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Over at Poets & Quants, author John A. Byme details the heart-wrenching break up of Harvard Business School and Wall St. It wasn't long ago that HBS was cranking out financial industry professional after financial industry professional, as noted by Byme:

Just before the collapse of such venerable Wall Street names as Bear Stearns and Lehman Brothers, the financial sector hired a whopping 45% of all the MBAs Harvard could produce.

Whopping indeed! But, alas, much like Romeo & Juliet, Othello & Desdemona, and Antony & Cleopatra, the love affair was so intense that someone had to go and commit suicide.

This year, only 27% of Harvard's Class of 2013 ventured into financial services, the lowest percentage of grads in memory, according to a recently released preliminary employment report.

However, the question remains, who broke up with whom? I think we can all agree: it's never mutual.

Luckily, Byme gives us some insight in to who was the one to say, "look, we need to talk":

It's as if Harvard Business School has walked away from Wall Street. Some of the biggest declines have occurred in investment banking and investment management as well as private equity and leveraged buyouts, the latter of which paid the highest starting salaries this year. Only 5% of Harvard's Class of 2013 went into investment banking, down from 10% in 2011. Only 5% landed jobs with investment management firms, down from 12% in 2011. And this year, 9% of Harvard's MBAs went into PE and LBO firms, down from 15% last year. Venture capital, which took 4% of the graduating MBAs from Harvard back in 2008, is now down to hiring just 1% of the class.

For those of you pondering an MBA, this is pretty important. At first look, this appears to be a situation where HBS broke up with Wall St. with a text message. But, upon further inspection, it looks far more familiar to the common college relationship, where after you initially break up, you continue hooking up periodically for a while thereafter.

So, "why now?" you may be asking. Well, like many college relationships, it appears that after HBS initially broke up with Wall St. back in 2009, they started seeing someone else. Consultants.

I know it's tough when someone you love moves on, but don't worry Wall St., Wharton still loves you!

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Comments (22)

  • Stryfe's picture
  • Pepper's picture

    I feel like the statistics are a bit skewed. It's obvious that more people would be working for tech companies now than even 5 years ago, but it's not like they're programmers there. They're probably working under C-level executives, or in corp dev/strategy. It's not like people go to HBS to go into computer science or engineering.

    Also the first set of areas does not include entrepreneurship, which can still be considered part of finance. I'm assuming these jobs are qualified as "tech", again providing a potential source of shift of job areas.

  • mbavsmfin's picture

    Everybody knows that finance has declined in terms of MBA recruiting, but top MBA grads are still kicking ass and taking names. Entrepreneurship is the hot thing at HBS, so a lot of the students are doing startup. Also a ton of them are now doing product management or corp strategy at major tech firms such as google/facebook/amazon. And HBS students in general have no desire to do sellside.

  • Tommy Too-toned's picture

    Looks like the street's been getting fucked. At least the physical attraction's still there.

  • ElRusoAdomaitis's picture

    I think finance has been replaced by start-ups but I wonder: when the street starts paying again are the product managers at Square and Amazon going to try to get back in the game? Personally, I see a lot of people doing the product manager role at start-ups, from their description sounds like a glorify scheduler lol

  • In reply to ElRusoAdomaitis
    mbavsmfin's picture

    I think so. During admit weekend I was amused at how many ex-finance guys were planning on doing a "startup" or going into tech. Although they did not state it explicitly, I'm pretty confident that in most cases it's because they were unable to get the buyside gigs they wanted. If you're a finance guy at one of these schools, you're going to pick a job at say kkr/blackstone/perry/york/paulson/och-ziff, etc., over tech/startups the vast majority of the time.

  • atomic's picture

    Can't say I'm terribly surprised. Most MBA folks I know have dogmatically followed the rulebook their entire life. At this particular moment in time, the rulebook is saying, "Go work for a start-up! You're special!" In 2005, the rulebook was saying, "Go work on Wall Street! You're special!"

    Which brings me to today's Monkey Lesson: Do what what you want to do. You're allowed to want to work at a start-up. You're allowed to want to work in finance. But make sure you're the one doing the wanting. Living someone else's ideas of success is about the least successful thing you can do.

    Not that I'm, ahem, implying anything about this year's crop of HBS grads, who I am sure are all wonderful, perfectly unique snowflakes.

  • FormerHornetDriver's picture

    SB for you atomic on that first paragraph. This is very true and startups are the 'in' thing to do now.

    Money is also a factor as well. Before the crisis, a VP at a bulge bracket could pull in well over $750K in a good year, while now they are making closer to $500K, all in. $500K in NYC is just not that much money to do a job like IBD, especially after three years as an associate. When the money comes back, so will the numbers. As anyone else who has worked in this job will tell you, the threshold for pain is directly related to the number that shows up in your bank account come February 15th. If what the analysts just finishing their first year got paid is any indication of what's to come, I would bet you see the numbers improve over the next few years.

