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Finance vs Tech firms: The Competition for Graduate Jobs is Fierce


The Times Top 100 Graduate Employers for 2020-2021 includes a large proportion of investment banks, featuring prominent names such as J.P Morgan, Citi, HSBC, Morgan Stanley, and Goldman Sachs. This comes as no shock. The hunt for entry-level jobs, especially in industries that grow more competitive by the year, is flooded with big corporations, consulting firms, and investment banks.

The competition has now reached an entirely new level. Employers featured on the list cut their graduate recruitment by 15.1% in 2020, inciting a fiercer era of competition. It is clear that college and university graduates around the world are relentlessly competing amongst themselves.

Evidently, tech giants and the biggest investment banks worldwide are the world’s top employers for new graduates for a reason – they offer job stability and lucrativeness. High beginning salaries only hint at the benefits of working at such businesses.

The safety of working at high profile, well-established corporations, in addition to the prospect of climbing their ranks one day, is very alluring. More importantly, it is very impressive: it is a huge accomplishment to be hired by one of the world’s most powerful businesses – a process that is undoubtedly backed up by hard work, sweat, and possibly some tears.

Credit: IBM

Based on a U.S study of 5.2 million applications on Handshake, a “LinkedIn” for colleges and universities made to connect 9 million students with 250,000 employers, college students apply for more entry-level jobs at IBM, JP Morgan, Amazon, and Tesla than at any other companies. Almost unsurprisingly, the rest of the list features names such as Microsoft, Facebook, McKinsey, PwC, and Apple.

It is clear that an abundance of new graduates aim to work at well-established firms in either the technology or finance sector, both of which uncoincidentally have the biggest grasp on colleges and universities worldwide.

It does not seem so farfetched to say that there is competition between the two sectors. However, the fierce competition between ambitious graduates is irrefutable.

A question that many college and university students ask themselves is one laced with anxiety and fear for the future: will the job go to a student at a more exclusive or better university? Or similarly, how important is it to graduate from a prestigious university?

Comparing the Investment Banking Giants: J.P Morgan, Goldman Sachs, and Morgan Stanley

For aspiring investment bankers, roughly 60% to 80% of university graduates are drawn from a list of “target schools” where investment banks focus their recruiting efforts. For example, this may be through the attendance of job fairs or the pursuit of undergraduate internship opportunities.

Overall, these three firms clearly pick from a very daunting list of universities, mostly from top schools in the U.S and in the U.K. Morgan Stanley is the least ‘elitist’ when it comes to hiring from Ivy League schools and seems to recruit from a larger pool.

Perhaps Morgan Stanley places less value on the school name and more on the experience, or perhaps Harvard, Oxbridge, Princeton, and Stanford graduates lean more towards Goldman Sachs and J.P Morgan.

Harvard University

One thing we can say with certainty is that Morgan Stanley recruits mostly from New York University, and although it is not on the same status as Harvard or Oxford, it is certainly a top school that is less exclusive than the universities mentioned above.

Meanwhile, Goldman Sachs employs nearly twice as many Harvard graduates, and just like J.P Morgan, obtains most of its recruits from the London School of Economics.

The overarching conclusion is that these three firms share a strikingly similar taste when it comes to recruiting from universities – their top 25 universities are almost all virtually the same.

Comparing the Tech Giants: Amazon, Google, and Apple

These three technology companies hired intensely during the 2020 financial crisis, which is not necessarily odd considering that Apple and Google also pushed ahead with recruitment during the 2008 financial crisis. Secondly, the data available on who exactly they hire and from what universities is extremely limited, unlike the finance sector.

Historically, however, Silicon Valley tech companies hire mostly from the top schools in California such as UC Berkeley, USC, and Stanford. Outside the state, they also typically hire from CMU and UT Austin.

It is clear why the tech companies hired the way they did during the pandemic, as covid-restrictions did not affect the tech industry in the same way that they affected others. In fact, in many areas, people switched to tech as a replacement from traditional forms of work and communication.

Photo Of Code Projected Over Woman

In the face of a recession, the tech giants have managed to carve out increased graduate opportunities, which is a sentiment to how resilient they can be in times of economic downturn compared to their financial counterparts.

Is There Competition Between the Technology and Financial Sector for Top Graduates?

There are a few things to unpack here. The most important and obvious point is that these industries select most of their recruits from top schools, with these predominantly being universities in the U.K and U.S.

This does not mean that most hires are American or British. It is important to keep in mind that these world-class universities are international and have a percentage of international students, and so although a graduate may have a U.S or U.K diploma, they might share a different national identity.

This competition does not mean that these industries do not need each other. As financial technology explodes, the demand for more tech-based skills and services skyrockets. On the other hand, huge tech companies such as Amazon and Google require a wide range of services including business and financial analysis.

In both tech and finance, there is a requirement for employees across both areas. For example, Morgan Stanley is an investment bank but hires a substantial number of tech engineers.

Credit: Bloomberg

Since top employers have such a need for employees in both finance and technology, perhaps the competition is not so fierce between the ‘giants’ as it may seem.

Most new graduates apply for numerous jobs in many different companies; top graduates looking to get hired by top companies may be almost impartial between Amazon and J.P Morgan. More notably, there are plenty of ambitious, talented students who dream of working for a big corporation.

Yet there are not so many giants, hence the name ‘giants’.

The competition is in the labour market, and the growing competition to enter the top universities in the U.S and the U.K is arguably the fiercest of them all, mainly because the educational institution is often a key factor of employability.

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