The cutback is definitely supply driven. At my school there are still far more students interested in banking jobs than there are available.

However, if compensation continues to decrease the business model will have to change. It is going to be harder to convince kids to work 90 hour weeks if the pay is not significantly greater than other opportunities.

Let's work up a "Sharpe ratio" coefficient for financial service jobs. All the uncertainties: regulatory, variable equity based deferred comp, 200k/yr job purges... I bet a $150 - $200k/year C&I banking job delivers better alpha.

As a current student at one of the institutions mentioned in the article, I can certainly corroborate your suspicion that it is demand that has shifted (and sharply so) vs. supply. As my wannabe-consultant classmates would say -- I think that we are experiencing a monumental paradigm shift

It is high time! These so called investment bankers created no value for society, they were a net drain on our resource, as a nation. We can do with 90% of them gone. Good riddance, find a real job now!

Midwest...that is funny. I have worked for commercial banks, manufacturing companies and non profits. Sixty hour weeks are the norm and ninety not uncommon.....for considerably less pay than investment bankers...so regardless of where you end up, much will be expected.

I'm currently enrolled in one of the programs listed in the article, and I can say without a doubt that those who may have originally intended to pursue I-banking have since changed their pursuit and are looking towards summer and full time positions in Consulting, Corporate Finance, or General Management. These career paths seem more stable and do not have the poor reputation held by those on Wall Street...

"Are there any would-be investment bankers out there who have given up on the idea of a Wall Street job in favor of something a little more ordinary?" I doubt it, but maybe!

I'm at a top MBA program right now and recently decided to accept my offer in investment banking over a sponsorship offer I had from my previous consulting firm. It was a difficult process and I had to think long and hard about the merits of banking as a career. A few thoughts about the career/decision:

1. I'd like to see some hard data on the so-called dwindling recruiters on campus. I'm actively involved in the banking club, and I can tell you that there was no drop off in the number of recruiter visits, lunches, dinners, etc relative to last year. There were fewer offers for summer internships, but with banks reporting revenue decreases of 30+ percent, isn't that what one would expect? I'd be very careful about designating this as a 'trend' and not just an impact of a natural and probably healthy business cycle.

2. Doesn't this same phenomenon happen every time that there is a retraction in the banking industry? Take a look at the definition of 'Harvard MBA Indicator' on other sites. I'm not saying this is exactly the same type of occurrence, but I think recruiters are probably refocusing on a core group of schools as they come to the realization that the industry will remain smaller for the foreseeable future. This means fewer MBA jobs, which will impact the demand side as well as the supply side as folks decide it's not worth the effort to even go through the arduous recruiting process.

3. On the supply side, I do agree that banking is a relatively less attractive job than it was before. The long hours, combined with the falling bonuses, make it an unattractive job for someone looking for a 1-2 year gig. I think the recruiting process has shifted in that people who decide to recruit realize that they need to be in it for a longer haul to 'cash in.' To that end, though, let's be careful not to label the industry as being 'dead.' There are only a handful of other jobs in the world where you can make $500k+ in your early 30s, so as long as there are ambitious MBAs out there, there will be a consistent supply of willing applicants regardless of the economic cycles.