Kunal Agarwal, 28, started the MBA program at UCLA's Anderson School for Management back in 2007 thinking he would end up working at a financial giant. But after watching the financial crisis claim major banks and investment houses while putting a damper on head counts and compensation, Agarwal held off on accepting a position at an investment bank as long as he could.
"Big established brands don’t really mean as much as they used to," he said.
The crisis that wiped out both Lehman Brothers and Bear Stearns and perhaps forever changed the world of high finance in America, is now forcing the next batch of MBA graduates to change their idea of where they’ll end up working. While some lucky students are still picking up traditional jobs, others have had to rethink their Wall Street dreams and look elsewhere.
Agarwal said he explored entrepreneurial opportunities at new technology companies but ultimately took the job at the investment bank.
Of course, some newly minted MBAs are jumping to take advantage of the dwindling opportunities at prestigious firms. Javier Escobar, a 28-year-old student at Columbia Business School, was offered a corporate banking position at Citi after interning there last summer.
Adair Newhall, who's graduating from University of Virginia's Darden School of Business this month, is going on to work at venture capital firm Domain Associates. Newhall, 30, also interned at the company during the summer and was talking to several venture capital firms before he finally got an offer from Domain Associates a couple of weeks ago, securing his dream job.
"I'm probably the minority on this one," he admitted.
Though Newhall and Escobar didn't have to settle, some of his class mates are having to.
"They’re being more flexible in the types of jobs they take, and taking jobs in other cities and not necessarily staying in New York," says Escobar.
- Slideshow: Degrees in Most Demand
Overall, recruiters expect to hire an average of six new MBAs this year, half that of 2008, according to a survey conducted by the Graduate Management Admission Council, a global association of graduate business schools.
"Students need to be resilient and look way beyond their dream job," said Jody Queen-Hubert executive director of career services at Pace University's Lubin School of Business.
That means considering job offers from government agencies as well as health care and energy companies. Alternative energy, in particular, has assumed a higher profile, thanks to President Barack Obama's agenda.
"I think some students might find it’s a scary time to graduate, but they might be at the front end of careers of the future," says Rebecca Joffrey, co-director of the career development office at the Tuck School of Business at Dartmouth, adding they represent the “big problems that we're addressing as a society."
President Obama's suggestion that it may be a good time for the the best and the brightest to work for the government has probably inspired more than a few students, but a government job has other virtues in a world of layoffs and high unemployment.
"It seems more secure from the student perspective and the benefits are good," says Zelon Crawford, director of graduate career management and corporate relations at Temple University's Fox School of Business. Crawford notes the IRS recruited at the school this year for the first time.
Agarwal, the UCLA Anderson student, noticed that the government representatives were "more aggressive in their recruiting this year," based on their presence on campus and the number of jobs posted on the school’s job site.
Students who fail to find a job by graduation will still look to their schools for help.
"All schools will graduate students with fewer offers than we did last year," said Jack Oakes, director of the Career Development Center at the Darden School of Business. "We'll continue to work with these graduates throughout the summer even as we ready for the new crop of students coming in."
(Editor's note: This story was updated since it was originally published May 22.)