The scandals aren’t just affecting Wall Street’s bottom line — they're also hurting the ability to attract new recruits, The New York Times’ DealBook said Thursday.
After going to college in a world thrown into a financial crisis, recent grads are choosing to look past the high-paying world of Wall Street to save themselves from writing public resignation letters bashing their companies for sucking profits out of their “Muppet” clients.
The numbers are obvious. In 2008, 28% of Harvard’s graduating class went into finance. Three years later, that number fell to 17%.
So where are these people going? Technology.
According to DealBook, a 2011 Universum survey of 6,700 young professionals ranked Google, Apple and Facebook as the most-coveted workplace, while the highest-ranking bank, JPMorgan Chase, came in at No. 41.
The lack of creativity, fulfillment and the social stigma of the finance industry seem to be the biggest reasons for the exodus, though I wonder how long that will stick around once these college grads have to start paying off student loans.
Lucrative jobs on Wall Street may seem like a sellout, and call me a cynic, but they won’t stay open for long. Once the startups these grads are flocking to start to fail or the debt collectors come calling, the doors of Wall Street will seem much more appealing ones to open.
Right now, unemployment for those 20 to 24 years old is at almost 14%, according to the Bureau of Labor Statistics—about double the national average. I bet the folks in that rather large percentage would love to take those jobs Harvard grads are passing up.
Plus, average student loan debt topped $25,000 last year, so Wall Street may not satisfy the soul, but it'll surely fulfill the need to pay off loans before the spirit-crushing interest kicks in.
The industry will also — at some point — swing out of focus and back into the background. It will probably slowly start to happen now that the Occupy movement is dying out and the industry is paying major bucks in penalties and lost investments, and doing some reform while they're at it (even if it's at the hands of the government). Bad headlines can't last forever.
Sooner or later, these students will be back. Just give it some time, and a few overdue notices on student-loan payments.