The stunning collapse and fire sale of investment house Bear Stearns (BSC)--a major employer of business graduates--has added another worry to an already shaky hiring outlook for business grads, college officials say. While major career services organizations haven't entirely reversed earlier predictions that the hiring market for 2008 grads is going to be strong, reports of recruiters cutting back on the number of job offers and, in some cases, lower starting salaries are beginning to surface.
Reductions are not just happening in the financial-services sector but across the board, from consulting companies to those in various manufacturing sectors, said Tom Kozicki, board president of the MBA Career Services Council, the umbrella group of school career placement officers. The officers are pointing out that most grads are still receiving one or more offers, but these latest cutbacks will mean they will have fewer options to choose from--and less bargaining leverage for salary. "What I'm hearing from people within the major companies who bring on intern classes each year is that they are still doing recruiting, but they are bringing on many fewer interns as compared to last year," Kozicki said. "It is hypercompetitive anyway, and this just makes it that much more competitive."
The news of the Bear Stearns takeover by JPMorgan Chase (JPM) was followed by a Mar. 19 report by the National Association of Colleges & Employers that said the economic climate is having a cooling effect on the hiring prospects of undergraduates looking for jobs. Although employers expect to hire 8% more new college graduates from the class of 2008, that figure is still down from the fall of 2007, when employers projected a 16% increase in college hiring. The drop-off is being acutely felt in the finance industry, according to the report.
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