The Job Hunt Goes Mid-Market

As large financial firms become skittish about hiring, MBAs are turning to boutique and regional companies

By Alison Damast

Recruiters at Harris Williams & Co. usually spend July and August handling a small stack of résumés and gearing up for the fall hiring season. But this summer, things have been far from quiet at the boutique investment banking firm in Richmond, Va. More than 300 résumés have landed on Stevie McFadden's desk this summer—and that's not counting the dozens of casual inquiries she's received from prospective job applicants and MBA students.

"Suddenly, there is so much opportunity," says McFadden, the firm's recruiting director, who flew to New York this week with her COO, Dena Moore, to conduct interviews with promising candidates. "The summer is historically a dead time in recruiting, so this has definitely changed the way we're looking at how we fill our talent need."

Boutique investment firms and middle-market banks, which typically handle transactions below $1 billion, are finding themselves in an enviable position this summer. As the big financial firms tighten the number of internships and job offers they are giving to MBA students, smaller firms that often get overlooked by MBAs during the job hunt are suddenly in demand. In response, many are increasing their hiring quotas and becoming increasingly selective about candidates they do decide to hire.

"The smaller shops are realizing this is a great time to pick off talent," says Jeff Fischer, director of the career management center at University of North Carolina at Chapel Hill's Kenan-Flagler Business School. "I think an average MBA interested in investment banking is thinking he or she may need to look more broadly and I think the boutique firms will capitalize on that."

Expanded Horizons

The move comes as career-services officers like Fischer are encouraging students to broaden the scope of their job searches to include financial companies they may, in the past, have overlooked. While the early job outlook for the fall does not look dire—schools are reporting full recruiting schedules and most large firms said they plan to be on campus—there is still lingering uncertainty about the stability of the MBA job market, according to conversations with half a dozen MBA career-services officers around the country. Apart from jobs that evaporated when Bear Stearns (BSC) was absorbed by JPMorgan Chase (JPM), most companies have not rescinded job offers to 2008 MBA graduates, though some schools have reported isolated incidents of promised jobs being pulled.

"There's a general anxiety among students now. I don't think anyone trusts any of the companies, whether it's an investment bank corporation or a commercial bank. Anything could happen," says Patrick Perrella, senior associate director of MBA career development at University of Notre Dame's Mendoza College of Business. "We had a job offer rescinded from someone in the automotive industry, so certainly there is risk across all the industries this year."

Hiring Caps?

Still, most companies, including those in the investment banking industry, said they plan to go forward with business as usual this fall. "We are back on campus in the fall for 2009 recruiting because the analysts and associates are our 'pipeline' for officer levels in three years," Elizabeth Wamai, head of global campus recruiting at Merrill Lynch (MER), said in an e-mail.