Job Prospects In Finance Could Plummet Nearly 60% For The Next Class Of MBAs
Business school grads face the most uncertain career prospects of all degree holders, the report finds. The hiring market for MBAs is expected to contract by nearly 25% in the coming year, weighed on by the sharp drop in finance hiring and a projected 86% plunge in government opportunities.
The report proposes that employers tend to hire fewer MBAs during periods of economic uncertainty. It says one common pattern is for employers to substitute MBA hires with cheaper bachelor's degrees, in order to cut short-term budget risks.
All finance hiring was initially expected to expand in 2012-2013, but dipped at the start of this year, according to the report. "The job market has soured with layoffs and hiring contractions because of increases in interest rates, declines in mortgage activity, growth in online banking, and new banking regulations," it says.
MBAs may already be taking note. A report by the Wall Street Journal earlier this month found that the percentage of business school grads going into finance slid 12% at Harvard and 13% at Stanford over the past two years. Meanwhile, a record number of the elite graduates headed to the tech sector.
And while MBAs are expected to be among the hardest hit the finance hiring pullback, the Michigan State report suggests the sector isn't particularly promising for anyone. The industry as a whole is expected to cut hiring by 40%, with prospects for bachelor's degree holders falling by up to 27%.