
For some students, the uncertainty in the financial markets is not without a silver lining. Senior Christian Richman said he views his current situation as a blessing in disguise.
"I think we can look at this as being good in a way, because even though investment banking is a really desireable job, I don't think everyone at Duke really wants to do that," he said. "I'm happy to say that I've enjoyed my new job search because now I'm looking more at quality of life, places that are more beneficial for me... places where I'd be the happiest."