IB During Recession

I dig the username. I hated the GMAT too.

Anyhow, it's not impossible, but it's going to be extremely difficult.

In the past, the bulge bracket firms scooped up the majority of incoming associates:

Goldman
Morgan Stanley
Merrill
Citi
Lehman
JP Morgan
Credit Suisse
UBS
Bear

Three of them no longer exist (Merrill, Lehman, Bear). Rumors that BofA bought Merrill purely for its brokerage and asset mgmt units, and may simply disband Merrill IB altogether. Citi is approaching zero equity (it was trading at $3/share yesterday?).

Investment banking as a job function will likely continue to exist, but how the industry is organized/structured is in flux right now -- especially when certain banks still have concerns about solvency (Citi in particular).

You may have to be realistic and look at the regionals (who hire in smaller numbers anyhow so the competition will be very stiff) - at places like CIBC, RBC, Wachovia (if they don't go under), and so forth. Boutiques like Lazard, Greenhill, Blackstone, etc. won't hire newbies as they will fill their incoming associate class with ex-IB analysts with M&A backgrounds.

Plus, with cutbacks at all banks, there's simply less spots to fill across the board. They're not going to magically hire people in huge number anytime soon until the industry sorts itself out. The next few years will be spent on reform of the financial industry - from how these firms are organized, to regulations. Until that reorganization is well on its way, you're simply not going to see much job growth in this area. Uncertainty of what the business is even going to look like is the best way to kill any thoughts of expanding headcount. And this kind of thing doesn't take 1-2 years. Try 3-5 years realistically. The financial industry isn't going to die, but it's not like it's recovering from a minor head cold. It's more like recovering from a near-death bout of pneumonia.

There will be less jobs, but not necessarily less "demand" from students - because when times are tough students don't have the option to "choose" what they want. They will apply for openings wherever they can get them.

In short, you need to look at other options as well outside of IB (or even outside of finance altogether) if you want even have a job at graduation. I don't want to scare you, but it's wishful thinking to assume that the job market will be "healthy" by 2011 given the structural changes that are happening in financial services right now. In this environment, you just have to be realistic about finding *something* that will put food on the table and keep the lights on.

And this has nothing to do with whether you're going to Tuck or any other b-school. Frankly, when you're an employer and you're sh*t scared about going under, you won't give a sh*t about b-school reputations - they really don't care about "maintaining their relationships with the schools". MBA students and b-schools in terms of relationships are near the bottom of their priority list when times are rough. Put it this way. They royally screwed the b-school students at ALL top b-schools between 2001-03 by reneging on offers, firing recent grads with little severance, etc. The recruiters were more concerned about saving their own asses - the last thing they could care about is pissing off the universities. So you had HBS grads moving back with their parents, Stanford grads unemployed for 18+ months, Wharton grads going back to their pre-MBA jobs, etc. And you know what? It has no effect whatsoever on the MBA-recruiter relationship even in the short-term. By 2005 onwards, the MBAs were back in force clamoring to get into these banks and consulting firms and b-schools were more than willing to accommodate, as if getting royally screwed a few years earlier had never happened.

Right now, the employers/recruiters have all the power. They can completely d*ck you around with no consequences - 5-7 years later the next generation of MBA students will still clamor for these same kinds of employers.

That's why when you go to any recruiting event in b-school, take everything these folks say with a GIGANTIC grain of salt.

If you really want to banking, by all means go for it, but be fully prepared to look at other non-finance jobs.