What will 2010 be like for MBAs coming onto the job market? As the world anticipates a recovery, David Williams looks at the way employers have changed their recruitment practices since the onset of the recession.
The first characteristic of recession-era recruitment is that it takes much longer to secure a job. The glut of candidates means that employers can afford to take their time to consider exactly what and whom they need. Alongside this, a natural caution about incurring additional costs means that they are inclined to delay committing until they are convinced of the value a new or replacement employee will bring to their business.
John R. Ferneborg, Senior Partner and Co-Founder of the Ferneborg Group in California, one of the 150 most influential head-hunters in the world according to Business Week, says: The entire hiring process at every level is taking longer because everybody is skittish that they don't want to make mistakes, he says.
As employers seek to minimize risk, they are naturally drawn to experienced candidates from their own industry or sector, people whose CVs they understand well. Depth of experience has therefore become a vital component of success. A survey of 350 UK recruiters by SHL, the talent-assessment solutions provider, shows that sixty-nine percent of employers say that experience is the most important attribute they are looking for during the recession.
The QS TopMBA.com Salary and Recruitment Trends Survey for 2009 also reveals a marked increase in the preferred levels of work experience for new MBA hires. According to the report, candidates with five to eight years of pre-MBA experience have seen a surge of interest, with the percentage of employers targeting them increasing from 13% in 2008 to 35% in 2009. In contrast, employers looking for candidates with between one and three years of experience have dropped from 34% to 17%. This rush by employers towards the safety of experience has had two effects; first, it has made securing employment much more challenging for those using an MBA to switch careers.
Jim Clayton is Director of the Graduate Career Management Center at the W. P. Carey School of Business at Arizona State University. The emphasis on experience makes it very challenging for career changers of course, he says. They will eventually be selected but only after all the experienced candidates have been taken.
The second effect of the requirement for experience is, according to the QS report, the way it has pushed the least experienced MBAs back into the graduate jobs market. This is an environment with its own challenges and some employers are expressing concern that over-qualified candidates may simply be using them as a stopgap. According to the survey, one-fifth of recruiters are worried about receiving applications from candidates who are only looking for somewhere to weather the storm until the market improves. However, while not insignificant, one-fifth is not a large proportion. It may be that modern employers are so used to the idea that talent is mobile that they are prepared to reconsider over-qualification as an opportunity to bring top talent into their company at a greatly reduced cost.
Such is the competition, one of my local employers told me recently that for the first time ever he has been getting applications from MBAs from Ivy League schools, adds Clayton. But I don't think it is really a problem for everyone. If you are a recruiter, your job is to bring in the best quality candidates you can. Keeping that individual in your company and ensuring his or her ongoing employment comes down to a whole different group of people.
A third characteristic in MBA recruitment has been a prevailing attitude of extreme caution among recruiters, headhunters and careers advisors, at least in their public statements. Driven by a realisation of how close the world came to financial collapse and by uncertainty as to the depth of the recession, experts have kept their expectations low. However, as the QS report states, the effects of quantitative easing and bank bailouts has been to protect financial services, one of the primary sectors for MBA hiring.
Allied to this has been a counter-cyclical demand for consultancy services, which have been put in place to help firms respond to the consequences of the downturn and to prepare them for the recovery when it comes. Both factors have shored-up MBA hiring in a way that no one anticipated at the start of 2009. Hayden Estrada, Associate Dean at Boston University is quoted in the QS report saying he feared only fifty percent of graduates would be in employment three months after graduation, while the reality is that over eighty-five percent have found employment.
Looking again at the SHL survey, apart from experience, the other leading factors are as follows. Sixty-one percent were looking for greater competencies. Forty-six percent wanted to see more enthusiasm, while forty-two percent were emphasising cultural fit.
For Clayton, it is the ability to answer the tell-me-about-yourself question that gives his MBA graduates the best chance of success. We frame the answer in three ways: motivation plus enthusiasm, skills match and cultural fit, he explains. First, do they have a really good reason to explain why they are there in front of that company? Secondly, do they have the skills? This means getting them to go through that job description and making sure they can say to employers that these are the skills you want and these are the skills that I bring. And last but not least is their fit to the organization. How will they fit in? In order to respond to employer expectations, we make sure that every candidate has an answer to all those questions.