In today’s society, there is a well-established prestige pathway. If you attend a high-ranking university, it’s very likely you’ll end up with a job in consulting and/or investment banking.
In 2017, nearly 40 percent of Harvard graduates took consulting or finance jobs. That statistic remains equal or higher across other Ivy League universities. Most of these graduates end up at the so-called top firms. In consulting, that’s McKinsey, Bain, BCG; in finance, it’s Goldman Sachs, Morgan Stanley, JPMorgan.
This means thousands of the brightest, most hardworking (and privileged) young adults are going to work for only a handful of firms every year. That’s a ridiculously high percentage of graduates concentrated in a couple of industries.
Over decades, these firms have thoroughly and meticulously infiltrated and transformed the culture of these universities, resulting in a staggeringly high conversion rate of graduates into their ranks. As a result, fewer candidates are left for other fields that need them, such as healthcare, education, energy, and environmental science. It’s a very real — and very damaging — brain drain.
Even worse, most of these students have no idea what they’re getting into. They’re doing it because of the prestige; landing one of these jobs is seen as the pinnacle of a status culture in which they’ve been immersed. Although many leave after about two years, driven away by the long hours and cutthroat culture, some stay far longer. Eventually, they realize that prestige and overachievement are no longer as important as when they were younger — but by then, they’re trapped.
To understand this pattern, we must first understand the average student on the prestige pathway. Meet Alice.
From a very young age, Alice is groomed to work hard and told she can achieve anything. She is at the top of her class, the leader of her school clubs, the perfect standardized test taker, the best instrument player, a solid athlete, and the one with just the right amount of volunteering experience. From testing to summer programs to college applications, she has ascended the ladder of our status culture and educational system. She’s jumped through all the impossibly high hoops and done exactly what today’s young high achievers are supposed to do.
Now, Alice is in college. Everything’s a lot more free-form: Her schedule is more flexible, and she has a vast amount of choice among courses, internships, positions, clubs, and fields. She’s also in a completely new environment. She was at the top of her class in high school, but here she is one of many high achievers. She flounders a bit, changing her major at least once, struggling in some classes, indulging some bad habits.
Alice doesn’t really know what she wants. She has spent her life doing what she is told because she’s an achiever. But now that she has real choices, she’s scared. What happens if she chooses the wrong major or takes the wrong job? What if she doesn’t like her path?
There is no right answer. Alice’s life is not like all the tests she used to ace.
Now, imagine: What if Alice could find a career that kept her options open? One that gave her skills she could apply anywhere, that boosted her resume to make her even more employable after college? A career that also paid her handsomely and put her in close contact with some of the smartest and most hardworking people she might ever meet? One where everyone tells her how accomplished she is or nods in approval?
That’s the prestige pathway of industries like consulting and finance. That’s the promise they make, the allure they create, and the status they symbolize.
Surely there must be a better place in society for a computer science Ph.D. than a hedge fund’s tech department.
But Alice doesn’t discover this when she’s a job-hunting senior. These firms start recruiting and marketing as early as freshman year on college campuses, when most students have never even heard of most of them — unlike their senior counterparts, who can rattle off the differences among the major management consulting companies off the top of their heads.
The campus is steeped in the influence of these firms. “Successful” alumni proudly parade their experiences in these fields and pass on stories and opportunities to their friends. Seniors are fully engaged in job searches and constantly prepping for interviews. Juniors are interviewing for the summer internships that will hopefully guarantee them offers the following year. Even the freshmen and sophomores are encouraged — by their friends, career services, and professionals — to do case competitions, internships, coffee chats, and the like so they can get in the good graces of these firms.
Once you are on the prestige pathway, there is no time to consider other options.
Entire student organizations — like the undergraduate consulting club or a student investment committee — are created to shuttle high-performers into these companies. Concentrations and majors like economics are major pipelines into consulting and finance, which results in disproportionate numbers of students pursuing these fields of study at top universities. Even the physical infrastructure of some campuses is designed to suit these companies (for example, there’s a Goldman Sachs room in Columbia University’s career services office).
The so-called “dismal science” of economics has been one of the most popular majors at Harvard, Yale, and Princeton for many consecutive years. For decades students have treated economics departments as a step toward jobs on Wall Street and in consulting.
With all these pressures combined, it’s no wonder Alice is enticed by potential offers. She can’t avoid the influence, especially during the fall recruiting season, when everyone on campus is talking about McKinsey and Goldman. Most of Alice’s friends don’t even know why they’re interested in these fields, aside from the perception that these prestigious careers are the next rung on the ladder.
So, Alice joins them.