    The other thing to note is that elite B-schools are changing their entire model, both in terms of who they recuit and what they are training them for. The Top-15 schools took a look at themselves and decided they did not want to just be pipelines for Wall Street and Consulting. They are actively recruiting folks from all kinds of diverse backgrounds that they previously ignored. My class in B-school (a top 10) had artists, diplomats, music producers, teachers, etc. Every business school is currently jockying to see who starts producing the big wave of start-up success stories.

  • TDSWIM's picture

    I'm not considering an MBA right now, but if I was, I'd see MBA schools bringing in other candidates as a good thing. It's probably easier to land the finance jobs if fewer classmates are going for the same OCR spots.

  • DCDepository's picture

    FormerHornetDriver:

    SB for you atomic on that first paragraph. This is very true and startups are the 'in' thing to do now.

    Money is also a factor as well. Before the crisis, a VP at a bulge bracket could pull in well over $750K in a good year, while now they are making closer to $500K, all in. $500K in NYC is just not that much money to do a job like IBD, especially after three years as an associate. When the money comes back, so will the numbers. As anyone else who has worked in this job will tell you, the threshold for pain is directly related to the number that shows up in your bank account come February 15th. If what the analysts just finishing their first year got paid is any indication of what's to come, I would bet you see the numbers improve over the next few years.

    The other thing to note is that elite B-schools are changing their entire model, both in terms of who they recuit and what they are training them for. The Top-15 schools took a look at themselves and decided they did not want to just be pipelines for Wall Street and Consulting. They are actively recruiting folks from all kinds of diverse backgrounds that they previously ignored. My class in B-school (a top 10) had artists, diplomats, music producers, teachers, etc. Every business school is currently jockying to see who starts producing the big wave of start-up success stories.

    Agree with all of this. I've noticed the same thing about who the top programs are recruiting. I've seen a lot of the resumes of MBA classes and, truth be told, the majority are total jokes. It's like recruiting CPAs to masters programs in international development. The MBA programs have got it in their head that business school is no longer about business. When the business programs ultimately realize that foreign service officers, 22-year-olds, and people who are interested in non-profits (remember, this is BUSINESS school we're talking about...) aren't giving the same kinds of monetary returns to the programs as before then things will start shifting back.

  • Cash4Gold's picture

    This is the most bullish news I have read in a long time

  • mongoose's picture

    Check out the profiles of the Class of 2014 students. You would think they went to the Harvard School of Social Work by reading their stories.

  • WalMartShopper's picture

    also i think its not that hbs grads dont choose finance as much, but that the competition internationally and regionally is getting a bit stiffer.

    If the glove don't fit, you must acquit!

  • SirTradesaLot's picture

    Cash4Gold:

    This is the most bullish news I have read in a long time

    Was thinking the exact same thing,

    adapt or die:
    What would P.T. Barnum say about you?

    MY BLOG

  • UFOinsider's picture

    Less people, Harvard included, went to Wall Street in 2008 because things kind of hit the fan, and people moved to consulting to make money off of bank restructurings. This seems self evident. When/if finance picks up, more Harvard people will go to Wall Street because 1) banks will be hiring more people and 2) there will be more money to incentivize people.

    Get busy living

  • DCDepository's picture

    UFOinsider:

    Less people, Harvard included, went to Wall Street in 2008 because things kind of hit the fan, and people moved to consulting to make money off of bank restructurings. This seems self evident. When/if finance picks up, more Harvard people will go to Wall Street because 1) banks will be hiring more people and 2) there will be more money to incentivize people.

    Uhh, have you seen a recent Harvard MBA resume book...? I don't think many of those people would have the credentials or the knowledge to move onto Wall Street post-MBA. You're also seeing a trend of Harvard picking out 22- and 23-year-olds and bringing them into the program. I think what you'll see is evolution of the street away from programs like that as Harvard gains the reputation of spitting out non-value-adding talent to the finance industry.

  • WallStreetPlayboys's picture

    atomic:

    Can't say I'm terribly surprised. Most MBA folks I know have dogmatically followed the rulebook their entire life. At this particular moment in time, the rulebook is saying, "Go work for a start-up! You're special!" In 2005, the rulebook was saying, "Go work on Wall Street! You're special!"

    Which brings me to today's Monkey Lesson: Do what what you want to do. You're allowed to want to work at a start-up. You're allowed to want to work in finance. But make sure you're the one doing the wanting. Living someone else's ideas of success is about the least successful thing you can do.

    Not that I'm, ahem, implying anything about this year's crop of HBS grads, who I am sure are all wonderful, perfectly unique snowflakes.

    This is pretty much it right here.

    At this point the only way to make money nowadays is 1) start up / valley money, 2) business owner and 3) Wall Street.

    Most other professions are effectively dead, the hyper competitive people will flood start ups and the street.

    WALLSTREETPLAYBOYS.COM

    TWITTER @WALLSTPLAYBOYS

    Advice from Real Wall Street professionals.

  • jzd2013's picture

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  • BankingWaffle's picture

    Cheers.