Posted by: Alison Damast on September 15, 2008
The jolting news of Lehman Brothers’ bankruptcy filing and Merrill Lynch’s acquisition by Bank of America has made for an anxious start to the new school year, especially for those students looking for jobs in the investment banking sector. While it’s still too early to tell what the impact will be on students, career services officers at business schools are bracing for “rough waters” ahead, said Kip Harrell, board president of the MBA Career Services Council, the umbrella group of school career placement officers, in an interview on Sept. 15.
The schools that will be hardest hit are likely those that are known for their strong finance offerings, where large investment firms like Lehman and Merrill tend to heavily recruit, Harrell said. “The students at those schools may be scrambling more so than the schools that don’t send a lot of students to investment banking,” he said.
Career services officers at those schools said they are anxiously awaiting world from Lehman and Merrill on whether or not they plan to honor the job offers they extended to second-year students, as well as their plans for fall campus recruiting.
“We don’t know the impact yet on recruiting for second-year students,” said Julie Morton, associate dean for career services at the University of Chicago’s Graduate School of Business.
At the University of Virginia’s Darden School of Business, career services officers have spent the day reaching out to students who worked at the beleaguered firms this summer, said Jack Oakes, director of Darden’s career development center. The school has strong relationships with Lehman and Merrill, both of which have been “long-time recruiters” at the school, he said. He has not heard yet from recruiters at either firm, he said.
“There certainly will be a direct impact on students,” Oakes said. “In fact, we’re meeting with some of our affected students tomorrow to see what they’ve heard directly from the company, to hear their thoughts and concerns and advise them accordingly.”
In the meantime, career services officers are advising students to cast a wide net as they conduct their job and internship hunts this fall, especially those who intended to go into investment banking. They should consider jobs in other areas of the financial services sector, such as corporate finance or internal auditing, and consider jobs at small boutique investment firms, Harrell said.
“We’re being very honest and upfront with our students,” said Harrell, also the associate vice president of Thunderbird School of Global Management’s career management center. “They’re asking lots of question, but we’re telling them that New York may not be the best place to look right now. For those counting on investment banking, they are going to need to beef up their plan B.”
BusinessWeek will be following this story in the coming weeks. Has anyone with job offers from Merrill or Lehman been impacted by this? Are you anxious about your job prospects?