As Kathy Cheng, MIT graduate and Venture for America Fellow put it:
When I was growing up, everyone told me to work hard so that I could get into the best colleges and universities in the country. They told me that once I graduated from one of these top-tier schools the world would be open to me. So I aspired, and I got into MIT, arguably one of the best universities for science and technology in the world. However, when those daunting junior and senior years rolled around, when it came time to seriously consider what I wanted to do after graduation, I felt none of that freedom, none of that empowerment. Instead, I felt locked into a choice few “successful” career paths, and for me those manifested as finance and consulting.
And once these graduates start working at these firms, they get what they were promised: prestige. The actual job, however, involves a lot of tedious number crunching on Excel, endless versions of slide decks that contain minute errors hastily corrected to suit the partner’s or client’s needs, and loads of other mundane tasks. But that doesn’t matter. It’s what these students wanted.
And this begs the question: What’s wrong with chasing prestige?
It comes down to value creation. That’s ostensibly the role of universities: to create value for society. The aforementioned firms, however, don’t create value as much as they capitalize on value that others have already created. As Andrew Yang, founder of Venture for America, states in his book, Smart People Should Build Things:
Professional services industries like finance, consulting, and legal services are, by definition, meta-industries. That is, they serve to help large companies raise money, buy and sell each other, reorganize, implement new systems, conduct complex transactions, and so forth. They are dependent on companies coming into being and becoming big enough to hire them.
Imagine a country that poured the majority of its resources into consulting and finance as opposed to research and development, new ventures, and new infrastructure. You’d certainly get a lot of great powerpoint analyses, but probably not much else. Currently, we allocate the greater portion of our top talent to financial services and the like, many of which are “socially useless,” according to the chairman of the United Kingdom’s Financial Services Authority. These jobs focus more on transaction costs and less on creating new goods and services.
The competition for top talent at the university level is fierce, and the companies with the most resources generally win out. According to a study on elite professional service firms, like consulting companies, conducted by Professor Lauren Rivera in Harvard Business Review, a single firm budgeted close to $1 million annually for social events on one college campus. Graduate biology students are being courted by more management consulting firms than pharmaceutical or biotechnology companies. Surely, there must be a better place in society for a computer science Ph.D. than a hedge fund’s tech department.
Even if the nearly 40 percent of graduates may not be doing something actively bad, they are passing on the opportunity to be the citizen-leaders our societies really need. There are countless unresolved issues regarding basic human rights and justice, in the US and every other country in the world, that desperately deserve attention from those with the various capacities to tackle them.
Most students look for the easiest opportunities with the lowest risk. And when these firms are quite literally wining and dining them, they might just miss the nonprofits and small startups doing quietly groundbreaking, meaningful work.
In a world that values skill-building and ever-evolving career growth, college graduates are attracted to the promise that these firms will teach them skills they can apply anywhere.
However, it’s unclear whether working at Goldman Sachs or Boston Consulting Group will teach you to be anything but a better banker or consultant. And contrary to popular belief, exciting companies with great opportunities are not generally reaching out to banking analysts, consultants, or corporate lawyers. If these people do end up changing careers, it’s usually after attending graduate school or another educational program, like a coding bootcamp, to preserve their signaling value. The promise of leaving doors open for other careers isn’t realistic.
It’s pretty hard to switch to a more “exciting” job that doesn’t pay nearly as much.
And while these firms lure students in with the generous salaries and trendy offices, these status symbols often come at a cost. It’s difficult to demote your lifestyle once you’ve become accustomed to it. When you’re rocking a high six-figure salary and steadily contributing the highest amounts to your retirement accounts, wearing well-made clothes, living in a well-appointed apartment, and buying most of the things you want whenever you want them, it’s pretty hard to switch to a more “exciting” job that doesn’t pay nearly as much. This phenomenon is known as the golden handcuffs.
Additionally, many young people move ahead in prestige careers simply because they believe these jobs are as good as it gets. The benefits are worth it, and they’re often paid to travel the world (through consulting gigs, especially). But once the excitement of prestige wears off, many realize that the job itself is not what they were expecting. And that’s how we end up with a bunch of depressed bankers, consultants, lawyers, and other related professionals who aren’t suited to their work environments but find themselves stuck in their chosen paths.
A couple of years ago, I met a student who told me she started an organization that was mapping out homeless shelters to make it easier for people to donate food and other items. She was bright, diligent, and ambitious. Later, I found out she was going to work for Accenture. Based on Accenture’s client base, I imagine she ended up helping corporations — not the homeless.
High-achieving students are capable of extraordinary feats. They enter college wide-eyed, with a belief that they can achieve anything. Eventually, many of them succumb to the prestige machine and are funneled into a handful of narrow, transaction-based careers.
If we continue along this path, one day our society will wake up to more people analyzing our future than building it.
This article, while initially inspired by my own observations while in college, was heavily informed by Andrew Yang’s fantastic book, Smart People Should Build Things.
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