Millennial MBAs shun finance industry, look to tech careers
Wall Street's reputation for demanding long hours of employees, particularly young ones, does not sit well with today's young professionals.
If you want the make the big bucks, banks might be the best bet. And yet, that’s a bet that an increasing number of young people are passing up on.
Traditionally, banks have been the most popular employer for those with degrees from the best business schools. In 2012, 36 percent of those who graduated from the top ten MBA programs went into finance after graduation.
Last year, however, finance only attracted 26 percent of those elite graduates. A larger share (29 percent) opted for careers in consulting, according to an analysis by the Wall Street Journal. The tech industry is also gaining in popularity, attracting roughly 20 percent.
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The financial sector has responded by raising starting salaries. The median starting salary for graduates of top business programs who went to work for banks rose from $100,000 to $125,000 over the past five years.
Among tech and consulting firms, the median starting salaries only rose by 9 percent. Elite MBA grads who go into consulting enjoy a higher median starting pay of $147,000. In tech, it’s the same as finance: $125,000.
In addition to pay that is comparable to banking, tech lures top talent with the promise of a better work-life balance. Wall Street is notorious for demanding long hours of employees, particularly young ones. Tech firms, meanwhile, have become associated with laid-back workplaces and generous vacation and family leave policies.
“You can have a lucrative career without those lifestyle costs,” Jean Ann Schulte, director of employer relations and recruiting services at the MIT Sloan School of Management, tells the Journal.
Attempts by Wall Street firms to reduce the work burden on young employees have only underscored the workaholic culture. In 2013, Goldman Sachs announced that junior employees would be encouraged to no longer work on Saturdays –– but said nothing about Sundays. Shortly afterwards, J.P. Morgan Chase similarly announced that it would ask its employees to reserve one weekend a month as “protected” from any work requests.