Would-Be Bankers Turn to Consulting

As the banking industry struggles, many MBA job seekers are considering switching their sights

By Alysa Teichman

With the banking industry in crisis, many job-seeking MBAs—especially those who once dreamed of lucrative careers in investment banking—are rushing to broaden their options by applying to consulting firms. And while it means more competition for jobs in that sector, for the firms doing the hiring, it means a more robust crop of candidates to choose from.

Turnout at campus presentations this fall by consulting firms is up from last year, recruiters say. "We've seen attendance double at some campus venues, even people sitting on the floor," said Kermit King, a senior partner who heads recruiting in the Americas for Boston Consulting Group. "We think this reflects both the relative attractiveness of consulting as an industry and the relative strength of BCG within the industry in these tough times."

Varied Backgrounds

Consulting firms have historically shared talent with investment banks because the two fields demand many of the same personal attributes: analytical skills, quantitative ability, and a strong personality. However, some key differences exist between prototypical bankers and consultants. "From what I understand about the big financial firms, they do look for real previous banking experience, whereas we look for a variety of backgrounds and skill sets," said Nikki Rath, the senior manager of campus recruiting and diversity initiatives at Booz & Co.. "We have a lot more nontraditional people who have run dance companies and who have been actresses and athletes—they're all different aspects that hold the capability set."

But the nuanced differences between bankers and consultants aren't stopping would-be bankers from crossing over during this fickle job-application season, especially when the future of individual companies is by no means certain. Rath said she has encountered a spike in candidates who spent a summer working at Goldman Sachs (GS) or had an offer at Wachovia (WB), for instance. "We have definitely seen an increase in résumés that had a lot of banking on them," Rath said.

Jackie Wilbur, director of the career development office at Massachusetts Institute of Technology's Sloan School of Management reported increased interest in consulting jobs among students. Attendance levels at two firms' career presentations were up 20% from last year. Wilbur also says 20% more second-year students will be applying for strategic consulting jobs than last year.

Sets for a Long Slog

Typical of those looking into consulting is Kris Ter-Ghazaryan, a second-year at Northeastern University's College of Business & Administration, who said the job situation is worrisome. She's still seeing banking job postings online, but the daily news reports indicate something different—job cuts. As a result, she is looking into consulting for companies going through reorganization, a niche she thinks will grow in response to structural changes in the economy.

"I'm not nervous about getting a job in general," Ter-Ghazaryan said. "But I know it will take a lot more effort right now. I'll have to do a lot more work and much more networking than if things were better in the economy."